Chart of the Day – Thursday, August 22, 2024
1 month ago
2 MIN READ
5 day SMA$SPY $QQQ $SMH $XBI
30 Minute timeframe from August 1Caution
This is the script I created and gave out last month pic.twitter.com/OAvS8xoFfd
— Brian Shannon, CMT (@alphatrends) August 22, 2024
Today’s Chart of the Day was shared by Brian Shannon (@alphatrends).
- The rally slammed on the brakes today as the S&P 500 was rejected at all-time highs. There were many Bearish Engulfing candles created today. These ominous candlestick patterns often signal short-term weakness.
- Brian points out that several key ETFs (The S&P 500, Nasdaq 100, Semiconductors, and Biotech) violated their 5-day moving averages today. This indicates that the short-term trend has turned lower. Semis are the most vulnerable, with a declining 5-DMA.
- Longer-term trends remain higher, but caution is warranted in the coming days if these ETFs (primarily $SPY and $QQQ) are below a 5-DMA. As Brian often says, “The trend is guilty until proven innocent.”
Takeaway: The market reversed lower today as the S&P 500 was rejected at its former highs. The index is less than 2% from record highs, and the long-term trend remains higher. However, caution is warranted in the coming days as the short-term trend has turned lower.
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