As a trader I am always trying to stay in sync with the 60-minute charts. They help me keep on the right side of the trade. Friday I closed half my position on the ultra proshares (SSO) based on my analysis posted below. From my entry point on March 6, I managed to lock in a 50 % gain. I’ll let the market take me out on the balance of the position, with a stop loss just below the rising trendline on the hourly SSO chart. How was able I to make such excellent gains in such a short time, by using technical analysis of course.

This week the QQQQ made a bee line right for resistance near the 31.60 level. But after reality set that there would be no break out this week, prices took the path of least resistance and a reaction has ensued. With a rising wedge in place on it’s hourly chart, negative divergence on the RSI, and quadruple negative divergence on its MACD, this chart looks ripe for reversal. The S&P 500 hourly chart continues to break down from triple negative divergence. The quadruple and triple divergences are more powerful that a normal divergence.

15-Minute Broadening Formations

The S&P 500 and QQQQ 15-minute charts appear to have put in a broadening top 5 point reversal. Many reversals come groups of fives. A head and shoulders pattern, a triple top, often times a descending triangle will have five points. Elliott taught us, that there a 5 waves in a trend before an ABC reversal comes. So we could see those bearish patterns spill over into the hourly charts ushering in the corrective phase.

Inside Days On The Daily Index Charts

Both the S&P 500 and the QQQQ put in an inside day on their daily charts. That means we once again have bearish Harami patterns. Confirmation of the pattern would be a close below the lowest point of the first day of the two-day pattern. The 5-day stochastic will likely now roll over having negative divergence and being overextended. That ought to do significant damage to its hourly chart.

Descending Triangles On The Financials

The 5- and 15-minute financial ETFs XLF, UYG, and FAS all have bearish descending triangles, which will add weakness to this bank and tech rally.

Other Clues

The put/call ratio suggests we complacency among investors, and that they are unaware of the impending dangers here, as we hover at these overbought levels. The bulls are overdosing on calls. The stocks above their 50 day moving average is peaking near 75, hinting also that a short term top has been reached. Now I believe that we are in a new upward trend, so I’m looking for a higher low near a Fib retracement, that will give birth to a new rising trend in the daily timeframe.

http://stockcharts.com/h-sc/ui?s=$SPX&p=60&b=5&g=0&id=p95561935010&a=164070373