Domistock Tools Used:
Assets charted: S&P 500 index (.SPX)
S&P 500 has been falling like a rock but DomiStock has now plenty of signs that fall is overextended and about to reverse. To start with, the 5-Day, 65% Resultant Direction of the Max Profit Loss Calculator has turned positive, forecasting a diminishing of the supply forces and an enforcement of the demand ones. Additionally, the profits of the current 11-day “go short” DomiStock signal are the highest of any equivalent in duration signal in the last 200 periods and apart from that the duration of the signal itself is the longest since last July.
That marks what is called in DomiStock theory a “time resistance”, which S&P is testing right now. Indeed, since April 2014 there have been only two “go short” DomiStock signals that stayed intact for longer than the current one and that was for just one extra day. Hence the 100% of the time resistance for the current downward rally is just one session away.
Moving on to the hourly bar chart of S&P, where we see that the dominant signal is already bullish, while the 2-hour Resultant Direction of the Max Profit Loss Calculator has turned positive and there is an important support in test.