SPX expectation for Tuesday

What will SPX do tomorrow? I don't have a clear answer here. It comes down to support and resistance, as always. If resistance holds, then prices will move lower. If the bulls can break over resistance, then aggressive increases can occur as noted in the post below.  The ES futures and European markets could change all of this, and help provide more insight in the coming 8 hours.

Right now, I'm inclined to think that prices will move lower tomorrow.

I'm using SPY for the attached chart because SPX had data errors today. SPY will show the chart patterns as SPX.

The chart below shows a bearish triple divergence in MACD, which suggests that a pullback should occur, and possibly even a double top.  However, the RSI shows no such divergence but rather supports the upward price movement. Further, the RSI and Stoch have started to turn up. So there are both bearish and bullish interpretations.  (One can argue that the Stochastics also show a triple bearish divergence, since the stoch looks to have made a triple top while the prices moved higher. However, personally I'm rejecting this notion because the stochastics don't really have that much room "up there", yet plenty of room lower. Thus, for me, the stochastics is not useful for divergence readings this time).

Why is this? Well, also notice that the prices right now are caught right between the 2 moving averages (5MA and 15MA) on the 60 min chart. Also notice how the 5MA bounce UP off the 15MA twice alreaad, propelling prices higher.  So, Monday ended with prices in between these levels, and time will tell if the SPX (1) simply made a test of the 15MA and will bounce to continue higher, or (2) that the break of support today (when ES broke 1073) was the start of a larger pullback that will move below the 15MA.

In the chart below, I have removed a lot of my trendlines and other drawings, to make it easier to read. Will possibly post the other chart with more details later.

* ChristopherStockGuy is not an investment advisory service, nor a registered investment advisor or broker-dealer and does not purport to tell or suggest which securities or currencies customers should buy or sell for themselves. For details, see the post from SATURDAY, AUGUST 15, 2009 titled "Disclaimer".