Sell in May and Go Away?
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, 05-01-2013 at 12:52 AM (5599 Views)
Today SPX put in a twin top at 1597. However, the short term RSI and MACD are showing negative divergences, as seen on the hourly chart, and the stochastic is overbought as well. The second chart shows the summation indexes in the daily timeframe; NY Summation Index as dotted line in the main panel and the NA Summation Index as a solid line in the same view. While the MACD has flashed a buy signal several days ago (vertical green line to the far right), there is overhead resistance as seen by the purple (NY) and yellow (NA) horizontal lines, going back to September-October of 2012. You can also see that recently this spring that the market has traded above these lines, so they are now resistance. And for the past two years, a sell-off has been sparked after May 1. Is a repeat in the works? We should know soon.