Three Push and Wedge on SP 500

Apr 17, 2009: 1:12 PM CST

A new structure has developed, which is known as the “Three Push Pattern” as price continues to ‘wedge’ itself into a rising consolidation.  Let’s see the current S&P 500 structure mid-day on the 60min chart.

Price has now rallied to the peak of the converging trendlines that are forming a possible bearish rising wedge, which places it at a “make or break” price point we all need to watch very closely.

I wanted to get this post out quickly to show the developing structure, which has now formed a “Three Push” Reversal Pattern.  Notice the three new price highs that formed on a triple-swing negative momentum divergence in the 3/10 Oscillator.

The expected play at a minimum is for a retest of the rising trendline around 850, but aggressive traders might want to hold on for a larger target should price weasel its way out of the wedge formation, which would be quite bearish.  Should price continue to rally and break outside the wedge, the stop-loss point would be clearly defined.

Do your own analysis and see what else you might be able to glean from the current price structure.

Corey Rosenbloom
Afraid to

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  • Anonymous

    Since we closed today below the 848 level we can consider that pattern complete and get bear minded again.
    Also, I think there's a bug in the URL handing of the blog
    When I try to post the stockcharts link the $GOLD it keeps showing up as GOLD.

  • Anon #32,

    Thanks for clarifying - sounds great!

  • DaveB

    I took some shorts Friday afternoon, I figure I can at least play for a test of the "cradle" around spx 820. Although a breakdown of the rising wedge would suggest a deeper retracement, back below 800.

  • Anonymous

    Of course there will be divergence on the macd. Each push in a wedge is smaller. That's why it is a wedge.

  • Schweizer

    Bollinger Bands on the weekly $VIX are squeezing, and price is already outside it, so something is gonna happen soon.

    Thanks for your work.

    By the way the Pi Cycle turn date, with a minor cycle 2.15 yrs long, is today.

    This model, developed in 1999 nailed model the following dates as major turning points: September 2000 (S&P and DOW market top), November 2002 (S&P and DOW market bottom) and, most recently, February 27th, 2007 (the credit bubble popped). We are now exactly 2.15 yrs later, and about to likely take another turn.

    Hmmm ....

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