Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Mean Reversion Looks Close

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The last high on SPX reached a few days ago was an impressive 5.54% above the 45dma, one of the highest readings in the last decade excluding the initial spike up from the March 2020 low, and slightly above the 5.4% reached at the early 2018 high. Coupled with the strong punch over the NDX weekly upper band then, that is a strong indicator that at least a short term high is being made, and I’m looking for a reversion to the mean move back to the 45dma, currently in the 4491 area.

SPX Daily vs 45dma chart:

SPX Daily vs dma
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Nasdaq Setting Direction Here

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I haven’t written a post since 1st September as I’ve been immersed in divorce paperwork again. (Note from Tim: again, this post is from Jack, not me; I’m not going through a divorce. As you might suspect, any woman who gets involved with me is greeted with 24 hours of delight and sunshine every day. I ask that you not confirm this, as it is surely self-evident. Thank you. I now return you to Mr. Springheel) That should all be finished within a few days, and that should be the last serious work that needs to be done in my quest to be single again, which will be a relief. This should therefore be the last long gap in my posts.

In my last post I was talking about the likely retracement to the mean move that I was expecting to see soon, and we have seen that move. The level I am using for that, the 45dma, is currently at 4462 and SPX is backtesting that from below at the moment, having delivered one of the only four retracements in the last eighteen months to deliver a retracement significantly below that.

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Rising Wedges And Mean Reversions

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I was looking at the tests of the main resistance trendlines on SPX and ES on Monday, and at the possibility that SPX might turn down there. Instead it broke through, dragged upward by tech stocks, and the very nice daily RSI 5 divergence on both SPX and NDX was lost.

On both SPX and ES, price is now slightly above the main resistance trendlines in what may be a bearish overthrow.

SPX daily chart:

SPX Daily
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A Moment Of Truth

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I’ve been looking at the resistance trendlines on ES and SPX over my last few posts, and the scenario I was looking at in my post on Friday 6th August that we may be seeing the start of a retracement here that could deliver a 3800 area retest. I was saying that we might well see more highs before that main move started and we’ve seen that.

One resistance trendline that I wasn’t looking at was the rising wedge resistance trendline that has developed over recent weeks and ES is testing that too. Possible daily RSI 5 sell signals are now brewing on ES, SPX and NDX.

ES Sep daily chart:

ES Sep Daily
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