Vladimir Ribakov maps two bearish scenarios for the S&P 500, both triggered by breaks below recent lows and MACD divergences, with targets around 63.50 and 62.00. A long bearish divergence on the MACD is the primary warning sign. He warns traders to wait for clear confirmation before acting, not to guess timing.
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So, two scenarios which I plan to follow for the bearish breakout, or if the buyers restructure its cycle by making three higher highs, higher lows, buy the dips will then become the trading plan for me. S&P 500 climbing endlessly like majority of the indices, especially the U.S. ones. However, I believe the current slowdown and the rounding condition we started to see hint that a correction is possible, especially with the pressure of the government shutdown we have in the US. There is a long bearish divergence developing on the moving average of the MACD, which means a correction is very possible. What I want to see to trigger the correction. 2 scenarios for that. Scenario 1, the ideal one, would be if we start to see some false breakout here and then we have the daily divergence and the 4-hour chart divergence. For that, connect the recent trend line and break below the recent low should open the doors for a sell going back to the next key lows we have on the index. Alternatively, if the peak already is formed, break below the daily current low and making lower lows on the histogram and lower lows on the chart alongside a break below the rising trend line should open the door again for the further move down And the retest of the next key lows. The next key levels on the way should be about 63.50, then about 62.00, and potentially to retest the weekly broken support— resistance that now acts as support around the 61.00. But again, very important to mention here, don't try to guess when it's going to happen. Wait for the official sign. When indicators indicate, the price dictates, and when the price manages to give the reversal signs, that's the moment to act. Remember, our job as traders is not to guess, is act to the way the price acts.
