FX.co ★ Technical analysis on SPX for August 3rd, 2023.

Blue lines- bullish channel (broken)

Red line -bearish RSI divergence

SPX is under pressure for a third day in a row. In previous posts we warned traders that a reversal was very possible. The bearish RSI divergence has warned us that the up trend was weakening. Yesterday we saw price break out of the bullish channel providing a bearish reversal signal. SPX is now in a corrective phase and with the RSI turning to new lower lows, we expect to see a pull back in the index towards at least the 4,480 area. There is an open gap at 4,580. I do not expect to see the gap filled if price is in the process of a corrective phase now. Second downside target is at 4,400.