Selling SPX from ascending channel's upper limit

Analyzing the S&P 500 index (SPX) on a four-hour (H4) chart reveals an ascending equidistant channel that has been in place since early August. This structure defines a central axis around which prices cyclically fluctuate. A new bullish phase started in early October. The prevailing sentiment now is that quotes will reach the channel's ceiling within the next two or three trading sessions, potentially triggering a corrective move back towards the axis. Since the onset of September, the index has been confined to the upper half of the channel, hovering exclusively between the axis and the top limit. Such positioning suggests the S&P 500 is in a technically overbought state. Whereas this hints at a possible drop, it conversely reflects the power of the rising trajectory. Historically, September has been a corrective month for SPX, while October and November tend to see growth. However, this dynamic did not materialize this year. Therefore, the market is now pricing in this deferred and unrealized correction to take place. This creates a context in which even a minor catalyst could trigger a downward move. Given this setup, consider a sell entry when the price hits the channel's upper limit near $6,760.

The overall recommendation is to sell the S&P 500 index from $6,760. Profits are taken at $6,670. Stop loss is placed at $6,810. This trade goes against the current uptrend and implies high risk.

Calculate your open position so that a potential loss (protected by a Stop Loss order) is limited to 1% of your deposit. If your account balance does not allow entering a position of this size, it is better to skip the trade and wait for other market signals that meet low-risk criteria.