The path of max confusion
Posted by Danny on December 21, 2015
After a volatile week the S&P 500 is once again testing the 2000 level, a major breaking point. Is the market just bending, or is it about to break down? This is always a difficult question. Markets tends to follow the path of max confusion, shaking out as many passengers as possible before making a significant move. Volatility tends to shake out market passengers and when the bus is nearly empty it is ready to go again…
Let’s have a look at the S&P chart (click image to enlarge it):
The pullback that started in early November keeps grinding. The good news is that the overbought conditions have gradually subsided and the technical situation is improving. The slower Earl2 (orange line) is now firmly in bottom territory, which sets the stage for a nice santa rally as long as the support near 2000 is not decisively broken to the downside.
A drop below 1990 would probably send the S&P 500 back to the Aug-Sep lows and then we would have to wait a bit longer for the next tradeable bottom.
Good luck.
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This entry was posted on December 21, 2015 at 1:57 pm and is filed under Financial Astrology, Market Commentary.
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LunaticTrader
The path of max confusion
Posted by Danny on December 21, 2015
After a volatile week the S&P 500 is once again testing the 2000 level, a major breaking point. Is the market just bending, or is it about to break down? This is always a difficult question. Markets tends to follow the path of max confusion, shaking out as many passengers as possible before making a significant move. Volatility tends to shake out market passengers and when the bus is nearly empty it is ready to go again…
Let’s have a look at the S&P chart (click image to enlarge it):
The pullback that started in early November keeps grinding. The good news is that the overbought conditions have gradually subsided and the technical situation is improving. The slower Earl2 (orange line) is now firmly in bottom territory, which sets the stage for a nice santa rally as long as the support near 2000 is not decisively broken to the downside.
A drop below 1990 would probably send the S&P 500 back to the Aug-Sep lows and then we would have to wait a bit longer for the next tradeable bottom.
Good luck.
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Like this:
This entry was posted on December 21, 2015 at 1:57 pm and is filed under Financial Astrology, Market Commentary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.