It was the QQQs that heeded the early warning signs to get out of dodge back in October. Those signs are arising again. There is literally like 8 different wedge patterns you can draw up on the SPY, but none are quite as clear as the Q's have been. Last time we broke the wedge (2018), we ran back up trying to retest the bottom side of it before ultimately crashing a few weeks later.
We just broke the bottom side of the wedge on high volume today. New highs were NOT made, we do have a descending triple top though. I'm not crazy enough to say this is the top, but pending some crazy high gap up tomorrow, this could be our last warning before it gets ugly.
Tomorrow will be huge, we could pop back inside the wedge and truck higher a little longer. I do think its more likely we gap down to the 2018 highs, and we get the last final "buy the dip" crowd that pushes this sucker up one more time. But much like we seen in 2018, we can ride the bottom side of this wedge for a bit before crashing.
The China deal would fit the bill quite well for this if it were to actually happen next Friday, but then again, we've been a week away from a deal for 5 months now.
Key levels:
194.00- Looks like a good potential top area based on how it'd line up with fib retrace
190.90 - would need to see this broken to be bullish for the coming days
187.63
182.82
175 - When the drop happens, this is where I see the first "major" bounce coming from.
We just broke the bottom side of the wedge on high volume today. New highs were NOT made, we do have a descending triple top though. I'm not crazy enough to say this is the top, but pending some crazy high gap up tomorrow, this could be our last warning before it gets ugly.
Tomorrow will be huge, we could pop back inside the wedge and truck higher a little longer. I do think its more likely we gap down to the 2018 highs, and we get the last final "buy the dip" crowd that pushes this sucker up one more time. But much like we seen in 2018, we can ride the bottom side of this wedge for a bit before crashing.
The China deal would fit the bill quite well for this if it were to actually happen next Friday, but then again, we've been a week away from a deal for 5 months now.
Key levels:
194.00- Looks like a good potential top area based on how it'd line up with fib retrace
190.90 - would need to see this broken to be bullish for the coming days
187.63
182.82
175 - When the drop happens, this is where I see the first "major" bounce coming from.
Comment:
Comment:
Just tried breaking the lower trendline and rejected on very high volume. Should be getting interesting. Got to break the bottom trendline and hold it for a couple days to remain bullish.
If we are still here next Friday, and we somehow miraculously get a trade deal, that'll be the catalyst no doubt.
If we are still here next Friday, and we somehow miraculously get a trade deal, that'll be the catalyst no doubt.
Comment:
You mean the past 4 months of, "We're close to getting a deal done" was a lie? Who knew....
-I don't know how the markets dig themselves out of what Trump said yesterday, but none the less, we're at the lows from last Thursday again. A bounce here "should" happen from a psychological standpoint as every dip and buying opportunity that has been presented over the past 4 months has happened. If it does not, a change of trend is happening. A change of trend featuring a sharp sell off in our near future in my opinion.
Yet, we are always just one "we're still in great negotiations with China" tweet away from the bulls trying once again to pop the markets higher.
Bear case - Break these pre-market lows, retest and down to 183.00 we go.
Bull case- We need to break the 191.50 area on good volume and hold it for a couple days.
-I don't know how the markets dig themselves out of what Trump said yesterday, but none the less, we're at the lows from last Thursday again. A bounce here "should" happen from a psychological standpoint as every dip and buying opportunity that has been presented over the past 4 months has happened. If it does not, a change of trend is happening. A change of trend featuring a sharp sell off in our near future in my opinion.
Yet, we are always just one "we're still in great negotiations with China" tweet away from the bulls trying once again to pop the markets higher.
Bear case - Break these pre-market lows, retest and down to 183.00 we go.
Bull case- We need to break the 191.50 area on good volume and hold it for a couple days.