S&P 500 - Could An Ascending Wedge Pattern Playing Out?
The S&P 500 chart seems to be plotting out a multi year (2018-2019) ascending wedge pattern.
At the moment the technical pattern cannot be viewed as either bearish or bullish whilst it grinds out the formation.
A sustained break-out above the 3050 level could see NEW HIGHS to 3450 (1.618 Fibonacci Extension) which would
imply +13% upside. Conversely a sustained break below 2881, could imply downside to 2450 level.
An interesting observation to note, when looking at a momentum indicator, in this case, the 21 week Relative Strength Index (RSI).
The RSI has plotted 3 lower highs whilst the S&P 500 achieved 3 higher highs over the 2018-2019 period, which implies sustained or
increasing buying momentum is not matching the new weekly highs on the price chart over the same time period.
Be Careful Out There!
At the moment the technical pattern cannot be viewed as either bearish or bullish whilst it grinds out the formation.
A sustained break-out above the 3050 level could see NEW HIGHS to 3450 (1.618 Fibonacci Extension) which would
imply +13% upside. Conversely a sustained break below 2881, could imply downside to 2450 level.
An interesting observation to note, when looking at a momentum indicator, in this case, the 21 week Relative Strength Index (RSI).
The RSI has plotted 3 lower highs whilst the S&P 500 achieved 3 higher highs over the 2018-2019 period, which implies sustained or
increasing buying momentum is not matching the new weekly highs on the price chart over the same time period.
Be Careful Out There!