Although the action in the stock market has been bearish and we could be in the beginning stages of a longer-term bear market, there is now a bullish divergence on the SPY daily chart. This occurs when the RSI inclines upward while the price declined further downward. The price action typically increases from a near oversold level to higher levels when this happens. I'm not saying that we'll go to all time highs, but we could see a bear market rally at the very least. The RSI could reach a near overbought level from here.
We saw a rally in the 2nd half of March before going lower. So, this set-up could lead to a similar price move upwards in the next week or two. The Dow and QQQ are also showing bullish divergences on daily charts.
David Zanoni
We saw a rally in the 2nd half of March before going lower. So, this set-up could lead to a similar price move upwards in the next week or two. The Dow and QQQ are also showing bullish divergences on daily charts.
David Zanoni
