Now price has broken ABOVE the resistance line, and I'm forced into a neutral position. This means I have no conviction either way, and any trades I take will be 1/3 of my full size.
I do not want to be one of these traders who perpetually tries to short US equities - which is exactly what has fueled the most hated rally in history. Yet, I maintain that this could be a FALSE BREAKOUT, and that significant downside remains a possibility. For that to happen, price would need to quickly reverse, fall back under the top side of the multi-month triangle, and stay below there.
Another possibility is that we see a choppy consolidation at these levels over the next few months, before simply rocketing higher. For the case to be confirmed, I would still need to see a closing above the 25800 level to indicate strength.
For now I'm neutral, with a slight leaning. My bearishness is colored by the action in S&P and the Nasdaq - updates coming soon.
I will take a small short position on a Monday rally, with a stop above last week's high. If price moves higher next week, I will wait for a clear pattern to emerge before acting.
Trade tariffs with china , EU not sorted yet, 21 trillion debt , 10 year rate rising, shut down coming, iran issue, N.K not much going on .......... list goes on so yes bearish
The 2017 chart had a strong August and led up to an Xmas rally with the record high of Jan 2018. Will it be a repeat or a reversal of that pattern??