index is moving in a descending wedge
, which is a bearish
formation. We can see that the market respects the formation, in which an overshoot of the upper trendline
resulteted in an overshoot in the ABCD
move (Which then hit the support line). We have a major ABCD
move going in bearish
direction down to 8350 and combined with the formation, it would be fair to guess we should be going down.
We therefore have 3. scenarios.
1) We rally up to the 10400 area, before sellers slams the price down through 9300 and all the way to 8350.
2) Buyers rally the market up over the upper trendline
, where a likely pullback will occur shortly afterwards, which will, it held, result in a bullish
3) We bounce some more inside the formation before 1 or 2 happens.