It looks like the dow is now consolidating in a potential falling wedge pattern after it's big bounce over the last couple months. We got rejected at resistance, but so far we're still in good shape. It did put in a lower high but the structure of the move does look like it is respecting fib lines, which would line up with strong resistance. We will be in for a bumpy ride but looks like we may see some fireworks just in time around the 4th of july.
Is see no chance that the Dow is suddenly going to make a higher high than its 9th June high any time soon or in a year. We are turning down for the worst to come. There are series of macroeconomic news that have not yet hit the market hard enough. What we saw on the nasdaq was nothing more than the mother of all retests before a deep dive. Brace for impact in 2 to 3 years where I consider going bullish. Of course, 2 to 3 years is a long time, at midpoint we are having corrections, but no new highs.
The worst that can happen is an interest rate inflation between weak and strong banks that still have reserves, due to low bank solvencies. Even the US state loans are going to feel the impact of a high interest rate. - The worst thing that ever happened to a fragile economy like the one we were living in the last few years, was to elect Trump as president. He opened the gates of hell, with his grandiose talk and pushed the me economy over the edge just so that he could get reelected and shut everybodies mouths. Well, now he better get reelected, course the other candidates won't bail everybody out. However, I don't think that this could be avoided either by electing someone else, it just happened much sooner.
My opinion. Good luck.
mwinmill
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@smg200682, thanks for the perspective on the market fundamentals but all I'm doing is looking at patterns and applying technical analysis. Falling wedges break up most of the time, and typically when they do, they break up to the ledge of the flagpole. Absolutely there is tons of bad news to come and it will surely create a bearish picture. I'm not ignorant to the potential of a major drop from here. I have an idea posted about avoiding a second great depression...regardless, I see a pattern and all a pattern is - is a potential for follow through. Nothing has been logical about this rebound and we've been making a similar pattern to what happened just before the great depression. I'm inclined to side with your perspective but I'm waiting to see what plays out.
The worst that can happen is an interest rate inflation between weak and strong banks that still have reserves, due to low bank solvencies. Even the US state loans are going to feel the impact of a high interest rate. - The worst thing that ever happened to a fragile economy like the one we were living in the last few years, was to elect Trump as president. He opened the gates of hell, with his grandiose talk and pushed the me economy over the edge just so that he could get reelected and shut everybodies mouths. Well, now he better get reelected, course the other candidates won't bail everybody out. However, I don't think that this could be avoided either by electing someone else, it just happened much sooner.
My opinion. Good luck.