Firstly, based on the charts we can see that the S&P500 is likely due for a correction based on the 77 to 80 day time period.
Secondly, the indicators Stochastics (14, 3, 3) and RSI (14 Close) indicate that we are reaching an overbought position based on the daily time frame as well as on the monthly chart.
Thirdly, following the upward trend pattern of support and resistance, we are about to hit the 0.5 (3909.8) level of the Fibonacci Extension starting from the bottom of the Covid-19 market crash last year with the high on 2nd September 2020 and the low on the 24th of September 2020.
These are my reasons as to why there might be a potential correction due soon.
My opinion is that we might see a 8% to 12% correction to the downside towards the 100EMA line (Green Line) and be held by support level at 3532.4 (Orange Line) on the daily time frame in the weeks to come as we close upon the months of February and March 2021.
Stay cautious investors and traders.
Just my 2 cents.
Secondly, the indicators Stochastics (14, 3, 3) and RSI (14 Close) indicate that we are reaching an overbought position based on the daily time frame as well as on the monthly chart.
Thirdly, following the upward trend pattern of support and resistance, we are about to hit the 0.5 (3909.8) level of the Fibonacci Extension starting from the bottom of the Covid-19 market crash last year with the high on 2nd September 2020 and the low on the 24th of September 2020.
These are my reasons as to why there might be a potential correction due soon.
My opinion is that we might see a 8% to 12% correction to the downside towards the 100EMA line (Green Line) and be held by support level at 3532.4 (Orange Line) on the daily time frame in the weeks to come as we close upon the months of February and March 2021.
Stay cautious investors and traders.
Just my 2 cents.
Comment:
We have broken the 20-day EMA support on the daily time frame. Something which has not been done since 26 October 2020.
Comment:
The index is currently sitting above the 50-day EMA on the daily timeframe. Futures for the major 3 indexes are looking red. Will look to see if it can hold this support for a few days if it breaks, we will see a bigger move to the downside as I predicted.