Bulls remained in charge so far with most consolidation periods ending up in continuation patterns and further upside.
What may be different this time? and what would be needed before we can project a more meaningful reversal?
• SP500 reached notable resistance of 2815, where it failed three times between October and December
• Daily oscillators show overbought signs:
o Daily RSI is near 70 for the 1st time since august 2018
o MACD is about to cross below its moving average
o Stochastics in overbought zone and diverging
• A breach below 2760 followed by a lower high would be the next step needed for a more meaningful consolidation. Potential target at the 2600-2630 area.
• A move back above 2800 -2815, would mean bulls are still in control, and paves the way for 2865, potentially 2940.
Keep in mind that so far, all consolations have failed to trigger a reversal and ending up in bullish continuation patterns. Always keep a process in place, in case things don't go as expected.
What may be different this time? and what would be needed before we can project a more meaningful reversal?
• SP500 reached notable resistance of 2815, where it failed three times between October and December
• Daily oscillators show overbought signs:
o Daily RSI is near 70 for the 1st time since august 2018
o MACD is about to cross below its moving average
o Stochastics in overbought zone and diverging
• A breach below 2760 followed by a lower high would be the next step needed for a more meaningful consolidation. Potential target at the 2600-2630 area.
• A move back above 2800 -2815, would mean bulls are still in control, and paves the way for 2865, potentially 2940.
Keep in mind that so far, all consolations have failed to trigger a reversal and ending up in bullish continuation patterns. Always keep a process in place, in case things don't go as expected.