Its been a fantastic ride for those in the share market but is the end in sight?
Here is a view of S&P Index on log price scale stretching back 30 years or so. Each candle is one month. We can make a large bullish channel from the 2 main lows. How much of this bullishness is really just the purchasing power of the dollar falling? But regardless, price is finding resistance and unable to get back into the top half of the channel.
Looking at RSI prices are too high. On MACD a bearish cross looks to be in progress. I've missed out on the stock market unfortunately but there is no chance of me entering now. The bottom of that channel is around 1000 which is a 50% price drop. That is not unreasonable to forsee.
Comments
Will_Wong
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Between 1991 to 1994, it hovered below the channel. So there is really not a given that just because it failed to go above the channel that it has to drop. The 1500 top from 2007 is also a major support.
afbitcoins
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Yes then it broke UP not down in '95 !!!! I'd be amazed if that happens again though. Virtually impossible to predict when tide will turn especially on such long timescale chart. On shorter timescales there are very well defined trendlines you can watch so I guess if you brave enough you could go in now and hope to get out before ending up a bag holder.
Will_Wong
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If you look back at all the major crashes, you will see that those are not vertical drops. The shorter term moving averages typically crosses below the longer term averages way before the stock market actually crashed. I doubt guys who visit this site will be left holding the bags when the big one happen. I could be wrong.
afbitcoins
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Yes thats true, not many bagholders will be from here, unless caught up in a bit too much greed perhaps