I wanted to republish the old chart, but i had to change the view to weekly to show this easier
On my previous charts on SP500, i had a blue support line - you can see on this chart where it came from. Today stocks opened at -2% (never happened in last 1.5 years i think), went down to hit almost -3% and then rushed up to close between -1%-0%(pity i did not swing trade, best place ever to score 5% in one go). From a higher perspective - it was around April low as well.
Surprisingly, that -3% April low spot is around exactly -10% from the recent top/all time high. Technically SPX500 had a 10% correction today and already gained back some off of it. Am i bullish? Not quite yet. But looking at other charts and aspects i see something that may add to the point
- Indices closed higher than the open.
- IBB ended in green and Russel ended in +1%. Nasdaq was higher than the rest
- Many tech stocks that lead the sell-off ended in green and made a run of 4-5% in distance
- Nasdaq has touched the support that was there from previous bottoms (see my chart on Nasdaq cloning itself), so one imaginary way from here would actually be the continuation of the clone.
- Weekly and of course daily RSI and CCI are already in oversold territory, though no bottom yet confirmed on the weekly. But it made a nice sharp run from above 70 (where we called the divergence)
THOUGH On the hourly/30min chart the SPX500 is still in the newly created sharp downtrend - but ended sitting close to the top of the trend. (Check this idea out and changing it to 30/60 mins you will see the current channel and how SP is still nicely in it)
Possible outcome?
- Breaking the smaller trend SP500 can change its direction for now, and go up from here (i'm not sure what was all the bullishness today about after touching a -3% bottom in a day, but it does show some more confidence - maybe it was the 10%:)? )
- Or we break away and go lower from here following Europe. Personally, i've witnessed many times how green European indices followed suit to US and ended the day in red in last 2 hours of trading. Many indices ended in red today all over the world, while US indices were so close to having some green in the end. Especially the tech savvy Nasdaq.
If this is it, and all this a-la 2011 (and we are quite close on many indicators), then blue chips will be targeting higher grounds in the year's end. For now i would not bet my bottoms for a short, but not call a long here either. If tomorrow tries to stay in green it would be a good day to buy some cheap shares if they are cheap (today already gained 1-2% from the bottom). Many stars lining up (though not in among the economical news) but time will tell.
PS - i added some clones of the previous times the price was at the low end of the trend (pint 2011-10, blue 2012-11). The pink one has a nice consolidation happening at the same place we would have a resistance from the previous top.
On my previous charts on SP500, i had a blue support line - you can see on this chart where it came from. Today stocks opened at -2% (never happened in last 1.5 years i think), went down to hit almost -3% and then rushed up to close between -1%-0%(pity i did not swing trade, best place ever to score 5% in one go). From a higher perspective - it was around April low as well.
Surprisingly, that -3% April low spot is around exactly -10% from the recent top/all time high. Technically SPX500 had a 10% correction today and already gained back some off of it. Am i bullish? Not quite yet. But looking at other charts and aspects i see something that may add to the point
- Indices closed higher than the open.
- IBB ended in green and Russel ended in +1%. Nasdaq was higher than the rest
- Many tech stocks that lead the sell-off ended in green and made a run of 4-5% in distance
- Nasdaq has touched the support that was there from previous bottoms (see my chart on Nasdaq cloning itself), so one imaginary way from here would actually be the continuation of the clone.
- Weekly and of course daily RSI and CCI are already in oversold territory, though no bottom yet confirmed on the weekly. But it made a nice sharp run from above 70 (where we called the divergence)
THOUGH On the hourly/30min chart the SPX500 is still in the newly created sharp downtrend - but ended sitting close to the top of the trend. (Check this idea out and changing it to 30/60 mins you will see the current channel and how SP is still nicely in it)
Possible outcome?
- Breaking the smaller trend SP500 can change its direction for now, and go up from here (i'm not sure what was all the bullishness today about after touching a -3% bottom in a day, but it does show some more confidence - maybe it was the 10%:)? )
- Or we break away and go lower from here following Europe. Personally, i've witnessed many times how green European indices followed suit to US and ended the day in red in last 2 hours of trading. Many indices ended in red today all over the world, while US indices were so close to having some green in the end. Especially the tech savvy Nasdaq.
If this is it, and all this a-la 2011 (and we are quite close on many indicators), then blue chips will be targeting higher grounds in the year's end. For now i would not bet my bottoms for a short, but not call a long here either. If tomorrow tries to stay in green it would be a good day to buy some cheap shares if they are cheap (today already gained 1-2% from the bottom). Many stars lining up (though not in among the economical news) but time will tell.
PS - i added some clones of the previous times the price was at the low end of the trend (pint 2011-10, blue 2012-11). The pink one has a nice consolidation happening at the same place we would have a resistance from the previous top.
