Stocks had a little flash crash that was immediately bought back up. Currently, the S&P is sitting at highs. After a crash like that it was lucky to get bought back to highs let alone break out again. The Kovach OBV has run out of steam and is flat at current levels. This is not a divergence quite yet, but it does suggest stocks should at least range a bit before another breakout. It could go either way at this point. Watch if the S&P tests and rejects highs at 3867. If it keeps rejecting highs, it will constitute a bearish signal. If we are able to breakout, 3887 will provide resistance and is our next target. Yesterday, 3792 provided beautiful support and it is no accident that this is one of our significant levels. It is a Fibonacci level and a technical level. Watch for it to provide support again if we have another dump
If it breaks upward throesistance, 3887 as next fib 1.618 target level based on ~3835 fib zero level?
3835.83 + ((3867.55 - 3835.83) * (0 0.236 0.38 0.5 0.618 0.786 1 1.618))
3835.83 3843.32 3847.88 3851.69 3855.43 3860.76 3867.55 3887.15
Actually, that step takes far more judgement and experience than I have. Maybe strongly related to recent market behaviour or something, and a bit of an art.
quantguy
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@Bill_Howell, Hey sorry for the delay. Yes, Fibonacci levels are a bit of an art and a science combined. The 3887 level was from a 1.618 Fibonacci level that is not visible on the time frame and interval shown on the chart. I call these 'nested Fibonacci levels': when the Fib levels on different time frames or time intervals agree. Hope this helps.
3835.83 + ((3867.55 - 3835.83) * (0 0.236 0.38 0.5 0.618 0.786 1 1.618))
3835.83 3843.32 3847.88 3851.69 3855.43 3860.76 3867.55 3887.15
Actually, that step takes far more judgement and experience than I have. Maybe strongly related to recent market behaviour or something, and a bit of an art.