I was neutral on this repeat triangle formation. Rise, consolidation, drop to bottom long term trend line. If the three tops were in line, I was suspect it to break down past the bottom trend line on the third triangle, third descent. But SPY pattern are higher highs and high lows. Note the smaller time frame and lower volumes each triangle, which makes me suspect this pattern will discontinue soon. Ok so that was SPY - WYSIWYG. Then I overlayed a few , and found one my favorite theories at work again. BOJ, ECB, and FED are driving this market, PERIOD! Currency leads, markets follow. Now, if you compare that currency pair with this broader based view of SPY, it all makes sense. Bulkowski's Triangles, Ascending, down breakout in play here, but with a Central bank manipulated variation. Catalysts for the next drop, possible, ECB (June 5th) does nothing, and BOJ follow suite (this is a currency war isn't it) goes ahead without action, when the market is thinking they have to lower rates and stimulate, they don't, and real deflation worries with a slowing GDP world wide dose of reality kicks in.
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claydoctor
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Just a though, and update to this chart... what if... So the ECB lowered rates, and if that doesn't start borrowing, then they QE (Euro style), and if that really does not stem of deflation, then Europe is in a world of hurt, and that will hurt the world markets. The Status Quo assumption is, well, the FED's stimulus worked, the Abenomics worked, but what if, Draghunomics does NOT work. Remember, the FED and the BOJ were just trying to stimulate a boring economy, but the ECB is trying to not only stimulate a boring economy, but also one that has true deflation, not just stagnation, and with the main stream media being paid to issue all good news so people with keep buying stuff (XLY), if this ECB moves does NOTHING, what's to say anything else will. If the market senses this, looking forward, this could be the shock we've been waiting for to send market correcting (over 10%. I hope not. Let's see what report come out, expectation being met from this move, etc