Boy, the market is just not ready to sell off yet. The rising wedge that I have been tracking is just no longer a good classical chart pattern to use because the market just has no follow through selling at any time.
As an alternative, given today's bear stomp into the close on such high volume, I just have to assume that the market wants to challenge the February gap, if not even the all-time highs. We may have a channel that has developed, and I will not be surprised if we now endeavor to reach the top of the channel in a great hurry.
The two blue lines represent the perimeter of the February gap, and there is just no volume in there to support much selling, I would suppose. When we entered it before, there was some initial resistance, but now that we have entered it a second time, I will not be surprised to see us gravitate right through it, and in fact I think it's probable.
Given the many risks facing the economy and the extremely overvalued nature of equities, I do not believe we can stay at these lofty heights for very long. But, bears may now need to wait another week or even two before looking forward to a top, I now believe.
As an alternative, given today's bear stomp into the close on such high volume, I just have to assume that the market wants to challenge the February gap, if not even the all-time highs. We may have a channel that has developed, and I will not be surprised if we now endeavor to reach the top of the channel in a great hurry.
The two blue lines represent the perimeter of the February gap, and there is just no volume in there to support much selling, I would suppose. When we entered it before, there was some initial resistance, but now that we have entered it a second time, I will not be surprised to see us gravitate right through it, and in fact I think it's probable.
Given the many risks facing the economy and the extremely overvalued nature of equities, I do not believe we can stay at these lofty heights for very long. But, bears may now need to wait another week or even two before looking forward to a top, I now believe.