Market is at a critical level. Today, it closed under 12 MA sitting right on the trendline which previously has held strongly multiple times.
The difference is, this time market has a solid reason to be skeptical of further growth. That's our first red flag!
Our trendline is now being tested while the rising wedge is getting very close to its decision time, which could be tomorrow. We all have been anticipating some sort of a post-pandemic correction, but is this is?
The second red flag is the volume. Bears tried to push the market down yesterday and they failed. But, today was their glorious day. And the third reflag is the MACD which looks pretty ugly and has a good chance of continuing its red trend. If that happens, our major trendline will be broken and who knows where SPY is going to land this time.
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Expanding on why market could be skeptical of the future growth. There are numerous reasons including inflation, underwhelming consumer reports, Delta variant, possibility of earlier than expected trapering, and seasonality of the market.