The market is in a tightening range, and next week is likely to tell whether we see a sharp decline or growth into the end of the year. If bulls can punch through the long term trendline active since July and hold above, I see limited growth into the end of the year. However, the higher probability set up in my opinion is a short upon the test of the long term trendline resistance and break of the lower short term trendline, as outlined by the red arrows.
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Price broke out of the lower trendline soon after open today, testing and holding below this and other supports. I maintain a bearish outlook, but buying was very present today, and would not be suprised to see a hefty bull attempt to regain supports in the next few days.
would this be considered a rising wedge? I believe that one has formed on the SPX500 since Nov. 18th. There is also bearish divergence since then.
buff22
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Yes, that is a similar rising wedge, the chart just looks a bit different because the SPX500 chart includes the morning Thanksgiving day futures contract trading period, whereas the SPY, only traded on equity markets, was closed for trading on Thanksgiving day. The patterns, however work out to be about the same! The bearish divergence only helps the case for a break down. Thanks for pointing that out!