The buy climax and 39 moving average gap bar (small PB) bull trend is transitioning into a trading range, as the bears went for their breakout below. This is the biggest bar with a bear close since 2008.
Most likely is sideways to down price action over the next year, with a probable test of the all time high should we get a signficant downside swing. The major (lower) bull trend line is very likely to be tested, but this may occur by going sideways for a year or so.
Less likely, we get a strong bear spike selloff to test the bull trend line.
Bulls see this as the first demonstration of signficant selling pressure, as the bears are beginning to not only sell above resistance (limits orders) but selling below support (stop orders). Since the bulls are only willing to buy below and the bears are beginning to sell rallies, the market has transitioned into a trading range (tight range since November).
Support levels below are likely to find buyers and bears taking profits.
- The 13 month long tight trading range
- The moving average (20 bar EMA)
- The prior higher low
- The tight bull channel trend line
Most likely is sideways to down price action over the next year, with a probable test of the all time high should we get a signficant downside swing. The major (lower) bull trend line is very likely to be tested, but this may occur by going sideways for a year or so.
Less likely, we get a strong bear spike selloff to test the bull trend line.
Bulls see this as the first demonstration of signficant selling pressure, as the bears are beginning to not only sell above resistance (limits orders) but selling below support (stop orders). Since the bulls are only willing to buy below and the bears are beginning to sell rallies, the market has transitioned into a trading range (tight range since November).
Support levels below are likely to find buyers and bears taking profits.