If we just based on this technical chart, I think we do have a case of a very overbought stock market.
Dow Jones was seen rejected at the peak of a 3-year expanding triangle and, at the same time, the peak of a 12-month rising wedge.
This phenomenon is very similar to last year's mid-February where the market peaked technically and plunged amid the coronavirus outbreak.
So fundamentally, we are still missing a catalyst like this pandemic and since the government is not going to stop printing money any sooner, we probably won't see another crash like last year.
However, a sharp pullback can still be expected as many investors might want to liquidate some positions at this point.
Therefore, this week we will give it a try to short when the price climbs a little higher and reach 31900.
Dow Jones was seen rejected at the peak of a 3-year expanding triangle and, at the same time, the peak of a 12-month rising wedge.
This phenomenon is very similar to last year's mid-February where the market peaked technically and plunged amid the coronavirus outbreak.
So fundamentally, we are still missing a catalyst like this pandemic and since the government is not going to stop printing money any sooner, we probably won't see another crash like last year.
However, a sharp pullback can still be expected as many investors might want to liquidate some positions at this point.
Therefore, this week we will give it a try to short when the price climbs a little higher and reach 31900.