Two weeks ago I showed a very simple chart of the 5 major US indices (S&P500, DOW, NYSE, NASDAQ and Russell2000 (RUT)), with a very simple technical analyses (TA) based on simple support and resistance trend lines put in place since the markets fell of their All Time High (ATH) chairs.
Two weeks later and let’s see where the indices are now.
What we can observe is that the DOW and NYSE continue their breakout with a, so far, successful retest of the breakout by the DOW. A relapse below their respective black dotted descending trend lines is Bearish, and a breakdown below the green dotted Support lines would be very Bearish. But for now: so far so good.
The S&P, NAS and RUT were all three stopped at the upper black trendlines and continue to move inside the “noise zone”: between Support and Resistance. These indices need to breakout to support the Bullish case, while a breakdown below Support can swiftly lead to much lower prices (2400s on the S&P. Hence, since simple is based (KISS) we’ll continue to monitor the price action in regards to these trendlines. As I concluded in this week’s market digest for my premium members, albeit based on several more lines of evidence, there are thus no strong signs yet that the market correction is over and the possibility of a breakdown can still not be ignored. But the technical analyses (and Elliot Wave Counts) still favor an upward resolution out of the current range bound, and frustrating, markets and a resumption of the Bull trend to new ATHs. Until then a healthy dose of caution is advised.
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