Click on Chart to EnlargeCheck the notes on the chart. The solid blue line is where I have the last leg up starting (Feb-May) from a pattern standpoint. If this is a new downtrend, I would expect that to be retraced in less time than it took to form. That is what the blue box represents.
The typical post crash type pattern is a volatile rally followed by a decline to and usually below the crash intraday low. The stops built below those levels get cleaned out usually before the next rally. We can be there will be stops below that low and also obviously already built below the Feb low. So I myself kind of expect that low to be taken out before the first multi week rally attempt.
One interesting thing that happened around this last top is illustrated by the following chart:
Click on Chart to EnlargeThe TICK values on the Nasdaq started going wacky right the top. Those type of readings were never seen before. When that first started I was wondering if it was a harbinger of something to come because the TICK is driven buy the program trading buy and sells. It seemed like something too obvious.......but coincidence only?
As long as we stay below Thursday's highs, bet against any rally. I will continue to hold the SPXU right now, because I feel the odds are good for some further downside. There is no bullish divergence even on the hourly chart (of SPX) yet, and there is no candlestick reversal pattern.
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