The stock indexes gapped up out of the triangular trendlines today, creating an initial upside breakout. So maybe there will be an extended run up from here.
On the other hand, the weekly stochastics are overbought and the daily stochastics are overbought, and the hourly MACD has bearish divergence in overbought territory creating a nice set-up for a large downside move.
Additionally, the Dow has touched its upper daily bollinger band today, and the S&P 500 is just below it. So on a statistical level, the market is close to overbought, though trending upward moves tend to hug the upper band, so this doesn't mean it won't continue higher.
The last 3 times the S&P 500 touched the upper band, it topped 4 days later, 4 days later, and that same day respectively. So if we remain in a downtrending environment, expect a top within the next few days.
Watch for any bearish reversal candlestick at the upper bollinger band here as a clue that this may be a false breakout.
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