There are a couple of things to watch as regards the weekly closes here. The most important is that SPX up channel. The last time we posted it was July 8 (no prices since then are shown):
The SPX needs to rally to at, or just above, today's open in order to be at that lower line -- around 1247 area. Will this be an afternoon of a surprise announcement to save the SPX (well, not to save it, but you get the idea). All such announcements are, in the end, about printing money. This has ceased to work after 30 years of working imho.
On the non-tech side, we have had an interesting 7 or 8 sessions, dominated by bear flags, sideways formations, and even a few dangerous broadening formations -- either way, this are formations that calm oversold and give positive divergences in indicators.
Yesterday, I did up this chart but did not get a chance to post it. It is an $XMI 60min, showing a broadening formation, which normally portends expanded volatility ahead (today's down price action is not shown):
Recall that $XMI is in a very interesting *possible* H&S setup I have posted a couple of times.
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No matter how bad the longer-term technical picture, the market has had lots of opportunity to flush, but it has not. We are where we were a week ago, torn between A-i) the very oversold condition + A-ii) the extreme sentiment survey results and B) the lack of real fear in the face of the sort of decline not seen in 6 years.
You do not need to trade this market. You can step aside until the odds favour a good trade. Right here, that is one of two things: a) extraordinary rise in prices or b) a real flush.
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Other things to follow here or other things that are interesting:
SPLS
That is some failure there. A breakout up from a very large triangle and then, yikes, a failure and follow-through to the down side.
WMT
Check out that formation here. As I type, price is right at two supports: the possible neckline and a backtest of the top line of the enormous coil (from, like, 2002) we have posted a few times.
DD
It is testing/failing out of the very large coil posted here a while ago. That would have implications I am sure.
MRO
Some very nice setups in oil related. MOR has plunged this week through its trend line out of 2002.
COP
Is it failing now after that rounded-top breakout through 11 months of horizontal resistance to new ATH over the last few weeks?
Financials
Just check some of those weekly charts. How many red bars in a row are there. You could live to be 90 and not see this twice. Is it 50% unwound yet?
CAT
and other industrials and diversified are telling us a story about the global economy imho.
Retailers
After some periods of holding up very well, some near ATHs, they are starting to disintegrate. |
