Drew these lines last night, assuming we would most likely drop further. Been trying to think through arguments for 4900 or 4800 as possible bottoms. But interesting so far today with the 4950 area, which has some resistant/support background. Tested twice in February as support.
Still anticipate 4900 with fib level or 4800 with stronger prior resistance support. Won’t be proven today, but interesting. Nice VIX drop so far. This has also been an RSI bounce point in the past. Details in the finish.
Lakedog
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I’m recommending this post because it’s like finding a stream of fresh water away from the rage river of metar etc. Thank you so much Lakedog for pointing out the VIX drop in concert with the 2-month support level - in concert with a 3 day rise back above 40 in the S&P PAMA 50 and (finally) a 1-day bounce in the Naz PAMA 50. Hopefully this month’s “no rate cuts for you!” tantrum is over.
FC
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It is interesting to think in terms of expectations and expectation breakers. My expectations are that we will get a bounce from an oversold position, but then we will find resistance at the 50dma and it will take a while to get back above it. If my expectations are broken, I will rethink my plan, which is to not buy anything right now. Good reports from the MAG-7 could break or confirm my expectations. PCE is Friday.
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Hey Flying Circus, thanks but I’m feeling a little awkward. My goal was to simply generate some technical analysis discussion, not make a hard statement. I’m not a bull nor bear, but a student of the charts, still learning after all these years.
Yes, I am a bit encouraged by what I posted, but not totally convinced. As I said, the details are in the finish. And today, while closes are up and the VIX is down, it’s not convincing. Would have loved a big, fat marabozu bullish candle, but we got a non-descript oversized spinning top candle with average volume that screams indecision.
As I mentioned initially, the detail is in the finish. Here’s a 5 minute chart for the last three days that show a persistent down trend for the previous two days, but a hopeful upswing today with yet a final hour decline. But still closing positive.
Technical analysis does NOT tell you what will happen, but gives you hints as to the possible path. What I am seeing is that things seem to be attempting to change, but that it is not absolute. I did make a purchase today, but not a lot. It is not positive enough to make me commit to taking a lot of positions, but will watch. Still see 4900 and even 4800 as stronger positions for reversal, but will be thrilled if now.
How do you interpret it all?? What charts do you like to use to give you a clue?
Happy hunting,
Lakedog
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Hilarious - what a perfect summary of this situation!
What I see is indecision as well. If the schizos in charge of pricing (bots?) were to drive things back up we’d see a Zweig breadth thrust in the next 6 or 7 days - but I don’t expect that to happen. It seems to be a news-driven head-fake unpredictable trading market and that annoying little 5% drop was a shot across Powell’s bow. Hopefully not the first part of a bigger retreat; with earnings season we’ll see.
My chart following is very basic for 30+ years - MAs, crosses, moves with or without volume, relative strength - 101 stuff. More recently, PPO & DMI charts and index PAMAs (breadth) to highlight asset class shift at the index levels, weekly trend stuff. Not too much on individual stocks these days, just focus on high rev growth / earnings surprises. Love Stockcharts.
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