Good evening, traders. We’re now entering our seventh week in the range.
We can still direct our attention towards several major features on the S&P 500. There are two rising wedges (one very big, the other smaller), the trend line from the August & February highs which we’ve clung to like our lives depend upon it, and the sideways range we’ve been in:
There are only two ways this can resolve. If they want to squeeze the bejeezus out of everyone, they can certainly break it up and test those upper rails of the wedges:
This will remain a possibility. I think it’s the less likely one. So let’s look at a couple versions of the other way it may resolve. This weekend I discussed an idea of a little upside, which we may have sort of done part of today. Let’s look at that thought again now.
Plenty of things can happen, and we’ll have to see. I have my favorites, but I’m open to variations.
I’d like to now look at Bitcoin briefly. It’s done something that I suggested it might do this weekend.
It continues to act like it’s rejecting this very important long-term trend line that has supported its bull market:
Now what I said this weekend was in regards to a more local structure we can see. I said that we had
So we’ll see how that goes. Things continue to look good for the bears on that front.
Let’s look again at the Russell. I think it’s especially important to track right now, largely because of the banks, etc.
It remains in this ascending triangle, that might be a bear wedge, it still hasn’t lost these two major prior highs, and it’s even got what might be a little bullish wedge in there now, to boot:
So, we’re waiting to see how these will resolve. Ascending triangles can be bottoming formations, but as this one took place place after the steep decline in March, it’s quite possibly also interpreted as a kind of bear flag.
One hopeful point for the bears could be this, something a little more visible on the Russell futures.
Ok, so, there’s still a good setup for the bears in many places. I’ve touched on just a few here tonight. We’ll have to see how it goes. All possibilities remain on the table until we exit the range. I have my favorites, but anything can happen.
I hope everyone has a wonderful evening.