Originally Posted on InformedTrades
Below is a weekly chart of the S&P 500. What stands out a bit is the last candle, which represents theprice action over the past week. It was the largest weekly high-to-low decline since June 17 of 2013 -- justshy of 18 months ago.
This decline puts us at the bottom of the weekly channel going back to mid-January of 2013. However,that channel was broken in the down move that occurred in the week of October 6, 2014 -- a weekly decline that was almost as large as the decline we saw this week. That setup a megaphone pattern,illustrated by the blue trendlines on the chart, that we also discussed previously. If that pattern plays outand this week's decline is a step in that direction, that gives us a downside target of around 1770.
Personally, I think it would be a good time to take some profits on, but leave some on as I think equitiescould still go much higher if capital flees bonds over the next few years.
What do you think?
Below is a weekly chart of the S&P 500. What stands out a bit is the last candle, which represents theprice action over the past week. It was the largest weekly high-to-low decline since June 17 of 2013 -- justshy of 18 months ago.
https://www.tradingview.com/x/bItU9Q4Q/
This decline puts us at the bottom of the weekly channel going back to mid-January of 2013. However,that channel was broken in the down move that occurred in the week of October 6, 2014 -- a weekly decline that was almost as large as the decline we saw this week. That setup a megaphone pattern,illustrated by the blue trendlines on the chart, that we also discussed previously. If that pattern plays outand this week's decline is a step in that direction, that gives us a downside target of around 1770.
Personally, I think it would be a good time to take some profits on, but leave some on as I think equitiescould still go much higher if capital flees bonds over the next few years.
What do you think?