We finally got some short term correction last week. The question is whether we will get a strong bounce this week or not.
Intermediate
Spy Weekly
That test of the 50% fibonacci level don’t look good. $100 still looks strong support, which was formed with the 38.2% retracement from peak of the 2007 fall.
Some how the MACD high reading and the negative divergence bugs me. Have we really seen a bear market rally top here?
If $100 doesn’t hold then i am seriously considering that possibility.
EEM Weekly
Same looking charts for the EEM on the MACD front.
EWS Weekly
MSCI Singapore fails the 61% retracement test. If it wants to turn up so that it can move higher, now would be a bloody good time.
Daily
EWS Daily
We are at the 50 EMA on the EWS Daily charts and the green stochastics marked pink probably indicates that short term it has worked off quite a fair bit of the overbought conditions for the past 2 weeks.
Summary
The punters would probably try their luck. Many that have missed the rally that took many by surprise would try it but i would be careful here. Up or Down, the plan is to react according to what your analysis tells you. It would be a good trading test here to buy, but don’t expect big money if it doesn’t take out the major overhanging resistance.
The trend is still up. The question is how long more.
[…] that this could amount to something bigger. I have been commenting for the past 2 Trend Watch posts that the negative divergence and the ascending wedge pattern should eventually see more downside. The higher it climbs the bigger the […]