S&P 500- Could be dangerous place for selling to start!

The trend in the S&P 500 remains up, as it is above long-term moving averages and is in a solid rising channel in the chart below. The little bit of softness that has taken place of late has done nothing to change that trend.

The Power of the Pattern wanted to share with you this morning a key test to the bull trend in the chart below-

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The S&P has remained inside of quality rising channel (1) since the 2009 lows. The top of the channel was touched back in late 2014, where it then embarked on sideways to downtrend until it testing the bottom of the rising channel in 2016.

The strong rally since testing the bottom of the channel in 2016, now has it testing the top of the channel at (2).

This could be a dangerous channel resistance test for the bulls if selling would start, especially as the number of assets invested in the 2X long S&P ETF is near record highs!

 

 

Why you see chart pattern analysis with brief commentary:   

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Doc Copper; Breakout test in play

Ole Doc Copper hasn’t done too well over the past 6-years, as it has created a series lower highs since 2011. Over the past 18-months, Doc has been attempting to create a series of higher lows in the chart below.

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Copper appears to be creating these short-term higher lows inside of rising channel (1) and (2). Rising support channel (2) is being tested and short-term falling resistance is in play at (3), creating a short-term pennant pattern.

Below looks at Copper over the pat 30-years-

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Copper has spent the majority of the past 30-years, inside of rising channel (1), where support was hit 18-months ago and the series of higher lows got started. It has spent 100% of the past 6-years inside of falling channel (2).

For the past 6-years, Doc Copper has let down the bulls, as it has peaked at falling resistance, as resistance is resistance until broken. To send a positive message to the bulls, it needs to breakout of falling resistance at (3). If it does breakout, I will look to be a buyer. This is where Copper has peaked year after year, will it be different this time?

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