Market is challenging OLD HIGHs and has violently snapped back in this month. No one was expecting this rally which was caused due to FED comments and earnings season. However, earnings is winding down and market has been ignoring cautious guidance provided by companies for rest for the year. Whats in store for us? BPNYA is well above 70 mark, MA(50) continues to drag downwards. Volatility ($VIX) is back to low levels and market is challenging OLD HIGHs. Why did we mention the last BUY trigger was suspicious? essentially because MA(50) is moving down and is also above MA(200), which makes this rally skeptical. On daily NYSE chart, it is clear that market is challenging OLD HIGHS and appears to be taking a pause before breakthrough the resistance OR will it breakdown!!! However on weekly NYSE chart, the emerging picture is telling different story. We might be looking at a Double TOP which is considered a bearish pattern, in addition to that we are also looking at divergence between price and MACD (shown by arrows). If the market is rolling over then we shall see early signs in next 2-3 weeks. What does it mean for our Investments?
Market gets benefit of doubt and appears to be bullish but be cautious... Comments are closed.
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