Market is currently trading in a narrow range and providing mixed signals testing everyone's patience. Is this formation of a perfect storm!!! Is this market going to surprise all of us? BPNYA finally dropped below EMA(30) after dancing around it for couple of times. Volatility ($VIX) is also dancing around giving mixed signals. NYSE daily chart shows that market is trading in a narrow range. NYSE weekly chart is suggesting a possible topping pattern as market is unable to break through the resistance at the HIGH. RSI has slipped below 50 mark and both RSI/MACD are trending down. NYUD is yet to break out to NEW HIGH and could not overcome resistance from earlier HIGH. Also NYUD appears to be barely hanging on to EMA(21) line for now. Although RSI is still above 50 mark, it is trending down. Based on above charts, it may seem that market is trading in a range for now but it is highly probable that the breakdown is coming. It is better to be prepared than be surprised. The bigger question should be, Will it be a drop and pop the way we saw in October 2014 OR Will this be change in market character? We will discuss this in more detail in a separate post. For now be prepared for further downside in the market and if market surprises us by breaking into NEW HIGH then that would be the ideal time to enter to stay in the game.
What does it mean for our Investments?
Market BULLs gets benefit of doubt but be very cautious... Comments are closed.
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