In March this year, i suggested "Sell in May and go away", based on a 15-year SPX chart. In May, the SPX peaked at 1220 right on the dot as shown on this chart. Now, it's make-or-break time for the S&P500. It is up against downtrendline resistance joining the Oct07-May10 tops, and overbought. Just above is the long-term trendline(red) that stopped the SPX dead in its tracks in May. Which way is it gonna go?
The answer may lie in this daily chart below. SPX is currently also up against the blue upper channel line.
Considering seasonality, chances are it will turn here. But if it does zoom up above those trendlines, the correction may have ended at point A, and we may be reckoning with a wave 3 up here with a test of the highs looming.
Look for a impulsive decline below 1130, or a continued surge above the downtrendlines.
All the best!
Posts
