E Bank Stocks Resistance May Slow Down The Stock Market

Today we will talk about stocks, where we see an interesting potential top formation, at least a temporary one.

Stocks, specifically S&P500 is in an impulsive rally and it's hitting all-time highs every day, but this may come to an end soon since we noticed a completed corrective (A)-(B)-(C) rise on bank stocks right at the important 78,6% Fibonacci retracement and clearly within an ending diagonal (wedge pattern) for wave (C).

As you can see, bank stocks chart is at a much slower pace than the stock market, but it's in a tight positive correlation, so we believe that once banks stocks start sharply falling, this is when S&P500 may face a top, but probably only a temporary one. So, carefully and be aware of a limited upside.

Be humble and trade smart!

(Click on image to enlarge)


Disclosure: Please be informed that the information we provide is NOT a trading recommendation or investment advice. All of our work is for educational purposes only.

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