Is More Correction Needed?

But first, SPX will have to break the second black trend line shown on the chart. Also, if 3830 is exceeded, the decline could continue down to the blue 50-dma (~3778), which is also located at the bottom of the rising channel.  

SPX Hourly Chart 

SPX made a new all-time high and started to retrace. There are several valid support and resistance lines drawn on the chart which, as you can see, are all capable of pointing the price action either upwards or downwards.

After the decline found initial support at a previous low, the index rallied and failed to surpass the top red resistance line, and then the top red channel line -- which held for four hours on Friday and finally repelled prices into the close – so we can pretty much conclude that the correction is not complete. But this will have to be proven with a break below both the black trend line and the red horizontal support line which held last Thursday.  

There are other trend and support lines drawn lower which could indicate where the correction will end. My preference, which is expressed in the daily chart analysis, is in the vicinity of 3830, which combines a 50% retracement, a P&F count, and support levels. Should we go beyond, adjustments to the analysis will be provided in the updates.

Another possibility is that the index will find support, at least temporarily, on the magenta trend line. We will know better early next week. The oscillators are indecisive.

UUP (Dollar ETF) Weekly Chart

It looks as if UUP is being repelled by its intermediate red channel line, and it will have to do some additional basing before it can go through it.  

GDX (Gold Miners) Daily Chart

GDX is in the vicinity of an important cycle low which should end its consolidation. I had expected this low to come last week, but this week is good enough. There could be one small, climactic spike down, but it is not necessary, and if that should occur, there is important support directly below which should limit any further weakness.

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Charts courtesy of QCharts.

The above comments, as well as those made in the daily updates and the Market Summary about the financial markets, are based purely on what I consider to be sound ...

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