Overall, these setups continue to warn of a reversal, but as of right now, we don’t have any confirmation that the bullish trend has ended. We will warn that any future breakdown in price below this Island price formation would be a very clear indication that the bullish trend has stalled and a new downtrend may be setting up.

There is another type of Japanese Candlestick pattern that this resembles, which called a Scouting Party. A Scouting Party pattern is established when price moves above resistance or below support in an attempt to secure new price highs or new price lows – but fails to hold these price levels over time. This is also indicative of an attempted price trend that fails and results in a price pullback/correction.

Right now, the market price in the SPY and SPX is “scouting for new support." Keep your eyes on the magenta resistance levels as price continues to try to retain these new highs.