SPY Major Failed Breakout? [BEARISH]
The S&P500 has now found itself on the wrong side of what was once a potentially very bullish trade just days ago by breaking BACK into a bearish ascending channel pattern that SPY has been consolidating in since April.
In this chart, we zoom in on the 4 hour chart where only see a part of the ascending channel showing in red as a trendline.
This red trendline was broken and the S&P now find itself below the trend after getting rejected by a bearish wick. If bulls do not come in with bids, SPY will most likely see further action to the downside and that would be a dampening on traders after the excitement of gains in the market today.
Look for a retest tomorrow of 429. A close below that on the daily would most likely result in a retest of Monday's low, which would put the S&P500 at risk of confirming an extended downtrend.
It should also be noted that a key fibonacci level also is just above the price, coinciding with the 21 moving average as well.
In this chart, we zoom in on the 4 hour chart where only see a part of the ascending channel showing in red as a trendline.
This red trendline was broken and the S&P now find itself below the trend after getting rejected by a bearish wick. If bulls do not come in with bids, SPY will most likely see further action to the downside and that would be a dampening on traders after the excitement of gains in the market today.
Look for a retest tomorrow of 429. A close below that on the daily would most likely result in a retest of Monday's low, which would put the S&P500 at risk of confirming an extended downtrend.
It should also be noted that a key fibonacci level also is just above the price, coinciding with the 21 moving average as well.
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Please check my recent post "VIX Weekly Close Today Could Be Pivotal for S&P500" for an update on the most recent price action of this idea.
