5 out of 9 sectors are in the process of forming bearish continuation flags (to the downside). The other 4 are forming symmetrical, ascending, and /or descending triangles. Although these sectors are the strongest, they will stay within a range until a clear direction is determined. Most volume and outlooks are bearish and I wouldn’t give any individual sector a “bullish” outlook given the continued consolidation.
The point is that we can’t hang around in the tight range here at the bottom. This is 100% bearish and will be the precursor to another leg down if #1 and #2 are not accomplished. In this market, each day counts.
4 comments:
What do you think the effect on sentiment will be if we break the 2002 lows? Also, how likely do you think it is that we will eventually break those lows?
Sup Panda. I don't have a crystal ball, but what I can say is that we have to gain 4-5% in the markets tomorrow and follow-through the next few days, otherwise, it's over. The sentiment would be what you think it would be - disastrous.
To make a shoulder all that money defending the bottom will have to spike big and then defend higher. Those selling to cover and to meet obligations could ease off and go short into buying strength at 1000, allow a higher low and munch again on buyers at 1100 etc. Or, the cashing out just never stops, just throwing out an alternative..
this range trading is definitely supposed to frustrate people and force them to exit the market. This is a multi-week washout session.
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