S&P is breaking above the short term resistance at 1660-65 and is heading towards 1680. Are clear of the danger or is this another fake break out like the one in June? Prices have fallen in an pattern from 1709 and we believe this upward corrective bounce will soon end. Bulls should be very cautious and raise their stops as we believe that another leg down that could push S&P towards 1600-1580 is very possible according to our analysis.
If you sell right now or wait for 1680 or sell once support levels are broken depends on the risk profile that is different between traders. Here we just provide a basic guideline according to our Elliott wave analysis on what to expect next and which levels should be considered important when trading. Support at 1650-40-30 is the cushion for bulls. Once this support is penetrated we should see a sharp move towards 1600-1580. The chances are high that something similar to last June could happen. We are not end of the world believers but we do feel a sizeable downward correction could be triggered in September.
As always, thank you for taking the time to read my new post.
A term used to describe a trader who is expects that a particular asset – be it a commodity, currency or product – to rise in value. The opposite of a ‘bear’.
The idea is that bulls attack by bending their heads and poking their opponents upwards with their horns, symbolising the fact that they are buyers, driving prices up.
Beliefs held by the aforementioned ‘bulls’ of the trading world, are described as bullish. Characterised by a generally optimistic outlook on the state of a given asset, a bullish outlook would suggest that a rise in value is imminent. Opposite of bearish.