US indices have staged another upward move from April 22nd trying to make new all time highs. The corrective decline that happened before this upward move, tested the intermediate support levels giving an even bigger importance to those levels. However only S&P managed to make marginal new all time highs, but most other indices did not have enough power to test their recent highs. Although the patterns in most indices and ETF’s are overlapping when it comes to downside potential, the form of the decline with and lower highs implies declining power from the buy side.
The rise from past November is clearly finding it hard to continue as it has most probably finished 5 waves up and need to make a correction. Top formations take time to complete whereas bottom formations usually are spikes.
DOW as shown above did not manage to make new all time highs. However the short term support still holds and so does the important support level at 14400. On the other hand, S&P as shown below made marginal new high but reversed and fell below short term support.
Next support level is found at the lower Keltner channel at 1578. Again here it is important for the longer term trend to remain bullish, prices to hold above the 1540-35 area. Another test of that area will most probably will be the one that breaks this level and opens the road for prices to reach 1470-90 area.
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