The S&P is creating another fishhook on the chart, but there are key things to watch. Don’t start getting too long just yet.
Back in May we saw the S&P make a dash through it’s 10 day moving average and then crab walk for a week or so. It never picked up the steam to get to or break the 50 day moving average or find the momentum to move the MACD above zero. IF (and yes the all caps are intentional) IF we are seeing a reversal we have a long way to go to get the kind of confirmation we would need to start looking at long positions.
If we get above 4,000, then it is time to start looking at every possible confirmation we can find of a reversal. Until then, hold on to your shorts. If you are in a short position, this is the type of move that will test your mettle.
Lee Gettess has some of the best tools to confirm when a trend is wiped out and is ready to reverse. If you haven’t seen his stuff yet, now is the best time to take a look.
Keep learning and trade wisely,
Market Wealth Daily