US Equities Set To Run
The Dow appears poised to run to the apex of its ascending wedge pattern to the 61.8 Fibonacci retracement level and its first zone of significant horizontal resistance. Daily RSI should also be in the 75-80 overbought zone by that level as well.
Note that it recently broke and then retested the downtrend from the bear market/financial panic and then retested it while consolidating in the area of its 50% Fibonacci retracement level.
The NDX may accelerate to the top of its red uptrend channel into horizontal resistance in the 2060 area. It has recently broken out of a lateral consolidation, flagged and then broke out again. Tech stocks are once again taking the lead, an overall bullish development for equities.
The SPX is also targeting its 61.8 Fibonacci retracement level which will correspond with a zone of horizontal resistance as well as the top of its trend channel and overbought daily RSI readings of 75-80.
The current period may witness an upside capitulation as bears throw in the towel for good and sideline money gives up on waiting for lower prices. This will no doubt be accompanied by a bullish media consensus as well as excesses of bullishness in key indicators such as VIX and the Put/Call Ratio. Naturally, it will likely be just at the apogee of bullish delight that the market will top and a significant correction will set in. What kind of a top would this be? Who knows! I sure don't.
The US Dollar Index has met very long term resistance in the 78-79 zone and the "Dollar Carry Trade" should resume for a time, further fueling the speculative fires that will carry equities markets to the aforementioned targets. I expect a higher low to be put in but it will likely be a lengthy, convoluted process and probably not easy to trade.
Note that it recently broke and then retested the downtrend from the bear market/financial panic and then retested it while consolidating in the area of its 50% Fibonacci retracement level.
The NDX may accelerate to the top of its red uptrend channel into horizontal resistance in the 2060 area. It has recently broken out of a lateral consolidation, flagged and then broke out again. Tech stocks are once again taking the lead, an overall bullish development for equities.
The SPX is also targeting its 61.8 Fibonacci retracement level which will correspond with a zone of horizontal resistance as well as the top of its trend channel and overbought daily RSI readings of 75-80.
The current period may witness an upside capitulation as bears throw in the towel for good and sideline money gives up on waiting for lower prices. This will no doubt be accompanied by a bullish media consensus as well as excesses of bullishness in key indicators such as VIX and the Put/Call Ratio. Naturally, it will likely be just at the apogee of bullish delight that the market will top and a significant correction will set in. What kind of a top would this be? Who knows! I sure don't.
The US Dollar Index has met very long term resistance in the 78-79 zone and the "Dollar Carry Trade" should resume for a time, further fueling the speculative fires that will carry equities markets to the aforementioned targets. I expect a higher low to be put in but it will likely be a lengthy, convoluted process and probably not easy to trade.
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