Wednesday, August 16, 2017

SPX, NDX, INDU Updates: No Suprise

Last update discussed some pending resistance zones, as well as what we might expect if those zones were breached.  For NDX, I wrote:

We'll start with NDX, which tagged its first upside resistance area on Friday, and will enter into no-man's land if it clears that zone.  Next meaningful resistance isn't until the mid-point of the previous range

NDX cleared first resistance and then sailed, virtually unabated, into a direct tag of the second resistance zone -- a distance of more than 70 points.  Hopefully bears were well clear of that rally, in light of the warnings on Friday and Monday:

SPX hasn't moved quite as far into its resistance zone, but is presently back inside the old black channel:

INDU has continued its bounce from the blue support line:

In conclusion, bulls turned everything right where they needed to and thus have kept their hopes alive for the time being.  On the bright side for bears, the wave pattern gave ample warning of a pending bounce, and confirmation that the bounce would continue, which allowed bears to get free with some decent profits.  I'm hesitant to advise much here, because this pattern is now firmly into "could go either way" territory -- but if one is bearishly inclined, retests of the zones near the ATHs would entail the lowest risk, at least in terms of stop levels.  Trade safe.

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