It has now been exactly 10 months since we established 2410 as the measured objective for the S&P 500. In forming a potential double top this week at 2405.77 I’d say we are close enough to call the target in (as we did in February when the first top was made on what we called ‘peak Trump’ day, post-congressional address).
Now, a target is not a stop sign; in this case it was a long-term objective based on a chart pattern, period. It could make me look like the genius I certainly am not, or it could just pause at the target on its way to further upside mania and a potential market blow off. Don’t let ’em baffle you with bullshit, nobody knows which of those, or whatever else may be in store.
For instance, this could just as easily be a bullish Ascending Triangle (sloppy though it is) as a bearish Double Top, which would not be activated unless SPX makes a lower low to the April low… period. Macro fundamentals and valuation are not technicals. On the subject of technicals, there is an ongoing bearish divergence by MACD and RSI, so that’s something at least for the bear case. But the trend is bullish until it no longer is and that applies to this daily view as well as longer-term views beyond the scope of this article.
This post was published at GoldSeek on Sunday, 21 May 2017.
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