Current Position of the Market
S&P 500: Long-term trend – Bear market
Intermediate trend– Bear market rally
Analysis of the short-term trend is done on a daily basis with the help of hourly charts. It is an important adjunct to the analysis of daily and weekly charts which discusses the course of longer market trends.
“…it is becoming increasingly likely that the initial low of the bear market will occur at about 2600.”
That forecast published in last week’s letter turned out to be correct, as S&P 500 made a climactic low at 2604 and immediately rallied 70 points in two days to seal the bottom of the A-wave of the bear market. This was followed by the typical backing and filling which comes after such a move. The retracement was about normal, a little less than 50% to 2640 before the rally continued another hundred points to 2741; until last Thursday where, for all intent and purposes, it should have topped had it not been for some very timely positive news about the trade war released by the administration. This had the effect of pushing it up to 2756 on Friday’s opening, after which it reversed exactly 3 hours later and started a correction down to 2700 before finding support and consolidating until the close. Volatility has not gone away!
Read more at : https://www.investing.com/analysis/countertrend-rally-200354565