As we sit here Thursday morning before the U.S. markets open I thought I’d share an observation I’m watching for those that want to know.
As I expressed on the show recently this “market” has entered what I’ve termed a “manic/depressive” phase. i.e.. if the 2600 level thereabout holds of the S&P 500™ then things will go from gloomy to “Hey, let’s all BTFD!”
That has happened precicely as described.
Now we’re at the opposite end of that extreme where we’re now at the 2800 level and the “markets” appear to have exhausted itself getting here. And now it’s looking like they want to drift back lower. If they do, this will bring on the depression state aka “Sell it, we’re all doomed!” till we, once again, get back to that 2600 level thereabout.
The current “mania” phase has shown itself to exhaust precisely at another key level that coincides with that 2800, which is a near perfect, text book retracement pattern level shown via what is called a Fibonacci level, drawn using the beginning of the October swoon to the lowest level of it.
Should the “markets” not break up higher through here decisively then vault ever higher, the interpretations suggest that a retrace back lower is well in favor of the odds, where a testing of that 2600 level will be, once again, squarely back on the table.
This doesn’t mean that it will, it’s just something that can. But at least it’s something to watch for as to try and gain any insight into what may be coming back rather, than what I’ve heard professed across most (if not all) of the mainstream business/financial media. e.g., “The worst is behind us, it’s time once again to buy, buy, buy.”
Here’s a chart showing my observation and what I’m watching acutely. To wit:
As always, we shall see. But that’s what I’m focused on as of this writing.
© 2018 Mark St.Cyr