Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
Interesting morning, we have some ok equity action even as the two “risk off” indicators of the recent rally are both up – bonds and the yen. Someone is lying….
As for the S&P 500 it is working on that “right shoulder” if you believe this is a head and shoulders top formation. The last two major trends that rolled over showed a period of indecision and upward thrusts (April/October 2012) that never reached the former high. Those led to major reversals in May and November respectively. If this is a similar pattern the upward thrusts of the current time frame should not create a new high but continue to cause hope for the Pavlovian dip buyers, before an eventual roll over. We shall see if this is the pattern it is creating. A move over 1528 would make this theory defunct.
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