Courtesy of Chris Kimble.
Below looks at the S&P 500 over the past couple of years on a weekly closing basis. The S&P hit a key level around 6-weeks ago and continues to “back off!”
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The Power of the Pattern applied Fibonacci to the 2016 “weekly closing highs and lows” at each (1), then applied the 161% extension level to them.
SPY hit the 161% extension level around 6 weeks ago, at the 238 level and has proceeded to create a series of lower highs, while breaking a steep rising support line at (2). This line was created off the lows at the time of the election.
Since hitting this key resistance level, the S&P 500 has created a series of “bearish reversal patterns/bearish wicks,” three out of the past 6-weeks! See post discussing bearish wicks HERE
Until the S&P can take out the 161% level, it comes into play as the 800 pound resistance zone.
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