Wednesday, 16 September 2015

S&P 500 forming a pennant, favouring fresh lows, though pattern may morph in to a flag

Daily chart of the cash S&P 500 shows the market clearly forming a pennant, a pattern which favours continuation of the down trend, and a move to fresh lows in coming days.

Next chart illustrates the top alternate scenario, that the pattern may morph in to a flag, which would require a rally. The market needs to rally through the top of the pennant before this alternative should be taken seriously. Til then, favour the pennant, but have plans in place for both scenarios.

Next a couple of charts of all sessions trade. The four hour chart illustrates parallel trend lines which have acted as both resistance and support since the peak.

Hourly chart.

Gold rallying from trend channel support, attempting to rally free from trend line resistance

Weekly chart shows that in late July Gold began a rally from trend channel support. Previous rallies from the nearby trend line have been good for 200, give or take. Why expect anything different this time?

4 hour chart zooms in to show price action since the July low. The Elliott Wave count remains bullish, and Gold is attempting to rally free of trend line resistance.