Is the Triangle Becoming a Channel?
A lot of bullish things have happened on the S&P 500’s chart in recent weeks. It bounced at 3,000 and its 200-day simple moving average (SMA) twice. It’s also had a “Golden Cross,” with the 50-day SMA rising above the 200-day SMA.
But one thing it hasn’t done is BREAK OUT. The index has now gone 28 sessions without closing at a new high. It’s the longest stretch without a new closing high since the market started bouncing in early April.
This may create a new risk: What if the apparent bullish triangle turns into a sideways channel?
It’s also worth noting that the recent highs around 3235 roughly mark a positive versus negative YTD return. (2019’s close was 3231.) In addition, this area was a low in early January and late-January/early-February. In other words, it was the last clear support immediately before the Covid selloff began. Is it now becoming resistance?
But one thing it hasn’t done is BREAK OUT. The index has now gone 28 sessions without closing at a new high. It’s the longest stretch without a new closing high since the market started bouncing in early April.
This may create a new risk: What if the apparent bullish triangle turns into a sideways channel?
It’s also worth noting that the recent highs around 3235 roughly mark a positive versus negative YTD return. (2019’s close was 3231.) In addition, this area was a low in early January and late-January/early-February. In other words, it was the last clear support immediately before the Covid selloff began. Is it now becoming resistance?
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