All good things come to an end...
Needless to say SPY has been on an epic run for roughly a decade but as anyone of age knows all good things come to an end. The Fibonacci timing tool used in this chart uses two high points and a low in between them. The tool has been accurately predicting trend reversals but one week late 2 times in a row (look at how SPY reversed trend 1 week before the 1 extension and 1 week before the 1.27 extension. The 1.618 corresponds to the 23rd of Dec. implying on the 16th we may begin to see a reversal to the downside, lets see what happens. Thus far we are seeing negative RSI divergence (not included it the chart) and negative on balance volume divergence as well. We are also very close to 1.27 extensions of the two most dominant impulse waves of the index; 1 up and 1 down. I would not be surprised to see extensions that surpass the respective 1.27s and I can only be neutral at this time as my own analysis shows we are more than a month away from what could be the start of a correction at best or be on the cusp of a full blooded bear market at worst. All we can do is deal in probabilities. Please ask any questions and leave relevant comments. Thanks for reading.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.