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Did Stocks Just Pose a False Breakout?
A few weeks ago, we noted that stocks looked to be posting a false breakout.
A false breakout occurs when the market breaks out of a technical formation in one direction then fails to follow through on the move. Looking at the rising wedge pattern in the S&P 500 this appears to be happening now:
As you can see, stocks broke out of the rising wedge to the upside. However, this move looks to be rapidly losing steam. We’ve just seen a new lower high. And if the S&P 500 were to fall back below its upper trendline LOOK OUT: failed breakouts tend to resolve both quickly and violently.
Indeed if you look at stocks relative to Copper, there’s room for a REALLY bad correction here:
We’ve noted for some time that stocks had diverged sharply from the underlying economy. But this is a truly ugly chart. And if stocks ever begin to re-connect… it’s going to be BAD.
Investors take note, the market is flashing danger, danger. If you’re taking steps to prepare for a market correction already now is the time to do so.
For some basic steps you can take, visit us at:
http://gainspainscapital.com/protect-your-portfolio/
Best Regards,
Graham Summers
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this company must be paying to have their content here because its quality sucks
bob prechter calls that an "overthrow"? looking at the XAU on P&F, it hasn't given a buy signal since last september. not saying that would bring the market up with it, but i would sure rather be in the gold mining sector if the main equity market breaks down, and the xau flashes a buy. the xau can remain depressed for long periods, while the rest of the market tries to catch up on the down side (96-00). meanwhile you build positions and collect dividends. its not momo investing by any means
Even after yesterday's up-day, the $NYSI was still down...that ain't too promising, IMO:
http://scharts.co/159k056
When they went to the global Cyrus model of bank failure, the market's future was pre-ordained.
Technical, shmecnical.
I thought business insider said that the sell in may thingy didn't work?
Business Insider is edited inside their restroom. These same fucks report on hard-hitting news such as the Craptrashian/Frances Bean Cobain snit-fit...so I'd avoid their shit.....
I will not be running to Dr Copper if the S&P corrects "violently" or Japan has a financial meltdown. China obviously is slowing...it is Wall Street's job to take outrageous amounts of risk...that why the oil price has been "maintained" as "beyond belief high." it also explains why the QQQ's have been surging the past couple of months (taking all that liquidity to Wall Street as well.) so far the liquidity has been poorly used...financing a "barely recovering" recovery. These fictions can only be maintained for so long. I do fail to see how suddenly the world is awash in dollars as a consequence however. Aren't all of them already spent before they even leave the USA in the form of a trade deficit?
"China obviously is slowing..."
http://www.reuters.com/article/2013/05/23/us-china-economy-flash-pmi-idUSBRE94M02720130523
Short answer is yes.