Topping Formations, 4 May 2023
🖼 Daily Technical Picture 📈
➤ Equities continued to sell-off but not aggressively. It wasn't the kind of impact we have had on previous interest rate decision days. That being said, futures are down further in Asian trade.
➤ Let's have a look at the last couple of topping formations of the SPY at previous peaks in Dec 2022 and Feb 2023. If we have just witnessed another peak we might be able to gain some insight on how this may play out in the immediate future.
➤ We saw two types of topping formations. Dec 2022 was a double-top with a failed upthrust at the second peak. Feb 2023 was a common topping process where there was a failed re-test of the high.
➤ The current "assumed" peak could be a replay of either scenarios as described. It can also be a third process where price continues to fall without any attempt to re-test the high. The price action signals a "rush for the doors". This is less common. It would be similar to the Aug 2022 peak. What we should expect to see is price gapping lower to reflect an acceleration downward.
➤ I remain long with a small position.
➤ Conclusion: 🐆 Have we peaked? May the 4th be with You.
EQUITY TREND:
⦿ Short-term (weeks) - UP
⦿ Medium-term (< 6 months) - UP
⦿ Long-term (>6 months) - DOWN
➤ Equities continued to sell-off but not aggressively. It wasn't the kind of impact we have had on previous interest rate decision days. That being said, futures are down further in Asian trade.
➤ Let's have a look at the last couple of topping formations of the SPY at previous peaks in Dec 2022 and Feb 2023. If we have just witnessed another peak we might be able to gain some insight on how this may play out in the immediate future.
➤ We saw two types of topping formations. Dec 2022 was a double-top with a failed upthrust at the second peak. Feb 2023 was a common topping process where there was a failed re-test of the high.
➤ The current "assumed" peak could be a replay of either scenarios as described. It can also be a third process where price continues to fall without any attempt to re-test the high. The price action signals a "rush for the doors". This is less common. It would be similar to the Aug 2022 peak. What we should expect to see is price gapping lower to reflect an acceleration downward.
➤ I remain long with a small position.
➤ Conclusion: 🐆 Have we peaked? May the 4th be with You.
EQUITY TREND:
⦿ Short-term (weeks) - UP
⦿ Medium-term (< 6 months) - UP
⦿ Long-term (>6 months) - DOWN
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✅ Copy My Trades @ eToro, etoro.com/people/mrstocky
✅ Verified Track Record 📈
Not Investment Advice
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