Brace for impact, stocks for sale
Dear readers,
Welcome back to the Patellic Newsletter, where we provide technical and sentimental analysis about financial markets. On top of that, we deliver crucial market information that can influence financial markets to be always a step ahead of major market movements.
We found something useful in the charts today what can help you decide if you want to buy or sell stocks today or in the near future.
S&P 500 Index, 1D
Right at the beginning of 2022 we started a 385 day bear market by making lower lows. The market fell because inflation was going through the roof and central banks all around the world started rising interest rates to cool off the economy.
Since then S&P 500 finally broke through its main downtrend in January, sending stocks up for a couple of weeks. Bearish sentiment flipped in an instant with more and more people becoming bullish on the market, especially in the tech-sector and speculative stocks (outperformed the S&P 500).
Even economic journalist’s on television mentioned the start of a new bull run and we would likely not see the lows of last October again since we broke the big downtrend line.
Well, we at Patellic are now not so sure about that outlook, since the index is making a rising wedge, a bearish pattern on the daily timeframe.
While bears (people betting on the downside) are quiet and hedging/covering their short positions with the latest market move up. We believe that the bears are finally getting what they want, a big market crash.
If the index breaks below the support of the rising wedge pattern and breaking the main downtrend line in the coming weeks, we expect much more downside in the market. However we can make another swing high in the rising wedge pattern, this would only delay the inevitable downturn.
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