Quite simply, what we THOUGHT was a Sideways Range was NOT actually a Sideways Trading Range.
What’s changed our thinking and what does it mean about the current state of the coiled stock market?
Let’s take a look:
First, let’s build off an assumption that we’re challenging.
I’d multiple times recently assumed that the S&P 500 was “coiling” or trading within a well-defined sideways rectangle (horizontal trading range) which was similar to that of January (ahead of February’s breakout).
The quick expectation from those posts was that price would continue bouncing sideways in a sideways trading range.
In reality, what we’re seeing is NOT a Sideways Rectangle Range but instead a RISING, compressing trendline pattern similar to a Rising Wedge.
It makes a big difference, given that a simple breakout beyond a sideways resistance high “should” lead to an impulsive bullish breakout like that of February. Continue Reading…