AK Steel (AKS) recently sold-off sharply after breaking down from a daily triangle pattern – a great example of the concept.
Let’s take a look at the daily chart then see the damage done and potential support level to watch on the weekly frame.
With April 28th’s Fed decision to keep the Fed Funds rate unchanged, let’s take a look back on the last 10 years to see the relationship between the Fed Funds Rate and the S&P 500 … which might be very surprising to you.
For the third time in the last few days, we’ve broken slightly under the rising dominant trend channel as seen best on the 60-min chart of the S&P 500.
So far, that channel has held, but today, we’ve broken slightly under the channel so let’s take a hyper-focus on these price levels and what to watch:
The S&P 500 began Monday April 26th on a push to new recovery highs, but it did so laboriously, forming negative divergences in all three key market internals we monitor.
With that in mind, let’s take a look at current lunchtime market internals in the S&P 500 for April 26:
With Goldman Sachs (GS) frequently mentioned in the news in the wake of the fraud allegations, intraday traders have sought to profit from the swings and price movement that has occurred since GS fell so sharply on April 16th.
Let’s take a look at the ‘wakes’ or aftermath of the sell-off, failed ‘bounce,’ sucker gaps, and current breakdown from the descending triangle that formed.
Let’s take a quick look at the rising trend channel lines ‘auto-generated’ from the Andrews Pitchfork charting tool to note where we’ve come and where we are now between these lines.
Reading Market Internals is essential for intraday traders and also is helpful for swing traders, if you compare days to days and swing highs to corresponding internal highs.
Let’s get an update for April 21 and then also note the three recent clean divergences – all of which have produced a turn in the market place.
You know I’m a big fan of studying price patterns and looking for those patterns to repeat, and it appears that we have a near-identical repetition – on a smaller scale – of the move down and rally from the February low, which has played out over the last few trading days.
Let’s see them and compare.
Just when it seemed like this market would continue its journey to the moon, we had a major one-day (at least) snap-back in price that erased the gains of the last week, plunging us in one day to an intraday low price not seen since last Thursday, April 8th.
The prior “Arc Update” posts have generated a lot of attention, and I wanted to continue that series with updated charts that answers a question that a few readers have asked:
“What would the arcs look like on Logarithmic Charts?” instead of the default arithmetic charts I’m showing.
Reference back to the prior updates for comparison, especially: