Wednesday, September 5, 2012

S&P 500 ~ Pre-Market Warm-Up ~ 5 September 2012

In this post I showed you what usually happens after the SPX hit a new high. So far, this pattern has worked really well as the market corrected about 30 handles from the high.

The similiarities between the first occurence of this pattern (see chart in the link above) and today are striking:

The SPX and the ES in 2010:

The SPX and the ES today:

So, if the triangle breaks up, we might not only get to new highs but rally to much higher levels (1500+), similar to what happened in 2010.