SEE UPDATE BELOW…
Note this is an HOURLY chart of the SPY about 3 hours before the close on Friday, November 17. Please orient yourself to previous posts on the channels still indicated on the chart from previous posts if you need to, but the pink uptrend channel has been in place for many weeks and price finally dropped out of it. A salmon colored downtrend channel was created over the past week or so and was well defined until yesterday. Price popped above the salmon channel and bumped back up against the pink channel. Now price is stuck between the two. I fully expect one more tag of the pink channel lower boundary today into the close or early next week. That should create an all time high again on this SPY product near $260.
If the market is going to head lower from here, this is a very technical pattern known as the “kiss goodbye” when price leaves a channel or trendline and then rallies back up to tag it before falling away. Entering the pink channel and staying above it would be bullish, entering the pink channel and falling back out would be bearish, and rising up to tag the pink channel from the underside before falling away would be bearish. The bears have 2 out of 3 scenarios in their favor….except the overall trend is UP, so the bulls likely still have the odds in their favor.
Have a great weekend everyone. There are some initial subscribers reaching their renewal period this month (this site was launched in Nov 2016) and I hope you have found value in staying on the right side of the trend. 2017 was a good year in the markets…I trust you made some good money on your investments! Thank you for your renewal when it comes due. As you’ve seen, I’ve been pretty busy posting long and short term thoughts on the market. I hope they help!
UPDATE after the close on 11/21/17:
Same hourly chart advanced by 2 days (Monday and Tuesday) showing that price did indeed rise to tag the pink channel from underneath as expected in the post above and setting a new ATH (all-time high) on the SPY product [red arrow]. Is this the “kiss goodbye” or is this a rest before jumping back into the pink channel? Tune in tomorrow and Friday (the market is closed on Thursday for Thanksgiving) for the answer. Very interesting development…let’s see how this plays out! Happy Thanksgiving everyone. Enjoy your families and friends.