After yesterday's dismal employment report, pundits have started pronouncing the green shoots mantra dead and buried. Technically though, things are not that clear. Even after yesterday's brutal sell-off, we are still above significant support areas. As can be seen in the chart above (click to enlarge), the S&P500 might be in the process of forming a Head and Shoulder formation (the neckline is the blue line in the chart) but for the (bearish) H&S to be completed, the index would have to break 888 decisively. And even if it does, there is still that line-in-the-sand support above 875 to contend with (orange line in the chart).
So, granted the momentum has turned quite drastically and there are a lot of scared bulls out there as well as highly motivated (and well-capitalized) bears, but the war between those two groups is still going on and the outcome is not yet clear.
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