If we take a step back for a second and go way up the timeframe arpeggio to the monthly view, we have this pretty nasty looking chart staring back at us.This monthly chart of the SPY (click to enlarge) with its attendant MACD indicator leaves no doubt as to where we've been (the glaring double-top) and where we could be headed as things stand now (the late 2002 lows around 76).
Obviously, things could change but reversing the built-in momentum present in this monthly chart will be a long and arduous affair. No one-day (or one-week or one-month) reflex rally will be enough to undo the damage incurred over the past year. Only a sustained rally above the May high above 145 could begin to spell the end of this bear market, maybe. What's most troubling is the striking similarity so far between this bear and the 2000-2003 one.
2 comments:
Totally agree with you...and the similarities are getting more ominous each day. We wrote a very similar piece on June 18th using the weekly S&P. If you get a chance take a look at the quarterly chart in our post from July 3rd...it can get much uglier!
Keep up the good work.
technicalinsights.blogspot.com
Thanks, much appreciated.
Great posts on your blog, very convincing.
I agree things will probably get uglier and may take a long and tortuous route down.
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