The possible H&S I was looking at on Friday morning didn’t form and the move to retest the prior high has done some interesting technical damage to the bear case, so I wanted to have a look at that this morning.
The SPX hourly chart below shows the break over declining resistance from the all time high, which held perfectly at the December highs and established a high quality three touch resistance trendline.
On the bigger picture there is also a decent case that a falling wedge has formed from the all time high on SPX that could be a bull flag. That flag wedge would have underthrown bullishly at the October low and this might therefore be the start of a break up towards a possible retest of the all time high.
(more…)