S&P 500 is closing in on the retest of its 3-year rising wedge bottom. That will also be a retest of 196, the VWAP of the 4-month red megaphone on the chart.
Every attempt at a top on the way up from the low has broken out upwards. The latest try at a megaphone top is extending upwards without a real breakout.
There ought to be some kind of scuffle at the retest point, and Friday’s CPCI would usually give high odds to the bears there, with a target of roughly 1800. Also, the red megaphone would be legal for a breakout downwards to far past 1800.
But if SPY and ES break back into the 3-year rising wedge or through the red megaphone VWAP at SPY 196, it’s a fresh set-up to go long for a move to the red megaphone top and a new all-time high.
The play is to stay long unless and until we have an actual set-up to short.
Still, the entire wave up from the low has the look of an X wave short squeeze.
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