The S&P 500 rallied off support at 1290/1300, the 50% Fibonacci retracement level. Respect of resistance at 1350/1360 would indicate a strong correction. Likewise a 21-day Twiggs Money Flow peak below zero would be a strong bear signal. The primary trend remains upward, with support a long way off at 1150.
On the weekly chart, the Nasdaq 100 displays a solid bounce off support at 2500 and the rising trendline. Respect of resistance at 2650 would indicate a test of 2400. A 63-day Twiggs Momentum trough above zero would reinforce the primary up-trend, but momentum is falling fast and penetration of the zero line would warn of reversal to a down-trend.
Colin Twiggs is a former investment banker with almost 40 years of experience in financial markets. He founded PVT Capital (AFSL number 546090), which provides income and growth strategies to wholesale clients.
Colin also co-founded Incredible Charts and writes the popular Patient Investor newsletter.
Using a top-down approach, Colin identifies macro trends in the global economy and then combines fundamental and technical analysis to evaluate opportunities in sectors that stand to benefit.
Focusing on interest rates and financial market liquidity as primary drivers of the economic cycle, he warned of the 2008/2009 and 2020 bear markets well ahead of actual events.
I agree with your analasys. I believe that the market will rally to test overhead resistance possibly even break thru resistance slightly, enough to encourage longs back in en mass but be aware, Wall St is a monster, I believe a head fake above overhead resistance will see a very large correction to the down side. Follow the smart money, remember Wall St accumulates as prices are coming down and distributes into strength, smart money indicators such as yours are what traders need to follow the smart money