The S&P 500 is retracing to test its new support level at 2950. Bearish divergence on Twiggs Money Flow warns of (secondary) selling pressure. Breach of support would warn of a correction to test primary support at 2750.
Sector indexes are approaching a watershed moment, with Autos rallying to test their descending trendline.
Retail is also headed for a test of its rising trendline after making a new high.
Even Semiconductors have recovered to test their 2018 high at 1450.
I still believe it’s a good time to be cautious.
“Be fearful when others are greedy and greedy only when others are fearful.”
~ Warren Buffett
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.