As we have expected, prices hit resistance level on 30 Nov. As soon as the market opens on 3 Dec, prices did a pull back on the first two days. And it was buying opportunity, because long the prices didn’t break S&P 1385. And it rallied in the next 3 days to a higher high, on its way to the next resistance. What do you think the market will do next week?
EMA has crossed on both Dow and S&P. Prices are near the resistance level again. RSI is still holding above the red line (as shown on the RSI reading). So long the RSI reading is above the red line, there are two possibilities, either it range or continue its up run. Right now, I would choose to believe it will continue its up run until the chart says otherwise.
The prices on the daily outlook is in its overbought zone (base on RSI). And it is near the top of its channel, and its previous high. I believe that should act as a resistance level.
VIX (the fear index) did bounced off its low and rallied right up to $17.5. Now, it is in no man’s man. Not too high, nor low.
Summary:
Mid term view:
Base on EMA, the market has turn up. Beware of bear trap – bear rally instead of a bull run.
Short term view:
Prices are in overbought zone and its previous high. Pull backs might happen again. Any pull backs would be buying opportunity (but have your stop ready in case of a bear trap).
VIX is in no man’s land. Which mean the market might run up higher next week to test its previous high. Or it will pull back slightly. Thus, I believe the best entry point would be only when a pull back happens.
NOTE: All information provided “as is” for informational purposes only, not intended for trading purposes or advice
