• 526 days Will The ECB Continue To Hike Rates?
  • 526 days Forbes: Aramco Remains Largest Company In The Middle East
  • 528 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 928 days Could Crypto Overtake Traditional Investment?
  • 933 days Americans Still Quitting Jobs At Record Pace
  • 934 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 938 days Is The Dollar Too Strong?
  • 938 days Big Tech Disappoints Investors on Earnings Calls
  • 939 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 940 days China Is Quietly Trying To Distance Itself From Russia
  • 941 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 945 days Crypto Investors Won Big In 2021
  • 945 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 946 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 948 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 948 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 952 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 953 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 953 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 955 days Are NFTs About To Take Over Gaming?
How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

  1. Home
  2. Markets
  3. Other

What's Next ... Will We Have a Rising or Falling Market?

The most important market test of the past two months is coming up soon as seen on today's chart.

Note how the market Strength has behaved on our C-RSI, 30 day indicator. It has been in a down trend since April, and it has been in Negative Territory since the end of July. That has translated into a DOWN condition for the market during the past few months.

Will this change soon?

What happens within the next few weeks to our C-RSI behavior will determine what happens next in the stock market.

This describes the BIG test coming up and what has to happen for the market to rally:

There are two important things to note on the C-RSI chart below. First, is that the C-RSI is both below a resistance line, AND below the horizontal zero level. For a hold-able upside market rally, the C-RSI needs to be above the resistance, and above the zero line in Positive Territory.

Second, the important thing to notice is that the black resistance line, and the red support line are forming a triangular formation that is fast approaching its apex area (see the circle).

Why is it important when an approaching apex's occurs?

Because the market gets squeezed, and squeezed harder as the resistance and support lines converge on each other. Just before the apex is reached, the tension becomes too much and the indicator and/or market index breaks out of the pattern ... and when it does, you get an important move in the market.

Which direction it breaks out determines which way the market breaks out. You can't know for sure which direction such a pattern will break out, but this one has a two month positive divergence bias that the C-RSI has been developing relative to the NYA Index's movement. That could easily cause the CRSI to break out above the resistance line, but the big hurdle will be for the C-RSI to move higher than that and then close above the zero line.

CRSI Chart

 

Back to homepage

Leave a comment

Leave a comment