NO CHANGE: I MAINTAIN THE CALL OF A SHORT-TERM PAUSE
This is madness but the fact of the matter is that despite extreme overbought readings bulls so far do not give in to an unavoidable short-term pause.
The occurrence of having from last Monday an impulsive up leg in progress (The only clear impulsive up leg of the advance from the April 18 low) is suggesting that price is on the verge of finishing off an EWP.
But due to yesterday's corrective looking intraday decline I remain suspicious that a top has been established. For this reason as long as yesterday's lod holds (1650.88) I have placed a big question mark at the top of the chart.
The three "major" warnings I discussed yesterday remain in force (Extremely low Equity Put/Call Ratio; TRIN approaching the 0.50 line and VIX with a potential reversal pattern taking shape)
Today I add a potential reversal candlestick of the beaten up TLT. (An oversold rebound should concur with an overbought pullback of equity)
But "despite it all" VIX failure to confirm a double bottom by moving above 13.53 besides a daily shooting star undermine the kick off of the overdue equity pullback:
Therefore despite yesterday's head start of the bulls could have completed a thrust following a Triangle wave (4) if bears today do not achieve follow through to the down side bulls are maintaining the upper hand.
- Doubtful outcome ====> Top is in place:
- If instead yesterday's lod holds, then even though price is challenging the low of gravity, we could have an Ending Diagonal in progress. Probably the delay of the inevitable top is due to OPEX manoeuvrings
Conclusion: It looks like that today, by eod, we should have a better clue of when the next directional move to the down side will kick off, in the mean time I raise the target box for the expected pullback in the range of the 20 dma and the previous resistance now transformed into a huge support at 1597.
Lastly we have the weekly candlestick above the upper Bollinger Band this is another rare extreme. If this week we finally have a buying exhaustion and a top is established I want to see an eow print below 1647.