"Head and Shoulder pattern FAILED"
Glad to see so many saying that.
That's good for the bears.In fact a right shoulder can come very close to testing the high of the head and still be insde a H&S formation.And the formation that's been developing for over two months now is not a simple H&S formation but rather a complex formation with two left and two right shoulders.
Regardles,we'll get another test of this formation.The 60 min stochs on the indexes are waaayyy overbought.S&P will at least retrace to 928 minor support and probably 910 - major support.
But if it breaks below 910 that would be a serious technical failure given the bullish expectations.875 would be almost assured.And the next time we test 875 - look out below.
Meanwhile Dick Bove - the grandaddy of this bank rally - said on CNBC bank earnings this week will be ugly.He said GS is the only one really making money.He even said JPM is a loser.
The market is trading in a very fragile "box" - S&P 875-956.
If bank earnings bring in the gloom and doom,particularly when we're so close to the highs - the fragile box will breakdown - 875 will get taken out - and the correction will be on.
It could all happen very quickly..........
Let me add to this as I am not a "technical" per se.
I watch selling pressures of stocks like FAZ and BGZ on up future days like today. You're not seeing any real "fear" or rushing for the exits (in volume and price) from these short positions like one sometimes does. When I see this 9I'm going to hold my short mentality) it usually ends up with the market being down over the next 2-10 days. There is strength and conviction today in the "short".