Meat grinder. That’s what it feels like.
Every market move starts first in the 60min time frame. Once a move is established in the 60min time frame, then it will soon be reflected in the daily time frame, etc. The daily charts are all in sell/avoid mode now so it’s the 60min charts that will help in spotting the start of the next move, whether that is up or down. For the moment, the 60min charts are not offering up very many clues but even so they provide the best view of the market right now. The 60min charts are my “go to” charts and I’ll continue to focus primarily on them until the daily charts take the baton.
Chart of SPY showing it failed to break above the falling trend line that has been exerting authority lately. Unless the market should fall off a cliff tomorrow, then time alone will push SPY through the falling trend line.
The other part of the story is the new but very weak rising trend line visible in the 60min time frame. Over and over again in the last several weeks, we’ve seen these rising trend lines morph into Bear Flags with failures and I just have to think that the current rising trend line will do the same. I just don’t know when. The only thing that would convince me otherwise would be a break and close above the intra-day high of 141.16 from Tuesday, May 1st. In order to climb back up there, we would need a dynamic market and right now we’ve got a meat grinder. One of these is not like the other.
IWM, Q’s, DIA all look about the same as each is perched precariously above their respective rising trend lines in the 60min time frame. If this trend line fails to hold tomorrow or any other day in the future, then you just have to expect the indexes will drop below Wednesday’s lows and then search for another lower level where they will consolidate for a few days before they do the same thing again. Wash, rinse, repeat.
On February 16th, $SPX closed at 1358.04. At the time, this was the highest closing level for the year to date, if you catch my drift.