This is worth taking a look at, to see a visual of the S&P on the weekly chart, and show just how similar in scale, slope, and pattern the market action of this rally off of the September lows is to the rally we saw from January through August of last year. Even more so, pay close attention to the last two candles before the dump in April ’10 and the last two candles of the present market and you’ll find the similarities are jaw-dropping. Now it doesn’t mean it is going to play out exactly the way it did last year, but instead, should be taken as a warning sign for the bulls, that adding new longer-term positions at the current price the market is offering them at, should be deemed risky, and the better route would be to hold off until those prices get a tad-bit cheaper.
Here is the S&P Weekly Chart.
