In my previous post, I have narrowed down the number of possible chart patterns to two as shown below
I have also mentioned that
possibility 1 is more likely because the volumes traded were low. However as shown in the following charts, both the indices are approaching a resistance level, if Dow and S&P can break the respective resistance line with high volume in a convincing manner, then
possibility 2 is in place, the market will run with high volume to complete the wave (III).
For sign of possibility 2, look for price breakout and volume reversal. Failure which, the current run up is a sucker wave B, wait for the wave C pull back for fresh entry.
I have also mentioned that possibility 1 is more likely because the volumes traded were low. However as shown in the following charts, both the indices are approaching a resistance level, if Dow and S&P can break the respective resistance line with high volume in a convincing manner, then possibility 2 is in place, the market will run with high volume to complete the wave (III).
For sign of possibility 2, look for price breakout and volume reversal. Failure which, the current run up is a sucker wave B, wait for the wave C pull back for fresh entry.
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