Jumat, 26 Juni 2020

Technical Analysis Update: Stocks Fail to Fall

June 26, 2020

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Technical Analysis Update: Stocks Fail to Fall

Graham SummersDear Money & Crisis Reader,

The markets have moved a lot… without going anywhere.

Despite what seems like a very busy couple of weeks, the S&P 500 has effectively gone nowhere (red rectangle below).

stocks are stalling

Now, we’ve had two similar consolidation periods since the markets bottomed on March 23 (blue rectangles below). And both of them were resolved with stocks moving sharply higher.

stock tend to rise

Indeed, despite all the bearishness I see in the media, stocks continue to hold their bull market trendline (blue line) as well as support (green line).

A sure sign of bullishness

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You’d think that given the fears of another round of COVID-19, as well as the continued civil unrest, that stocks would have broken at least one of these. The fact that we HAVEN’T seen a breakdown is in fact very bullish.

Indeed, it’s a hallmark of bull markets that stocks DON’T fall on bad news. That’s certainly what we are seeing today.

This is why it’s so important to look at the actual charts of the market at least once a week.

Otherwise it’s easy to get caught up in the emotions of the day-to-day moves. But once you focus on what the market is actually doing instead of how it makes you feel, the picture becomes a lot clearer.

Best Regards,

Graham Summers

Graham Summers
Editor, Money & Crisis

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