Always consider hidden risks
SPY Technicals:  My Dear Pennant Pattern ?
 September 14  ​( From Stockcharts, TradingView  )
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The Situation

We just start to realize how deep and violent the correction was on the ​​
​US ​equity ​market lately. From the peak price on SPY ETF reached on
​May 20 2015 at 213.78 ​to ​the low made on August 24 at 182.40, for a
​move of 14.68%.

That was the first serious real correction since October 2014...​

​​In fact, when we broke a Rising Wedge Pattern on August 20 2015
at 205.94​, ​game was over on SPY on a short term basis and then
​reached then the panic selling level on August 24 at 182.40.
​( See Chart Below - Blue Trendlines )

​​Rebounding from those abyssmal technical levels was quite a statement from Mr Market. But in reality, it started a Technical Continuation Pattern called a Pennant.

Why so:
1) That was preceded by a Sharp Price move ( in our case on the downside ) that was done on Heavy Volume
2) ​​They form with lower highs and higher lows and makes then converging Trendlines
( See Chart Below - Grey Trendlines )​
3) Volume normally expands at the start of the flag or pennant, contracts as the pattern develops and then expands on the breakout. ​( See Chart Below - Bottom Blue Area Line )​

​​​​So we must carefully follow those trendlines that when triggered, will tell us on which side the Break Out will
be. Til then, we will stay in a ping pong game that can make many casualties among traders.
( See Second Chart Below - Ellipse )​

​​Interesting to read:
Dennis Gartman’s ‘Pennant’ Is a Red Flag for the Bulls



SPY Technicals: My Dear Pennant Pattern ?   $SPY    #Trading #Emini #investing  #SP500
SPY ETF ( Daily Candles )
Volume ( Bottom Panel  - Blue Area )​​
SPY ETF ( Daily Candles )
Volume ( Bottom Panel - Blue Area )​​