Indeks S&P 500

We're Likely to Come Out this Zone Extremely Strong.

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Inside the general zone I have marked in here is where the 4.23 / spike out range of the 2008 drop was.

The 4.23 is a massive inflection level and when we get to a 4.23 three are usually one of two things that happen. The trend either drops by usually more than 50% - or the trend goes onto double in a manner far faster than the previous occasions.

It's difficult to put an exact price or condition on when this zone has failed because stop hunts suck - but if we keep uptrending above local resistance levels then it's wise to begin to consider the failure or the resistance zone may be happening.

I really want to enthesis the historic importance of 4.23s. At them we're usually seen major bubbles end (1929 was a 4.23 top) or uptrends turn into exceptional bubbles (Nasdaq broke a 4.23 in 1996 and went ultra parabolic).

Truly exceptional conditions are likely to happen upon the resolution of this 4.23 zone.

What happens here I think will set the trend for the coming couple of years.

And if it breaks, I think you'll see SPX doubling from the high price.

Based on all historical instances, if we break the resistances markets are liable to go vertical here. Really not a time to be stubborn with a bear bias.

Bear trades into resistance have a good case, but buying all the 76 dips until they fail is a total no brainer and would become insanely profitable if the breakout holds.

Even if we're going to make a top, you could typically make about 10% based on 1% risk per trade 1:3 RR on longs if local lower highs hold.

To my bearish friends, be very careful. If the break comes, it's likely we'll only get stronger and stronger.

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