Fibonacci Data Supporting A New Wave Down In The S&P 500
Let's delve into the world of the bizarre while taking another look at the S&P chart I put up last week. The chart that showed a five wave rising wedge completing. Today, we bounced off of the upper trend line of the wedge and fell marginally. But, there was more selling hidden under a trendless market than showed in the major averages. Let's see if I can embarrass myself by stating that tomorrow I expect a bounce in the morning to take care of some unfinished business from today's open followed by a change in trend in the afternoon. Wednesday is a very key day to the future of the rally we've seen over the last month or so. Can the bulls drive the market higher?
Many traders believe there is a mysterious, if not self fulfilling, pattern of Fibonacci ratios and numbers at work in asset markets. So, let's take a look at the short term and how it relates to Fibonacci data. And why Fibonacci data supports a change in trend.
Cinco de Mayo is considered a major date by many traders because May is often a market turning point and May 5th is marked by the Fibonacci number of five in both month and day. This year is also marked by the Fibonacci number of 8. So, we have a date marked entirely by Fibonacci numbers of 05-05-08. In addition, the move off of the last bottom of the S&P has lasted 34 days. Another Fibonacci number. The S&P is at the 50% retracement or recovery level from the October high, an important Fibonacci resistance ratio. And, this week we hit a major Fibonacci time zone of 144. In addition, the time of this upward move will have lasted approximately 38% of the decline from October which is another very important Fibonacci ratio. Finally, we just completed a 5 wave count into a rising wedge. The operative point being the Fibonacci number 5.
Let's sit back and watch the mystery unfold.
Chart of the S&P 500 through Friday's close.
Update: I guess I should add the five wave pattern is comprised of 3 upward waves and 2 downward wave. Both Fibonacci numbers.
Many traders believe there is a mysterious, if not self fulfilling, pattern of Fibonacci ratios and numbers at work in asset markets. So, let's take a look at the short term and how it relates to Fibonacci data. And why Fibonacci data supports a change in trend.
Cinco de Mayo is considered a major date by many traders because May is often a market turning point and May 5th is marked by the Fibonacci number of five in both month and day. This year is also marked by the Fibonacci number of 8. So, we have a date marked entirely by Fibonacci numbers of 05-05-08. In addition, the move off of the last bottom of the S&P has lasted 34 days. Another Fibonacci number. The S&P is at the 50% retracement or recovery level from the October high, an important Fibonacci resistance ratio. And, this week we hit a major Fibonacci time zone of 144. In addition, the time of this upward move will have lasted approximately 38% of the decline from October which is another very important Fibonacci ratio. Finally, we just completed a 5 wave count into a rising wedge. The operative point being the Fibonacci number 5.
Let's sit back and watch the mystery unfold.
Chart of the S&P 500 through Friday's close.Update: I guess I should add the five wave pattern is comprised of 3 upward waves and 2 downward wave. Both Fibonacci numbers.
<< Home