Gold 1795,835
|
EURUSD 1,1744
|
DJIA 35289,50
|
OIL.WTI 67,365
|
DAX 15887,50
|
|---|
The S&P 500 made a new all-time high. And the traders who follow our newsletters have once again learned from a simple pattern, which we have looked at many times before. Now back to it and technical analysis, which supposedly does not work.
S&P 500
A few days ago the following was written in the newsletter. Quote:
“Today will be the important day. One, even a long red candle does not indicate anything. However, if today also ends in a decline, then we should probably expect the price to be at the SMA 50 (red line) again.”
From here on, everything went strictly according to the scenario (pattern) that has been implemented on this chart 5 times already. The second red candle led to an increase in panic, and the third led to the closing of traders’ positions on stops.
The price reached the SMA 50 level. It was expected that once again we would see 3 red candles followed by a move in the opposite direction to new highs.
However, this time the pattern scenario has also accelerated. It brings in too much easy money. Traders did not wait for the formation of 3 red candles in a row. And started buying back the S&P 500 intraday, exactly from the touch point with the moving average.
Additionally, the bears were taken out who continued to short inside the day on this rise. They hoped that the day would end with a red candle after all. And when it didn’t happen, in a panic, they closed their positions closer to the closing of the American trading session.
From here it is simple. The price went up and yesterday we saw a new historical high in the S&P 500 index.
What conclusions should we draw?
There is a very strong long-term trend in the market. And the longer it continues, the stronger it gets. The smart money only stands with the longs. And stupid money, located in weak hands, starts shorting this trend every time it corrects. And each time they lose money on a new rise.
10.00 IFO Economic Expectations Index for Germany for August
14.30 US Durable Goods Orders for July
Important Notes on This Publication:
The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice.