Well - POMO got in action again Friday and we got a nice rally on Friday. Lots of people talking about the inverse HS pattern , but I dont believe in this one, also cause the volume on breakout is no biggie... I still believe we are about to make a major top here and we should get a nice crash or hard sell off soon. I'm still short and underwater, but for a swing play I can just hold , cause when we go down with volume it will be fast.
We are very very overbought and VIX on weekly too is very oversold setting up in a falling wedge so could go soon. We have a weekly bullish divergence in VIX and daily chart in a falling wedge, so if VIX will go down few more % before it will rally 10-20-30% ? we will see
Well we may go to test the 1170-1180 now if we take out 1150 SPX , thats the next resistance before the flash crash happended.
But overall too dangerous to go long here , I still believe this is the right shoulder forming in a big complex HS pattern and when we go down next time should take us to 942 imo.
We will probably touch again the downtrend from the highs 2007 and highs april 2010 and we will hit that trendline again, to confirm another move down. (You can see on charts we are at the big trendline now - SPX lagging a bit but reaching it soon.) It will be interesting to see how it plays out...I'm looking for a bear flag..
Thats also cause volume over last months is decreasing telling us this rally is weak and not bullish.
But all in all - still bearish and staying short, this rally is for fools and perma bulls going long and happy now.
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