I’ve been watching and annotating the chart above for months. The first head and shoulders pattern that began with the new year and broke down midsummer (mirrored in the S&P 500) gave me pause and forced me to turn more conservative in terms of equity exposure.
Now, however, the chart is suggesting that a bottom may be forming in nearly identical fashion. A new head and shoulders pattern can be seen forming recently only this time it’s inverted. This should give hope to equity bulls for if (big “IF”) the pattern is validated (breaks above 780ish) a strong move to new highs should be coming.
And after a year of treacherous trading that would be a very beautiful thing.