I’m playing in a golf tournament this weekend so this week’s note will be brief. I just wanted to put together a quick technical update because we are at a very interesting juncture for the the S&P 500 right now.
A quick look at the hourly chart shows that after the significant decline we saw last Thursday in response to the Fed’s “tapering” annouuncement we have now retraced 61.8% (key fibonacci number) of the selloff:
Finally, here’s a chart I put together just for fun. It shows a simple 13-year cycle. Curiously it just happens to coincide very closely with the 1987 top and the 2000 top. It was a bit early for the 2007 top but lines up well with the top we saw in May. Make of it what you will.
It’s important to remember that technicals are only one piece of the puzzle and it pays to see the market in a more holistic way. That doesn’t change the fact that the charts are sending a pretty clear message right now.
See my full public chart list at StockCharts.com