To The Moon

Battle of the trend line!

The markets $DJIA(.DJI)$ , $NASDAQ(.IXIC)$ and $S&P 500(.SPX)$ made a huge statement yesterday to push the bears right into the 200moving averages and downtrend line. The FOMC president helped a lot by giving the market what they wanted to hear. The more pertinent question is 'Is this it? Is this the moment the bulls have been waiting for?' The bulls arguably have the upper hand and momentum. But the bears are going to hold on tight and give thebulls a hard fight. They are not going to let gotheir position so easily. It is indeed an intriguing match up and not very easy to guess the outcome!

Before we get ahead of ourselves, we have to remember that the downtrend line is still muchintact and in the bears' posession. The bulls have yet to break it and they are now looking like extending their wave 1. In fact, if the bulls continue pushing onwards to the 4300 levels, I might even need to revert to an alternative count which sees this as a C wave. However if the 4160 levels are not breached in this what I call a 'FOMO rally' encouraged by Powell, I see a retreat aka the wave 2 coming soon before the wave 3 rally.

So despite the encouraging rally on Wednesday, I am still cautious in view of the technical structure. I believe a better buying opportunity is coming up and is waiting for that to load up.

Stay safe 😊