On April 18th, Monday of last week, we penned a snippet about the SPX traveling in an unresolved channel and the beginning of what could potentially become an inverted Head & Shoulders. As the week progressed the formation became clearer and now the SPX is pushing against the neckline of said pattern.
If this resolves in the bulls favor we would anticipate a measured move from the neck. (1,340 – 1,250 = 90 + 1,340 = 1,430)
Interestingly enough, the measured move of 1,430 corresponds to the nest resistance on the weekly chart. This would, in our humble opinion, change the market sentiment back to full fledge bullish.