It looks like the 1810-1830 support band for the S&P 500 has been tested successfully again.
That's the 5th time since April 2014, which reinforces it as support. The Bears have to decisively pierce this 1800-ish support level to have their views vindicated. The onus is on them.
Granted the Bulls have a lot of resistance levels above too (More on this in future posts), but don't let yourself be scared out of your long-term investments by the voices of doom. They're always loudest near significant bottoms.
To add meat to my analysis, I'll make a probabilistic prediction (which should be the only kind of prediction when it comes to markets, as they are dynamic and chaotic): I give the S&P 500 a 65% chance of rebounding from here.
I will of course update this as more data becomes available.
Make sure to do your own due diligence before trading in these treacherous times.
Don't forget that Technical Analysis is a great descriptive tool of the markets but NOT a great predictive tool in the deterministic sense. What it allows you to do in the predictive realm is assign probablities to various scenarios. Markets are never 100% predictable.
But if a technique allows you to give a given scenario a 70% chance of happening (for example), I say it's a pretty useful one.
Don't forget that Technical Analysis is a great descriptive tool of the markets but NOT a great predictive tool in the deterministic sense. What it allows you to do in the predictive realm is assign probablities to various scenarios. Markets are never 100% predictable.
But if a technique allows you to give a given scenario a 70% chance of happening (for example), I say it's a pretty useful one.
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