The Power of the Pattern applied Fibonacci to the 2016 “weekly closing highs and lows” at each (1), then applied the 161% extension level to them.
SPY hit the 161% extension level around 6 weeks ago, at the 238 level and has proceeded to create a series of lower highs, while breaking a steep rising support line at (2). This line was created off the lows at the time of the election.
Since hitting this key resistance level, the S&P 500 has created a series of “bearish reversal patterns/bearish wicks,” three out of the past 6-weeks! See post discussing bearish wicks HERE
Until the S&P can take out the 161% level, it comes into play as the 800 pound resistance zone.
The SPDR S&P 500 ETF Trust (NYSE:SPY) fell $0.33 (-0.14%) in premarket trading Wednesday. Year-to-date, the largest ETF tied to the benchmark S&P 500 index has gained 4.97%.
This article is brought to you courtesy of Kimble Charting Solutions.