S&P may be on its way for a love kiss

I talked about the suicidal kiss for S&P a few weeks ago and predicted S&P would have huge challenges to overcome its 50 DMA without retesting its Feb low first. S&P indeed followed my scripts twice (see here and here) although it almost tricked me with two times of fake breakouts. Eventually it seems the market god just wanted to prove I was right☺☺ by completing the suicides. We are now seeing the 3^rd time in a roll that S&P is going to challenge its 50 DMA (around 2687ish and moving) very soon if not tomorrow. We are talking about just a few points away at today’s closing. The million dollar question is whether S&P is again making another suicide kiss? I think this time, it is probably making a love kiss and move on!

If you have read my blogs for the past two weeks, you should have already known why I’m thinking so. Against the herd common opinions which were overwhelmingly bearish two weeks ago, I was probably one of very few to call the potential completion of this round of correction since early Feb. As I said, I’m cautiously bullish now, expecting the overall trend of the market being upwards. Of course, let me be very clear that the 50 DMA is a very significant resistance to overcome for the market. I cannot say for sure that it will simply break it out to the upside with just one attempt. It may very well just pause or even drop a bit to satisfy those nervous herds betting for more downside for the market. But I think it won’t test the Feb low unless something drastically negative happen. Technically it can even drop towards 2600 but hold up above that level to be still in a positive uptrend. I think it may not go that far down if it backs off from its 50 DMA this time. To be more assured that the market has done the correction and on its way to fully recover, we need to see S&P not only successfully break out from the 50 DMA and importantly it can also hold well above this level for at least a few days supported by the bullish technical patterns. While I could be wrong and too early, I do see more bullish signs now than bearish ones!