Stocks Facing Resistance

21 Mei 2021

Stocks have returned to 4178, exactly the level to which we alerted you yesterday. This and 4188 will provide resistance and the S&P is likely to range for a bit in a sideways correction after last month's rally. The range appears to be bounded from above by the levels just mentioned, and from below by 4068. Watch for it to form a consolidation pattern like a bull wedge before attempting another breakout, which would take us back to 4214, or if we are feeling ambitious, to highs at 4245. The Kovach OBV is picking up strength, but we will see at open if this is enough to break current levels. If momentum does not come through at the open, or its paltry, we are highly likely to reject those upper levels and retrace to 4144 at least. This would make a great short trade.