SPY

1 Apr 2023

down trend channel is a Bull flag , most of the time the price visit the beginning of the channel before keep the previous trend which is Bear trend , i see few things that we need to be alert , may be creating a head and shoulders which is continuation pattern so it is a up direction , I thought head and shoulders was a down trend pattern , but reading Al brooks books he check over 30 years of chart and it is a continuation pattern , so , also in the blue dot line I draw the third touch will form a wedge top and double or triple top , wedge forming DT is a down direction , if fails it will try to close these 3 gaps left behind (marked with a red rectangle) . as Al brooks said earlier in the year, this year may be sideways.
remember 80% of breakout fails , so be aware of this breakouts , if you want to buy breakout make sure you wait for the continuation bar or a pullback on the breakout level .