Blog Post: Market Analysis and S & P 500 Forecast by Brian
Hello to all! Today, we're going to discuss an interesting topic regarding a recent tweet from our very own Brian.
In this blog post, we'll look at Brian's interpretation of the market's behaviour and some predictions for the future. If you're trying to navigate the sometimes difficult world of investing and trading, this post is sure to provide some valuable insights.
The Tweet Analysis
Brian posted a tweet on the 26th of October regarding the current market situation and directed it towards a prediction he had made a month prior. In his earlier tweet from September, Brian had pointed out a scenario where the market would bounce back to the 440 area before going down to the year-to-date anchored VWAP along with the 200-day moving average.
"It didn't follow it perfectly. No one would really expect it to, but it did a pretty good job of saying we're in a downtrend."
Brian's insight into the market's movements is not solely based on numeric analysis but draws largely on market norms and patterns.
Recent Market Scenario
The prediction of a downwards trend was corroborated with the Head and Shoulders pattern in the S & P 500. This model painted a pattern moving from June through October, signifying a potential decline. Subtraction of the height of the Head and Shoulders pattern from the breakdown point at 436 signified a move down towards 411.
Interestingly, when the market actually dipped, it settled right at the 411 area. However, with a declining 20 and 50-day moving average, the market was sent dipping even further. But, with the head and shoulders pattern and the VWAPs in mind, Brian sees little potential for further depths, at least in the current run.
The Future Scenario
Based on the logical expectation of a market bounce, Brian has sketched a potential bullish scenario for the upcoming weeks.
Using the 30 minutes time frame, he aimed at a possible market bounce in the next few days. The 5-day moving average, which was in decline, is expected to finally flatten out and eventually rise.
If this scenario materializes, we might witness a switch to higher highs and higher lows, thus indicating a possible turnaround. However, bear in mind, this is not an assured scenario but a probable one based on existing market trends.
Though a bounce-back seems plausible, it doesn't necessarily mean that the market can't selloff any further. Should the scenario fail to materialize, Brian advises continuing the watch, each trade evolving in its merit but focusing on a potential turnaround.
"We just simply don't know. It's all evolving. And each trade, each leg of this, I would trade on its own merits, but within the context of a potential turnaround."
Remember, the best we can do is stay prepared. There's always a great wealth of information at Alpha Trends. Take a two-week trial if you haven't already, to see how it might benefit you.
That's all for this time! Until next time, happy trading!