What is to Come after Stocks Stumble in the New Year
We warned you stocks would face resistance at highs and a retracement was likely. But we admit that we didn't anticipate the extent of the fallout here. The S&P blasted through the levels we have identified, at 3737 and 3714, and then a few more before finally finding support at 3665, a Fibonacci level. The Kovach OBV has registered this dip and verifies how serious the momentum was here. It is difficult to say whether we will continue to dump today or if stocks will retrace. We do seem to have bounced back already, but 3714 is now providing resistance. Watch for momentum at current levels toward the open for a hint of where the market is going. Ghostsquawk AI is risk on, but more toward the neutral side, so it could go either way. NOTE: on the daily chart there is a bearish butterfly cypher pattern. These tend to be pretty reliable so we could be in for another sell off and potentially a bear market soon.
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