Powerful Reversal in SP500 Candlestick Analysis says more Upside to Come

The sp500 did a significant reversal today and it at least opens the door to a break north of the 1116.50 level I was alluding to yesterday.  Simply candlestick analysis shows that we did a reversal hammer and there is also a slight tendency towards a small head and shoulders bottoming formation in the sp500.

The potential crash window I was talking about yesterday may be completely destroyed as of today.  Perhaps I am jumping to the conclusion too quickly, but if we were going to stay bearish we ought to have had a hard down close today.

On the other hand the weekly price chart on the SP500 shows a small rising wedge formation that has yet to be broken to the downside.  So it could be that the market just wants to bide its time and back and fill until a real decision is made.

If somehow the weekly MACD is able to turn upwards in a bullish cross then all bets may be off and this market could start hitting new highs again in a slow push forward.

It may seem absurd to switch so quickly from a potential crash window to a bullish breakout scenario, but that is just the way the market works.  We are at a significant ‘tipping point’ in the market right now and that means that the market can tip in a big way either up or down, but the hard part is figuring it out ahead of time.

If somehow the bears manage to control the market tomorrow to close the week out then maybe the big decline scenario would still have a chance, but at least as of today’s close this seems unlikely.

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