The sp500 continues to trend higher since the September 2010 low but I noticed today a somewhat interesting symmetry from this important low. The handle formation of the large cup and handle pattern on the sp500 has served as somewhat of a pivot point and possibly mid point of the two current rallies.
The first rally was from the September 1st 2010 low up to the handle formation on the 5th of November 2010. Then the handle continued to form and the sp500 launched out of the handle formation creating a new persistent really which we find ourselves in now.
The interesting fact is that currently the duration of the first rally from the September lows is 46 trading days. Currently we are 47 trading days into the second symmetrical leg up since the handle formation.
The yellow shaded area in the chart above represents the pivot point or the handle formation of the large cup and handle formation. Sometimes clear symmetry is seen in markets from important pivot points. Expecting perfect symmetry of course is unrealistic (for example, expecting the market to top out in exactly the same number of days as the first leg). But I have seen plenty of stocks and indices make clear somewhat equal measured moves based on important pivot points. So I would say the current setup is something to be aware of and a possible sign that ‘we are getting close’ to the eventual expected market correction.
The cup and handle formation is also coming close to its implied projected measurement. Then if we also consider the Nasdaq composite become at risk of a correction in the 2860 range (since it would be at the 2007 previous highs), it paints a combined picture of some type of market pausing point, or even a sharp correction.