Equity Monday : FOMC, the 5 Diamond Edition
After 3 diamonds, the Hindenburg ship refuses to let up, adding 2 more diamonds to make it this a 5 star edition. https://tradehaven.net/market/equity-wednesday-the-hindenburg-buy-omen/
The last time we had this was back in May-Jun 2013 where we witnessed a 9% drop from the peak from the very first Taper tantrum.
“In a finance-driven economy powered by leverage, even a positive economic shock like lower energy costs can turn into a crisis.” ~ Pedro da Costa, WSJ
Looking at the latest chart, we had the historic high on 4 Sep this year at 11108.39 and the NYSE never really matched another high despite the S&P 500 breaking new highs on 5 Dec.
The double top pattern is certainly pretty to behold, breaking through the Ichimoku cloud too.
The STI also has a nice double top in the weekly chart suggesting that gains will be limited.
Nothing has changed from last week except that we have some clarity from OPEC that they will only do something when oil prices touch $40. “something” refers to convening an emergency meeting. http://www.bloomberg.com/news/2014-12-14/u-a-e-says-opec-won-t-change-output-even-if-price-drops-to-40.html
In the meanwhile, Japanese elections have come and gone and what was lauded as a good outcome has been met with cynicism, resulting in a lower Nikkei for today.
Market expect that the FOMC would take cue from oil prices but I have an odd intuition that the FOMC will be giving oil prices some cue for the week, besides locking horns with the 5 “diamonds” of the Hindenburg.
Who shall win ?
The old rules say that all double tops and Hindenburg drops will be opportunities to buy ?