I was saying yesterday morning that there would most likely be a bounce before any test of the 1325 SPX support level, and we saw that yesterday afternoon. So far that bounce looks like a bear flag, and if we see more upside today I have a target in the strong resistance area 1357-63, with the gap fill from yesterday morning at 1362.66 SPX of course. The middle bollinger band held on a closing basis, and if we see a close below 1350, and a break of rising support from the June low on the daily chart then the next obvious support and target are the lower bollinger band and the 200 DMA in the 1315 area:
A reader yesterday suggested that my huge H&S on EURUSD was a bit of a stretch and well, beauty is in the eye of the beholder I guess. H&S patterns are often unpleasing to the eye however and this is a good time to review the last ugly H&S on EURUSD which broke down late last year. Again it isn't particularly pretty, but it has behaved perfectly as an H&S so far and it's worth mentioning at this stage because the target I gave at the time was the 1.12 area. That target is still very much in play though obviously the larger pattern is suggesting a move much lower. You often see a smaller H&S pattern at the top of the right shoulder of a larger pattern so these should be considered in combination:
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