Is the stock market about to rally again?
In this video we discuss the seasonality heatmap and we tend to see from the markets through November.
Watch the video to learn more…
Hi, and welcome to this Blueberry Markets video update with me, John Kibbler, head currency analyst.
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In this video, we’re going to take a look at the S&P 500, as the price has recently found a resistance level.
So I just want to take a look at this and have a look at the currency heat map, and just see what we could be seeing for the stock market.
I have a bit of a seasonal heat map here, and what we can see is –if I just grab the S&P 500 and just draw a box over it, and then grab sort of October and November through here–we can see that the S&P typically rallies through these months.
So looking at price at the moment, however, the market’s hit the sort of highs just here. The recent highs and has given us a little bit of rejection candle. But is the price going to move back towards this low? Or is it going to continue to rally to the upside?
Well, the seasonality heat map is suggesting that we’re actually going to see a continuation of a rally on the S&P. So what we could anticipate is a breakout.
If I go to the lower time frames, for instance, let’s go to the daily time frame. We can see that price is technically trending higher because we have this little move through here. So the market is making higher highs and higher lows. Potential for a higher load to come in soon.
So the market’s making those higher highs. I haven’t really fully tested the swing highs just through here. Looking at the seasonal heat map, it does suggest that we could see another rally.
Are we going to see price push back up into this area here?
What I’m going to do is just grab a resistance level, pop that through there. I’ll make that red for resistance. This 3578 area is going to be an area where we could see prices head towards.
If we go to the four-hour time frame, we have price just trending lower okay. It’s making lower lows and lower highs, but it’s come to a point where we’re at support. So we’re at support, and we’re starting to get this consolidation pattern now.
So we’ve got one or two things to watch if price breaks out of this consolidation pattern, pulls back, and then looks to go long, we could be in for a nice long opportunity here on the S&P.
If the price breaks a little bit lower, then our bias is going to be out the window, really.
We’re going to be looking for the potential for that market to push to the downside. However, the consolidation at support suggests that we could be seeing some indecision around this area. That we could be seeing the support being held, and the market moves to the upside.
If I actually just zoom out slightly, grab that box and just drag this box, left like so, like a bit neater here. We can see that the market found multiple support and resistance points through this area. Even recently, we’re seeing those moves just through there.
What’s also interesting to me is the fact that price has made a lower low. On the RSI, We’re seeing a higher low. So we’re getting some RSI divergence here on the four-hour time frame. This suggests to me that we’re at support, key support, we’ve got consolidation showing indecision, and we’ve got the RSI giving us a bit of a divergence play going on through here.
What I’ll be looking at here is if price can break through these highs as we’ve just discussed, come back and re-test, we could see another rally to the stock markets. Okay?
So keep an eye on your S&P 500. Keep an eye on your stock market. Have a little look at this consolidation pattern. If the price breaks out to the upside, we know what to do.
Thanks for watching. See you in the next one.
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