Interesting chart

This is an update on the chart we first posted in our Outlook July 26

Markets have gone on to play around trend lines that converge into late September-early October.

Here is the current version for Nasdaq (click for larger image):

Notice how the current rally that started in late August is climbing up a very steep trendline that converges into the same point.
It is unlikely that stocks can go on rising so fast, because that would mean they have to continue to go up by 10% every two weeks now.

So I think we will see this market correct downwards any day now, and probably quite sharply as happened on each of the previous occasions. Initial support will be around 2200 or just below it. If that doesn’t hold, then a triple bottom becomes likely.

It will be interesting to see how this pattern plays out.

Danny