The Stock Market has expended a lot of energy in it's upwards climb since the election.
To assimilate this upwards price action, markets need to pause to re-energize and consolidate the recent price moves.
The trend has shifted to sideways which is essentially nothing more than a non-trending market state.
Whether the market breadth is for 30 stocks (the Dow), 500 stocks (the S&P 500 index) or the larger 2000 company group represented by the Russell 2000, we see the same action displayed: A consolidation or sideways trend is in process following our recent strong upswing in prices.
This, however, is not just a local market phenomena. By examining the Japanese Stock Index, we find the very same type of activity: a pause in upward momentum.
I've provided a few price points to watch in the Nikkei and the Dow in the charts to the left.
It would not be out of line at all for the markets to pull back like a spring and then launch upwards to new highs.
One needs to allow a certain amount of price movement (which is derived from some formulas I've learned over the last 45+ years of studying WD Gann's materials, clues & rediscoveries) in order not to panic when prices pull down from their present high points.
Locating critical price levels for highs and lows as well as highly probably turn dates are really some of the most sought-out tools that traders wish for.
Predictions can be made very accurately, but, one must first put away faulty assumptions and teachings. - George