“Are the US stock markets poised for a reversion price event in the near future? My research team and I believe $4400 on the S&P 500 may be a key psychological level that many traders are unaware of in the immediate term. Some very interesting Fibonacci and Gann dynamics are at play as we watch the excess rally phase continue to drive markets higher. Will the Q2:2021 earning season prompt a blow-off top setup or will the markets continue to rally higher? Continue reading to learn why we are cautious of the $4400 level on the S&P 500 and why you may want to prepare for a moderately big volatility event if our research is correct.
There are a number of key technical components to our research related to the $4400 target peak level for the S&P 500. First, the Fibonacci correlation to the rally phases that have taken place throughout the bullish price waves (1-3-5) since the 2009 bottom. We’ll get to that in a minute. Second, we believe our Gann cycle phase research and Fibonacci Price Amplitude Arc research suggests the current market rally is very over-extended to the upside. In other words, we believe this excessive upside price trending is likely to revert, quite strongly, at some point in the near future.”
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