$SPX, daily
Three Bull Traps. Prior two led to substantial 'corrections'. Will the March'21 Bull Trap have the same consequences?
3700 is the key pivot. SPX is still above this level, however, if it drops below 3700 in the next several sessions, this will be a major red flag. pic.twitter.com/zp5WURNTFS
— Yuriy Matso (@yuriymatso) March 25, 2021
Today’s Chart of the Day was shared on Twitter by Yuriy Matso (@yuriymatso). It’s a daily candlestick chart of the S&P 500 over the past three years. Yuriy points out that the S&P 500 has formed a potential Bull Trap or Failed Breakout as it’s also referred to. This occurs when price breaks out but fails to hold above that breakout level, often leading to a sharp move in the opposite direction. As you can see, the last two major declines started with Failed Breakouts. The good news is that price has not confirmed this bearish pattern yet, so it’s still too early to act on. However, if price closes below 3700 in the near-term, watch out below!