The Dow, S&P 500, and NASDAQ Composite, have dropped down this morning to areas of support on their weekly charts. These areas are delineated by uptrend lines drawn off the August 2017 low and the lows of February and April this year. The NAZ is currently in the process of testing its trend line.
Unfortunately, the Russell 2000 Index took out its weekly uptrend line last week and is currently trading below last week’s low.
We speculated yesterday that the first phases of a morningstar pattern could be forming on the weekly charts. That scenario is not completely invalidated. If this mornings lows hold and the indices are able to build on that success into the end of the week, the movement would form rudimentary morningstar patterns. But that is projecting too far out into the future.
Right now the markets have to continue to moderate in these early hours of the session and stay quiet into the close. At this point that is what investors should do, too.