US Markets close to a Major Breakout !

2 min read

The US markets, specifically the S&P 500 index, have undergone a remarkable rally from the end of October 2023 Starting at 4100, it has surged nearly 12%, reaching an impressive 4600. The steady ascent, reminiscent of a cup and handle pattern, has brought us to a July high, challenging levels not seen since March 2023.

A closer look at the historical data reveals a cup and handle pattern in the making, or alternatively, an inverted head and shoulders formation. Should the latter play out, signalling a move upwards, we could witness a substantial increase of almost 1000 points. This optimism persists despite prevalent recessionary discussions surrounding the US markets.

The “Baav Bhagwan che” or BBC principle comes to light here, emphasizing the importance of observing price action over narrative. The previous year’s recessionary predictions failed to materialize, highlighting the significance of focusing on market dynamics. As we approach 2024, similar predictions are met with skepticism, given the current strong market performance.

Market sentiment has proven resilient, with the chart displaying a bullish trajectory. Despite initial concerns during the COVID era, the market’s one-year correction and subsequent retest of recent highs signal a positive outlook. As we break above 4600, there’s anticipation that the US market may ignite a rally, potentially influencing global markets, including India.

The correlation between the US and Indian markets is emphasized, with confidence that a thriving US market could positively impact Indian markets. The lesson here is clear: actions speak louder than words. Amidst fluctuating predictions and narratives, the market’s upward momentum remains a strong indicator, urging investors to rely on observable data rather than speculative discussions.

In conclusion, the current bullish trend in the US markets challenges recessionary forecasts. The charts present a compelling case for continued optimism, emphasizing the need to prioritize market actions over speculative talks. As we navigate the intricate web of global markets, the lesson remains clear: trust what you see, not what you hear.

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February 29, 2024 by Weekend Investing

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    US Markets close to a Major Breakout !