After watching the bull market break all the rules for the last ten years, we know better than to think that even the most formidable-looking technical barrier will slow it down for more than a day or two. Indeed, seldom have we seen prices fall for three consecutive days — a rarity even in the good old days. (Old-timers may recall that the October 1987 crash, when many traders might have thought the world was ending, lasted but for two full days and a fraction of a third.) Still, it would be careless to ignore the double barrier which stopped the DJIA’s ascent on Friday: a Hidden Pivot resistance and a trendline that both trace back to the first quarter of 2019. Instead of getting all worked up about the prospect of a healthy correction to end the year, however, we’ll simply assume that bulls are capable of holding things steady for at least a few more days, come what may. Since everyone expects this, or perhaps a continuation of December’s wilding spree, we should be on our guard against a (very) contrarian surprise.
Little Room for Contrarians as Year Ends
Please do not ask trading questions!