It has become almost comical over the past few years, and especially in 2013, just how many seemingly slam-dunk bearish patterns on various timeframes have not only failed to confirm, but would then fail and lead to sharp, V-shaped rallies to new highs. Such is life in a bull market, though, and before it is all said and done you usually see stubborn bears without much discipline rendered insolvent. That said, I am still going to chart what I see on this blog, give objective analysis and prepare for a variety of scenarios.
With this in mind, updating the small cap ETF on the 30-minute timeframe, I would be remiss not to at least point out the head and shoulders top which is the bears’ favorite pattern du jour on many indices on this timeframe. Given today’s intraday bounce, however, you can be sure this pattern is starting to scare bears into being yet another trap before we bust higher. So they had better not let go of this one so easily. I view that declining 50-period moving average (darker blue line) as being a battleground level.
Also, it is nice to see SWK hold its major breakout level post-earnings, today. I discussed the stock and its long-term setup in this post last week.
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