Well. today we got very close to an All-Time High with SPY (the SP 500 Index ETF).
The first graph below is a graph of the last few months with daily bars; and you can see that the SPY hit its All-Time High today, but bounced back a little (like hitting a Brick Wall).
However, the second graph with minute-by-minute bars today (9/12/19) is more telling in that it shows that the SPY hit or came very close to the All-TIme High four times, but bounced back on each and ended down.
This is a true representation of what "Resistance" means. Many believe that when a market approaches its All Times Highs from below there are millions of investors (not necessarily traders) that lived through the existing All-Time High when it happened and are very sore that they did not sell back then. Many of these swore to themselves that if or when the market hits that All-Time High again, they are going to sell. For sure, it is highly possible that there are millions more sellers than there are buyers at many All-Time High levels.
On the other hand, in up markets with strong fundamentals (high earnings, low unemployment, etc) there could be millions of buyers waiting for confirmation that the market is still an "up market". Nothing proves this more than the market breaking its All-Time High on the up side.
So, sit back and do what MIPS tells you to do (all MIPS models are Long now).
- the muted black background space on the right is "after hours"
Paul Distefano, PhD
CEO / Founder
MIPS Timing Systems, LLC