The S&P 100 Index is looking vulnerable, according to Walter Zimmermann, Senior Technical Analyst at United-ICAP, who points to the presence of an ominous bearish rising wedge.
Since the mid-October 2014 lows, Walter Zimmermann, Senior Technical Analyst at United-ICAP, has given the benefit of the doubt to the upside for the S&P 100. However the Index has rolled out an extremely ominous bearish rising wedge from that October low and Friday (27 March) closed right on the wedge support line. Zimmerman’s advice is to avoid the long side of a market that breaks below a bearish rising wedge support line. The index, he says, has not looked this vulnerable since October 2007 (see chart 1).
Zimmerman says a decisive break below the 883.00 level will break the back of the Elliott Wave case for a continuing uptrend. Even if 883.00 holds and the market rebounds, he thinks that price action since mid-October 2014 suggests that only one marginally higher high may be left for the bulls from here (see chart 2).