Is it the right time to go long in the US market?

Hi everyone. Welcome to this video. Today the topic is the US market. Why? Because we are really close to an important resistance level. So it's really important to understand this concept and to decide what we are going to do next. So here we are looking at the spy chart. That is the ETF tracking the S&P 500, the main index in the US market. And as you can see the price closes up around 280 level. That is a strong resistance. Why? If we look at this level we can clearly draw this line. Okay, I know in a previous video I seen that resistance and support are not lines but rather zones. In that case though, it's quite clear to see that the 280 is a good level of resistance. What else? Well, this is a strong resistance because it has been tested five times and we say when it's more than three, at least three, then it's already a good resistance. What about here? Well here we have seen that after this big drop there was a situation where the price started to go up. Let's see if we can identify some trend line. I think probably here we have one. Okay, again trend lines is. Well it's not something that you should force here at least is tested three, four times. So it's quite, quite good. And this is just a supporting evidence for the fact that the price is really going up with this kind of impulse retracement. Impulse retracement. That is usually what happens in an uptrend. Okay, so this is about the support and resistance with horizontal and trend lines. What about. Well, what about Fibonacci? Let's check with FIBONACCI if that 280 level is important. Well, if we take for example this level, that is the high we had before the market went down. And we connect this to the low of this first drop. We can see that this 280 level is also the 61.8 Fibonacci retracement level. And this means that the resistance we identified is even stronger. So it's really a value that we should watch out. Okay, now we can remove the Fibonacci to make the chart clear. Let's look now at the momentum indicators that I have introduced in a recent video. If you remember the momentum we are looking at R3. We have the parabolic stop and reversal. We have the force index and we have the MACD parabolic stop and reversal. As you see the yellow dot is above the price. This means bearish. So one is bearish. What about the force index? Well, the force index is above the reference line. So it's positive. It means that force index is giving us a bullish signal. And what about the macd? Well, the MACD is just recently turned bearish. You see now it's minus 0.05. So when this is negative, or in other words when the histogram is red, as you can see here, you see it's red. This means that from the MACD point of view we are in a bearish situation. So again, out of three momentum indicators one is bullish, the fourth index, one is bearish and the other one is also slightly bearish. So overall I think it's a bearish signal. Lets look now at the moving averages that again I've introduced in a previous video and they are quite useful to identify the trend. Now moving averages are giving us a different picture. Why? First the 20 EMA exponential moving average is above the 40 EMA and this means short term bullish. Then we have the price above the 20 EMA, we have the price above the 200 moving average that is this red line and the 200 moving average is sloping up. This means that from the moving averages point of view the situation is really bullish. Now if you put everything together, what do we have? We have bullish situation indicated by the moving averages and is mainly because of this, what happened from here, the last of the year till now, this recovery. But we have bearish indicators and we also have a very strong resistance level. So what shall we do in this case? Well, nobody can predict what will happen. But from my point of view I want to wait, I want to see if the price can break out this level, if the price can do that. And usually when you have this kind of setup where you have a horizontal resistance level and then you have this kind of price making higher low. So this kind of triangle is usually there is a big movement either up or down. And especially when you start to see that the candles are becoming smaller and smaller. So I want to see a breakout with a big green candle like this or even this. That will give a signal for me that the market is clearly on an uptrend. We can start to look for long setup in the US market and this level that was a strong resistance is now a strong support. What if this doesn't happen? Because the price here can start again to go down. Right? And as you can see here, this candle here indicates a very uncertain situation. We have a very small body and a long week. It means that the price opened and closed around the same level. So it means that neither the bulls nor the bears are in control at this point. Now if the price starts to go down, is it the right time to short? Well, I don't think so. We should wait for some confirmation because remember that from the moving averages point of view, before saying that we are in a bear market, we need to see some kind of signals. For example, we want to see the price going below the 200 moving average, the red line and this must be sloping down. And we also want to see ideally the price going below the 20 EMA. So if this doesn't happen, I will not start to short because what can happen is that the price can go down, make a diploma, then go up again and maybe have a breakout later. So again what I will do here is wait for confirmation. If we see a big green candle opening and closing above this resistance level, good I think is a strong bullish indication. If we see the price dropping, I would wait until the price can clearly close below the 200 moving average sloping down and below the 20 EMA. And if the price drops, another level that I would watch is let me show you this kind of zone because that was a strong support below. So the price may drop, then find this support and then bounce back. Right? And you see this is this was tested three times and then is also currently around the 50 moving average. That is another strong support level. So if the price can also break below this, then probably we are in another very strong bearish scenario and we can add short setups. We can look for short setups with more confidence. What is the alternative? Well, what you can do before this kind of situation become clear is to look for setups not in the US market but rather in the etf. ETF market, meaning you can look for setups either long or short in ETFs that are not strongly correlated with the S and P and they are ETFs tracking so many things that you can probably find some very clear uptrend or downtrend signal that you can take with more confidence while you are waiting for the US market to tell us what is the direction because currently we still don't know. Okay, so that's all for today. That was the analysis that I wanted to share with you. If you like this video, please put a like subscribe to the channel and if you have any question you can write me a comment below or you can send me an email using my blog. The link is also below in the description. Thank you for watching and see you next time.