Buyers Holding Off Sellers

Buyers are holding off the sellers in this bullish pullback. The SPY printed another lower low yesterday, and then the buyers stepped over the sellers closing well above the low. The price action of the SPY is flirting with-testing the 50-SMA and the $258.60 support area, what I would call a bullish pullback. Here is why I think the bullish pullback is good for the overall market, let’s look at the past five candles. The past five candles are drawing what could be a bullish continuation pattern, of course, it is based on the buyers holding support. If the bullish continuation pattern pans out the next target area would be about $270.50. And if the sellers walk all over the buyers $255.65 and $251.40 will be in the cards.

Notice how price action is trending above the T-Line and the Red/Green Dot trend in the chart below, we will remain cautiously bullish until we see a compelling bearish candlestick pattern with follow-through the breaks the bullish trend.

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