The solid rebound in US stocks overnight raised the chance that this month’s correction is already over. All three major indices, DOW, S&P 500 and NASDAQ closed above 55 day EMA. Focus for NASDAQ is now on 11245.41 resistance. Firm break there should confirm completion of the pull back from 12074.06 at 10519.59. Stronger rebound should be seen to retest 12074.06.
Nevertheless, in terms of time and depth, the whole corrective pattern shouldn’t be completed yet. Hence, we’re not expecting a firm break of 12074.06 with the next rise, if happens. Instead, there is prospect of at least one more fall to test 38.2% retracement of 6631.42 to 12074.06 at 9994.97, before completing the consolidation. But the good new is, the corrective pattern is eventually more likely a sideway pattern than a deep decline.
