The financial world seems to be wondering what is going to happen to the markets once the quantitative easing part 2 comes to an end next month.  Will we continue to head down the same financial path as Japan who is now into its QE5?

Historically, the stock market has actually risen when the Fed begins its initial round of interest rate hikes.  It is not until the market sees the interest rates as being too high that we begin to see stocks die.

The stock of Goldman Sachs may give us some clues as to what might be in store for the overall market.  The stock has taken a beating since January and thus far, the buyers have not stepped up to buy this oversold market barometer.  The stock is coming into what should be a major support area.  The $130 area has been support in GS for the last 2 years during the May – July season.  Each time, buyers have stepped up and supported the stock on its way to higher prices.

We are currently coming into this latest seasonal $130 support area.  Whether the stock breaks down from here or bounces may give us clues as to the future of the overall equity markets.

Chart analysis courtesy of the MTPredictor Elliott wave and Fibonacci trading software for stocks. commodities, futures and forex.

*click on the image here and again on the next page to enlarge*

Breakdown or Bounce?

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Tags: commodities, elliott wave, elliott wave program, elliott wave software, fibonacci, fibonacci trading software, forex, futures, goldman sachs, gs, mtpredictor, QE2, quantitiative easing, stocks, trading software

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