The New York Stock Exchange is the largest of the U.S. markets and yet you hardly ever see anyone talk about it. I like to follow this index very closely. We can see the ascending wedge breakout at the start of 2013 when the Fed stepped in with QE 3 and completely took control of price discovery through various proxies. We now know that for a fact.
Now what we are looking at here on the NYSE weekly chart below is another rejection off the very strong resistance level. This is the third test of this resistance since the index peaked in mid 2014. A breakout to the downside of this wedge would be very telling indeed. On the other hand we cannot rule out a breakout to the upside. I find the later to be a very remote possibility at this stage with the prospect of a pending rate rise. We understand that the markets are hugely dependent on the zero interest rate environment. It would not take much at all to see a shake out. As I say, all we can do is watch the levels and trade accordingly. If the markets go on into September at these levels the outcome could be very dire indeed.
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