SPDR S&P 500 (ARCA:SPY) is back inside its 3-year rising wedge (navy blue on chart). If you aren’t already long, this is a fresh set-up to get long even though there are all kinds of topping signs on the short-term charts and there’s a great chance you’ll get kicked out of the trade tomorrow.
If you just can’t deal with the FOMC madness, the target for this move, if it continues, would be the top of the wedge and top of the red 5-month megaphone on the chart. There would usually be a breakout through both formations at this point, with some kind of big topping pattern forming with a neckline at those tops.
When I say big, I mean a topping formation that could add 100-150+ points to the breakout (10-15+ on SPY) before the first retest of the top.
Then there should be a retrace to the SPY 196 level for a decision on whether SPY is really going to break out the top of both formations into a blow-off top. The bigger the topping pattern before that retrace, the more likely the market will go straight from there into a deeper correction, and the less likelihood of a move from 196 into a blow-off.