He said flag formations are essentially just a pause as the market catches its breath.
“Consequently, at any point equities could break down and reassert the medium-term downtrend which started on May 2,” the analyst wrote. “Confirmation of downtrend reassertion would come on a break of 1140.13. Should that happen a violation of the August lows would be next in line.”
The iShares S&P 500 (NYSEArca: IVV) was down 2.6% in afternoon trading Friday. The S&P 500 session low was about 1,151.
