In our July update on NYA, I drew a target at the white .886 Fib line — also the bottom of a channel (red, below) connecting the two previous lows — and pronounced it do or die time for the index.

As it turns out, NYA had no trouble reaching that target.  It also had no trouble reaching the 1.272 extension down at 9513.  So, bottom line, it “died.”

Is it beyond resurrection?  And, what does it tell us about the broader markets and whether the downside is over?

continued for members…

Even though the 1.272 wasn’t motivated by a corresponding reversal up above (a reversal at the .786 would have signaled a Butterfly Pattern), NYA did reach the bottom of the rising white channel — meaning potential support.

Since reaching 9513, however, it has had a very tough time climbing back above the bottom of the broken red channel.  Today, it tested it but was soundly rebuffed.

If it can’t climb back into the red channel, it’s easy to imagine it bumping along inside the triangle formed by the bottoms of both the red and white channels.

Should the white channel bottom fail to hold, things get really ugly really fast.