The recent conclusion of the Federal Reserve's balance sheet reduction has made the current market environment quite interesting—there are indeed similarities to the period from 2019 to 2020.

Let's review: After experiencing volatility contraction in 2020, the S&P 500 formed a perfect M-top pattern, which was followed by a black swan event that caused a rapid decline. Subsequently, the US launched large-scale QE to stabilize the market.

The current situation is somewhat intriguing. The movement of the S&P 500 is almost a copy of 2020, with the M-top position nearly overlapping. There is a key support level at 6521. Once this neckline is broken, it is very likely that the scenario will repeat itself according to the 2020 script. Conversely, if new highs continue to be made, attention should be paid to the volatility around the 7535 level.

However, to smoothly initiate a QE cycle, the market needs a trigger. Sometimes this trigger comes from unexpected events, and other times it may evolve from general market pressures. At this stage, we are just waiting to see what form this trigger will take.