IMPORTANT NOTE: speculative setup. do your own
due dill. use STOP LOSS. don't overleverage.
Tagged as SHORT because short-term I expect
more losses / 40% correction possible.
🔸 Summary and potential trade setup
::: SPX D1 market overview/outlook
::: PRICE/RSI10 div on daily price chart
::: odds are stacked in BEARS favor right now
::: I see only limited upside from here
::: One of the longest bull markets in history
::: 460% gains off the cycle lows
::: upside likely limited from here
::: some major tail risks for the bull market
::: including riots/violence across US next few weeks
::: also new wave of lockdowns might be imposed in US
::: and this in turn may result in riots/violence
::: not many positive factors supporting further gains
::: aside from the stimulus package
::: problem with stimulus - it's already FULLY PRICED IN
::: by the traders. it's already a done deal.
::: Bulls need a new catalyst to restart the bull run
::: I don't see any viable catalysts aside from
::: mass roll outs of the vaccines
::: which are likely delayed untul Q2 2021
::: therefore odds are shifting in BEARS favor now
::: good luck traders!
🔸 Supply/Demand Zones
🔸 Other noteworthy technicals/fundies
::: TD9 /Combo update: N/A
::: Sentiment short-term: BEARS/CORRECTION
::: Sentiment outlook mid-term: BEARS/CORRECTION
One case for shorter term bear followed by short term or rest of year bull run would be market goes down fast and heavy like it did last year, although even faster. Big correction timed with worsening job numbers and then Wall Street is comfortable that fed money machine keeps going Brrr all year... they then run up market again while confident that they can rely on the “keep printing until jobs normalize” trope because I think they’re all in agreement on that, where as the “keep printing until 2.4% inflation” idea I believe is more controversial and likely to cause disconnect between politics and the Fed if jobs normalize.
Holding all my puts happily but if we get 15-20% down slowly over a month I’ll start to consider possibility of longer term trend change and will be repositioning for longer term plays.
If we get a big week with multiple circuit breakers and blast through the newer channel resistances Or megaphone and keep going down, my assumption will be market is trying to correct quickly to time a spring return to normalcy bull run.
Hoping for MMS to paint out the faster version as well get to go long and short this bad boy twice.