Going through current market conditions and the big picture
GOLD Failed to hold above ATH. Support turned into resistance. Below 50 DMA & Monthly P. More downside possible with 1935-1950 potential top. DXY Kinda the opposite of Gold, but bottomed much later. Right now seems to have reversed and trying to go up. COPPER Diagonal broke, it started trending down, but has now come back above the old highs. Very tricky situation. USOIL Still hasn't dumped as much I'd have expected. Still believe there is more downside (20-29) until I see a close above 44.
Russell 2000 closed above the August high, while SPX & NDX are still below. With US yields going up while Europe is stuck, value is getting stronger. Also IWM/NDX looks to have completed its cycle. Good at least for a dead cat bounce. I feel stupid for not going long while NDX retested the log diagonal that was resistance for many years. I still believe it could hit 9950-10200, however I am not gonna lie... It looks less likely. Big tech doesn't look great, but many smaller stocks look really really strong. My view was that bonds going down (yields up) would cause problems, but this might not be the case. At least it might hurt some of the risk parity guys who see both their big caps & bonds go down. The rest get to benefit from all the stimulus and yields going up.
EURUSD looks bearish to me. It could get up to 1.183-1.185 but not higher. USDTRY mega bullish. The TRY is toast. USDMXN bounced of key support more than I expected. Now not sure as I'd expect it to chop a bit. USDCNH clear downtrend. China looks strong and CNH even more alts seriously struggling and I believe their cycle is over. Of course there will be bounces, especially when BTC finally goes much higher. Every pause it will have until it gets to new ATHs will give them some breathing room. Some alts like THETA or newer coins might go up.
Today I had a discussion about alts and whether the trend is up or down. Based on everything I know about alts, every indicator, every metric and PA tools I have... Alts are in a downtrend. Even using the 2 LHs & 2 LLs 'rule' is enough. We've had 3 LHs & LLs. The BM% doesn't crash to 3% and stay low in alt season. Alts don't recover after a month of downside after being up 10x. Major alts like LINK shouldn't look like BTC in 2017-18. Anyways, my case is clear: learn about the cycles, follow the cycles.
BTC's volatility is going down vs the volatility of the SPX. I think that looking Bitcoin's volatility in isolation might not be as good as looking at it vs the volatility of stocks, especially as over the last few months they are more correlated than before. Bitcoin searches worldwide are really low. They are back at the December lows. With new blood not coming in, the time for a pump is close. If there is a dump, it will be the capitulation we need before moon. On-chain FA and several other data are pretty bullish.
My view is that volatility is coming. With regulators stepping in, with a highly contentious election, with Trump playing with the market non-stop talking about non giving the stimulus checks or not, with the VIX looking bullish and the DXY too... I'd be cautious and long Vol
Russell 2000 closed above the August high, while SPX & NDX are still below. With US yields going up while Europe is stuck, value is getting stronger. Also IWM/NDX looks to have completed its cycle. Good at least for a dead cat bounce. I feel stupid for not going long while NDX retested the log diagonal that was resistance for many years. I still believe it could hit 9950-10200, however I am not gonna lie... It looks less likely. Big tech doesn't look great, but many smaller stocks look really really strong. My view was that bonds going down (yields up) would cause problems, but this might not be the case. At least it might hurt some of the risk parity guys who see both their big caps & bonds go down. The rest get to benefit from all the stimulus and yields going up.
EURUSD looks bearish to me. It could get up to 1.183-1.185 but not higher. USDTRY mega bullish. The TRY is toast. USDMXN bounced of key support more than I expected. Now not sure as I'd expect it to chop a bit. USDCNH clear downtrend. China looks strong and CNH even more alts seriously struggling and I believe their cycle is over. Of course there will be bounces, especially when BTC finally goes much higher. Every pause it will have until it gets to new ATHs will give them some breathing room. Some alts like THETA or newer coins might go up.
Today I had a discussion about alts and whether the trend is up or down. Based on everything I know about alts, every indicator, every metric and PA tools I have... Alts are in a downtrend. Even using the 2 LHs & 2 LLs 'rule' is enough. We've had 3 LHs & LLs. The BM% doesn't crash to 3% and stay low in alt season. Alts don't recover after a month of downside after being up 10x. Major alts like LINK shouldn't look like BTC in 2017-18. Anyways, my case is clear: learn about the cycles, follow the cycles.
BTC's volatility is going down vs the volatility of the SPX. I think that looking Bitcoin's volatility in isolation might not be as good as looking at it vs the volatility of stocks, especially as over the last few months they are more correlated than before. Bitcoin searches worldwide are really low. They are back at the December lows. With new blood not coming in, the time for a pump is close. If there is a dump, it will be the capitulation we need before moon. On-chain FA and several other data are pretty bullish.
My view is that volatility is coming. With regulators stepping in, with a highly contentious election, with Trump playing with the market non-stop talking about non giving the stimulus checks or not, with the VIX looking bullish and the DXY too... I'd be cautious and long Vol
