Stop loss: 2160
Risk: 15 points
Reward: 25 points
on the monthly almost again (actually it happened already, the lags some months - several monthly bars - behind on the monthly chart):
Great, they pulled off the 'momentum kiss of death trap' yet again. Right on the day where the trend would have started to break out higher the S&P 500 ran into heavy distribution and then the index quickly fell lower in a move which I would describe as deep stall.
To show you one piece of what got me so bullish, here is a custom MACD histogram which was right on the verge of flipping back to bull, when bears finally decided to release the kraken:
I only saw this move coming on the weekly, but I ignored that ...
Quote: "In other words, buying the new highs in the S&P 500 today means you believe “this time is different.” It could turn out that way but history shows that sort of thinking to be very dangerous to your financial wellbeing."
My take: But this "time is (actually) different". This time both the US and EU (and Japanese) stock markets are distorted without any previous historic precedent by very very low interest rates and other tricks. The market makers in this game are the central banks. As long as Yellen and Draghi and Carney keep on pumping, I remain optimistic that the worst of the worst is over for this year until the US election has announced a winner.
"The PowerShares QQQ Trust (QQQ) saw the largest weekly capital inflows in 2016. Plus, QQQ outperformed its large US equity index ETF counterparts (SPY)(DIA)(IWM) on a weekly and monthly basis for the first time in 2016" ... "The rise of actively selective investors may be the next turnaround story of 2016! A reversal in return and fund flows among the big four US equity index ETFs (QQQ)(SPY)(DIA)(IWM) provides a powerful example. Turning our attention to fund flows, we saw that inflows into QQQ had historical significance, adding a second layer to QQQ’s reversal story."
Source: ETF Flows' Next Turnaround Story of 2016!
"Investors poured ~$1.2 billion into the largest technology ETF by assets under management (QQQ). Putting this number into perspective, note that last week’s flows were the largest weekly inflows into QQQ in 2016! The same is true on a monthly basis. In July, investors allocated the most capital to QQQ since the beginning of the year. Considering that QQQ closed at a year-to-date high, you should note that investors didn’t see the turnaround as an opportunity to offload some of their holdings. Instead, they had the confidence to add significant exposure."