A quick view on the SPX500 future shows something interesting. It is not rock-solid analysis, but just something fishy that caught my eye and I want to share. Discussions are welcome.
In the last week, we can see two interesting phenomena: - Big downwards price moves happen with big volume, mostly day time activity(blue) - Big upwards price moves happen with small volume, mostly night time activity(orange) Of course there are examples in this graph where things make sense (green) or where we see downwards momentum with little volume and upwards momentum with higher volume. But still… I find it interesting.
It seems market is very willing to push this down, but overnight news/players pushing it, cause it to keep strength.
And look at that candle to 2980! No volume at all! It’s fake. Fake news eheh.
For me this is another signal how this is a bubble that is about to burst.
Do I dare to trade on this now, in size? No. Not without more confirmation.
Do I think this should go down? Hell yes.
Comment
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I can add to the analysis that the 'push' to 2980 on the early hours of 20th of May are also very limited in volume. So far, the trend just continues. Let's see with what kind of volume a selloff will go.
Note that I have not compared these volumes with real SPX volumes or other brokers/exchanges. It could be a false signal. Conclusions from others are welcome.
MARKET,...JUST,....WON'T,....GO,....DOWN!!! It's a tough time to be a bear, isn't it?
pptw
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@BuckiTrader, yes, tough it is... and generally we know what that means if things just don’t want to move down... we need patience, patience and patience
TheMarketDog2
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not shaky.. there is no strength in this... it's all speculation...
- 65% of the rally in march was short squeeze .. unintentional
- there is a inflow of millions of speculators due to this impressive recovery and stay at home orders. in France 6% of the population opened up a trading account during the stay at home order. much more in Jpn etc.
you can be sure that when the bubble explode they will be fast to freak out and remove all the money they put there.
- Some 68% of respondents to the Bank of America Global Research Fund Manager Survey for May called the current market surge a “bear market rally.” ( cnbc.com/2020/05/19/most-investors-dont-think-this-rally-is-for-real-according-to-widely-followed-wall-street-survey.html) ==> I see that as traders know it will go down, but they are maximizing their returns while the pain will come for the lambda investor...
-vaccine hopes are not so certain. it usually takes 10 years to launch a vaccine. even if we can hope for one within 1-2 years because it's a simple virus and we have already good knowledge ( weforum.org/agenda/2020/04/why-a-coronavirus-vaccine-takes-over-a-year-to-produce-and-why-that-is-incredibly-fast/) for me this is all very thin to support companies cash flow in the medium term.
Mid-feb I told my dad we were in a bubble - because we were - and i didn't understand how stocks could go up so much while the virus was spreading but I was FOMO and greedy... bam -40%
pptw
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@guibl, thank you for the arguments. It makes a lot of sense. My only fear is all this behaviour might push it over an edge of no return which will lengthen this ‘game’. Only time will tell.
TheMarketDog2
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@pptw, NP... yes my concern is when governments start buying ETFs under the leadership of Blackrock. If it doesn't go through. It will damage trust for a very long time, at this point I don't even think we should worry for our money.
PS: I am far from being a conspirationist... but I like fair games
@guibl, There are few articles about that the virus is mutating too so it will be like the seasonal flu that changes every year. The vaccine only will work against some strains. There are few studies pointing at long term damage by the virus. Heart attacks and strokes went up.
I am not a doomer we will beat this and the markets will go up again but we haven't seen the real bottom.
pptw
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@Ringding58, yes I’m very interested to see how things develop when societies open up, lose the control of social distancing and when winter seasonal effects might cause a rice. Technical correction plus fundamental fear that this long from over (WHO functional states it could last 4-5 years) could make this a pretty violent downward move later this year. But, so far we are not anywhere close to that point.
Ringding58
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@pptw, As it is for now even when governments open up people not going out that much. So there is that but it seems all priced in and the market is happy with the 0% interest rate. On the long run there will be drop again. Even china has again a region under lockdown and there control their people quite well.
mvb317
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Totally right about candle to 2980. Looks like it was bought up just to sell down.