S&P500 EUPHORIA = SPUPHORIA
For those of us who have been trading a long time, S&P futures were called SPU's (sounds like SPOO) because the first contract was September and that means you use a letter U after the root code SP for S&P500.
What I find interesting is when signs of EUPHORIA shows up in the price action and this time there are two of them, back to back. There is a smaller, third wedge also. It is merely a price formation where stacking corrections take less time and have generally less price depth, so that the resultant mentality becomes "BUY THE DIPS" or "Hooray! Another dip to buy". When making money becomes this robotic, then likely something very different is about to happen.
What also happens is that "sell stop" orders can accumulate under previous correction lows and then a short, sharp correction ensues.
The longer term forecast I had published near the beginning of the year forecasted the market to move sideways to higher for the year, so this forecast is tempered by that longer term structure. Of course, any guess is just a guess and my ego is not involved in this analysis. I am only offering a vision into the setup that I see in place in the market and the path of least resistance that lies ahead for the stock market. I hope we can adjust our positions to profit from this pattern setup.
All the best,
Tim
1:57PM EST Wednesday, June 5, 2013
For those of us who have been trading a long time, S&P futures were called SPU's (sounds like SPOO) because the first contract was September and that means you use a letter U after the root code SP for S&P500.
What I find interesting is when signs of EUPHORIA shows up in the price action and this time there are two of them, back to back. There is a smaller, third wedge also. It is merely a price formation where stacking corrections take less time and have generally less price depth, so that the resultant mentality becomes "BUY THE DIPS" or "Hooray! Another dip to buy". When making money becomes this robotic, then likely something very different is about to happen.
What also happens is that "sell stop" orders can accumulate under previous correction lows and then a short, sharp correction ensues.
The longer term forecast I had published near the beginning of the year forecasted the market to move sideways to higher for the year, so this forecast is tempered by that longer term structure. Of course, any guess is just a guess and my ego is not involved in this analysis. I am only offering a vision into the setup that I see in place in the market and the path of least resistance that lies ahead for the stock market. I hope we can adjust our positions to profit from this pattern setup.
All the best,
Tim
1:57PM EST Wednesday, June 5, 2013
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