NBER: We're in a recession. The record 10 year bull market is officially dead.
Market: Bet.
I don't even know what to say. This market is so void of rationality and logic that any type of TA is essentially worthless. We're entering in my opinion a new mania stage with the death of capitalism as we know it and the advent of corporate socialism to a degree we've never seen. (www.cnbc.com/2020/04...gger-businesses.html). Companies no longer have to worry about risk or moral hazard because the fed is their to bail them out, almost indefinitely. They claim this is for "the economy" and "jobs" but all this is is another huge transfer of wealth from the average American to the people who are at the top of the pyramid. There is no downside. Moral hazard is dead. And because of this we are in a mentally imbalanced quasi bull market where the market knows that if there's a downturn, the fed will be there to back stop it. In my opinion it's criminal. We're literally in a recession, with at least 13% unemployment, and we're back to pre COVID levels. With companies that have incredible amounts of debt being rewarded (BA), and companies who do claim bankruptcy actually have their stock prices back to pre bankruptcy levels (HTZ). We really do live in bizarro world.
We're starting to get uncomfortably overextended in every single market sector. What is justifying these prices? What is the market pricing in that we hadn't priced in before COVID? Interest rates? Hopes and dreams? I feel like if this doesn't correct before we go back to ATH's it of course will end in tears. The dark arts of the fed are not sustainable in my opinion and all it's doing is muddying the fundamental waters. Something is bound to break. But, with that being said there is apparently nothing that can stop this market. If we keep this up we may actually see $400/$4000 or even $450 by EOY. That would end in my opinion end in an incredible blow off top scenario and possibly send us back to $150 when we finally have reality set in.
Part, no, a lot of me feels like the normies are making too much money and the rug pull is coming to leave retail holding the bag. MM's and large funds and banks are literally experts in this and have the means to move the market. The question is when do they pull their support and send us back down? The chart is overextended. There's no arguing this. But there are no sellers. Literally none. All bears have been shot or taken to the gulags for reeducation. Pullbacks or corrections are back to being illegal on direction of commissar JPOW, ultimate arbiter of wealth in financial markets.
We obviously rallied into the close today after gapping up, again. And after testing $320 again on anemic volume we reversed and ultimately rallied into close. We're now positive for the year on NDX and SPX. My next target on the upside on SPY is $324, which was almost hit today. My next target after that is the gap fill a full $10 or 100 S&P handles away. Which we could honestly do within a week or less at this rate. This all depends on when big money feels like we've gone far enough and decides to pull the rug. Stairs up, elevator down. Which leads me to another point - We've been getting majority of this upward movements in overnight/premarket futures trading. This inherently builds these gains on weak market profile and structure. Meaning when the house of cards comes crashing down, it comes down hard and fast. The entire run up from the Oct low's to the Feb highs was built on poor market profile and structure, and we all saw how that played out. The gaps we have below need to be filled in order for me to be a full believer in this market "recovery." until then it's just cheap money manipulating the market higher essentially just wash trading their gains.
There were a couple notable things today. Horrible volume again today. VIX was actually UP. And IWM is looking like it needs a break and may want to roll over.
5m showing no sellers. Stonks only go up.
GAPS
Needs a break. The trend line we stopped on is from the lows of Aug-Oct 2019
SPX
ES testing and ultimately breaking resistance at $3210
Looking like we're about to go parabolic on the daily
IWM showing not as strong of a showing today
Daily running a little hot. This is overextended. Second day outside of the Bband as well
VIX showing another reaction off of the 200 period MA and actually UP over 5%. These are the tea leaves. Pay attention to them. We'd need another day or so to confirm a bottoming
NDX - Back to your regularly scheduled programming
Why tho?
XLF struggling at resistance. But has also had a monster run past couple weeks. It could just hang out around here to burn time off the clock while the BBands catch up
Parabolic
Because maybe people are going to start flying again
Silver taking a break and finding support on it's 50 period MA
Remember what i said about gold going for a liquidity hunt?
The 10yr finding support, but could be consolidating for another move downwards. Wouldn't be surprised to see a restest of the broken support
I personally added to my negative delta (short positions) today and also shorted the 10yr out of necessity. I have majority of my negative delta positions around Dec expiry because i do feel like this mutant market is broken and will act as such.
Like i said last week the market needs a linebacker shot to the knees to send us back to the lows, and even to get a generic pullback or small 5% correction. There is so much cognitive dissonance on display and with that no one cares we're in an election year, in the midst of a global pandemic that is getting worse globally, (www.nytimes.com...ses-record.html?playlistId...), and some of the worst political discourse and civil strife that we've seen since the civil rights/vietnam era. Not to mention the kneecapped economy we're in. I heard something interesting from a guest on Bloomberg radio today - that essentially the market has been front running the fed stimulus and once we get to a certain point these funds and MM's will reevaluate where we are economically, and if it's not up to snuff they'll leave the fed, and retail, holding the bag which makes sense.
At the beginning of next month we have a GDP print, and the start of earnings if we're looking for another catalyst. But we might already be at $350 by then.
Do not short this market until you have a clear signal or have a delta neutral strategy. The trend is obviously up, and there's no telling how far this will go before it turns around. Until something snaps we're perpetually headed upwards due to meth injections from the fed and the introduction of full corporate socialism. This is the new normal.
You are respinsible for your own trades. This is my personal opinion based on my own personal TA and not trading advice.
Market: Bet.
I don't even know what to say. This market is so void of rationality and logic that any type of TA is essentially worthless. We're entering in my opinion a new mania stage with the death of capitalism as we know it and the advent of corporate socialism to a degree we've never seen. (www.cnbc.com/2020/04...gger-businesses.html). Companies no longer have to worry about risk or moral hazard because the fed is their to bail them out, almost indefinitely. They claim this is for "the economy" and "jobs" but all this is is another huge transfer of wealth from the average American to the people who are at the top of the pyramid. There is no downside. Moral hazard is dead. And because of this we are in a mentally imbalanced quasi bull market where the market knows that if there's a downturn, the fed will be there to back stop it. In my opinion it's criminal. We're literally in a recession, with at least 13% unemployment, and we're back to pre COVID levels. With companies that have incredible amounts of debt being rewarded (BA), and companies who do claim bankruptcy actually have their stock prices back to pre bankruptcy levels (HTZ). We really do live in bizarro world.
We're starting to get uncomfortably overextended in every single market sector. What is justifying these prices? What is the market pricing in that we hadn't priced in before COVID? Interest rates? Hopes and dreams? I feel like if this doesn't correct before we go back to ATH's it of course will end in tears. The dark arts of the fed are not sustainable in my opinion and all it's doing is muddying the fundamental waters. Something is bound to break. But, with that being said there is apparently nothing that can stop this market. If we keep this up we may actually see $400/$4000 or even $450 by EOY. That would end in my opinion end in an incredible blow off top scenario and possibly send us back to $150 when we finally have reality set in.
Part, no, a lot of me feels like the normies are making too much money and the rug pull is coming to leave retail holding the bag. MM's and large funds and banks are literally experts in this and have the means to move the market. The question is when do they pull their support and send us back down? The chart is overextended. There's no arguing this. But there are no sellers. Literally none. All bears have been shot or taken to the gulags for reeducation. Pullbacks or corrections are back to being illegal on direction of commissar JPOW, ultimate arbiter of wealth in financial markets.
We obviously rallied into the close today after gapping up, again. And after testing $320 again on anemic volume we reversed and ultimately rallied into close. We're now positive for the year on NDX and SPX. My next target on the upside on SPY is $324, which was almost hit today. My next target after that is the gap fill a full $10 or 100 S&P handles away. Which we could honestly do within a week or less at this rate. This all depends on when big money feels like we've gone far enough and decides to pull the rug. Stairs up, elevator down. Which leads me to another point - We've been getting majority of this upward movements in overnight/premarket futures trading. This inherently builds these gains on weak market profile and structure. Meaning when the house of cards comes crashing down, it comes down hard and fast. The entire run up from the Oct low's to the Feb highs was built on poor market profile and structure, and we all saw how that played out. The gaps we have below need to be filled in order for me to be a full believer in this market "recovery." until then it's just cheap money manipulating the market higher essentially just wash trading their gains.
There were a couple notable things today. Horrible volume again today. VIX was actually UP. And IWM is looking like it needs a break and may want to roll over.
5m showing no sellers. Stonks only go up.
GAPS
Needs a break. The trend line we stopped on is from the lows of Aug-Oct 2019
ES testing and ultimately breaking resistance at $3210
IWM showing not as strong of a showing today
VIX showing another reaction off of the 200 period MA and actually UP over 5%. These are the tea leaves. Pay attention to them. We'd need another day or so to confirm a bottoming
NDX - Back to your regularly scheduled programming
Why tho?
XLF struggling at resistance. But has also had a monster run past couple weeks. It could just hang out around here to burn time off the clock while the BBands catch up
Parabolic
Because maybe people are going to start flying again
Silver taking a break and finding support on it's 50 period MA
Remember what i said about gold going for a liquidity hunt?
The 10yr finding support, but could be consolidating for another move downwards. Wouldn't be surprised to see a restest of the broken support
I personally added to my negative delta (short positions) today and also shorted the 10yr out of necessity. I have majority of my negative delta positions around Dec expiry because i do feel like this mutant market is broken and will act as such.
Like i said last week the market needs a linebacker shot to the knees to send us back to the lows, and even to get a generic pullback or small 5% correction. There is so much cognitive dissonance on display and with that no one cares we're in an election year, in the midst of a global pandemic that is getting worse globally, (www.nytimes.com...ses-record.html?playlistId...), and some of the worst political discourse and civil strife that we've seen since the civil rights/vietnam era. Not to mention the kneecapped economy we're in. I heard something interesting from a guest on Bloomberg radio today - that essentially the market has been front running the fed stimulus and once we get to a certain point these funds and MM's will reevaluate where we are economically, and if it's not up to snuff they'll leave the fed, and retail, holding the bag which makes sense.
At the beginning of next month we have a GDP print, and the start of earnings if we're looking for another catalyst. But we might already be at $350 by then.
Do not short this market until you have a clear signal or have a delta neutral strategy. The trend is obviously up, and there's no telling how far this will go before it turns around. Until something snaps we're perpetually headed upwards due to meth injections from the fed and the introduction of full corporate socialism. This is the new normal.
You are respinsible for your own trades. This is my personal opinion based on my own personal TA and not trading advice.
Trade closed: target reached:
Obviously futures are down in premarket. Sellers need to show up or else the buy the dip crowd is going to have a field day. Watch for $320 to break, and if that does the low of yesterday. If that breaks watch for the gap to get filled at $312.
Comment:
Unless volume picks up this is a bear trap. All it will take is an infusion of volume to retrace back to $320+
Comment:
Boom.
Comment:
Possible H&S on the 5 min. If we break today's low we're headed much lower.
Comment:
Also on ES hourly.
