It amazes me when I enter an investment chatroom and see all the pumpers, pumping SPY today like it's gonna sky rocket from here. Like it's going to blow through the all-time high reached at the end of July... Listen, we are in a consolidation, it's that SIMPLE! Until this consolidation is broken - either a close below lowest point of consolidation or a close above highest point of consolidation - we will simply be in a consolidation pattern. A holding pattern if you will.
But, one big reason I have a bearish bias and believe a break to the downside is more likely, is because we entered this pattern to the downside. Most patterns break to the bias they entered on. Not only that, but this consolidation is strikingly similar to the one right before the December lows were hit. Does this mean things can't change? Absolutely NOT! The market has a mind of its own. However, right now, we don't know because it's not moving. From a technical standpoint, I don't know about you, but I lean towards the statistical advantages. In this case, the advantage is that we entered this consolidation from the top to the bottom. When this happens, it's usually just a reflection period after the market decides it may be overpriced (or under priced if a rally up happened instead).
I like to have a good mix of fundamentals with my charts. Right now, the only fundamental that matters in my opinion is TRADE!! The trade war is the driving force for all things fundamental right now. It was a mix of trade war and interest rates, but I think the interest rates have been put on the back burner for now.
Either way, I just wanted to share these thoughts because it amazes me when I see all the complacency in these investor chat rooms.
Good luck to all! And may we all profit!!
But, one big reason I have a bearish bias and believe a break to the downside is more likely, is because we entered this pattern to the downside. Most patterns break to the bias they entered on. Not only that, but this consolidation is strikingly similar to the one right before the December lows were hit. Does this mean things can't change? Absolutely NOT! The market has a mind of its own. However, right now, we don't know because it's not moving. From a technical standpoint, I don't know about you, but I lean towards the statistical advantages. In this case, the advantage is that we entered this consolidation from the top to the bottom. When this happens, it's usually just a reflection period after the market decides it may be overpriced (or under priced if a rally up happened instead).
I like to have a good mix of fundamentals with my charts. Right now, the only fundamental that matters in my opinion is TRADE!! The trade war is the driving force for all things fundamental right now. It was a mix of trade war and interest rates, but I think the interest rates have been put on the back burner for now.
Either way, I just wanted to share these thoughts because it amazes me when I see all the complacency in these investor chat rooms.
Good luck to all! And may we all profit!!