DJIA - Is Dow the weakest in a retracement?
Daily: Ichimoku is still bullish, but MACD is on Sell (with the good old negative divergence, but we got used to that during last few years :-) )
4 Hrs: This time frame is very interesting. It seems in recent short term bullish retracement of US equities, DJIA was really an underperformer. It couldn't even retrace to the 100 WMA and the bottom of the Kumo.
DMI is still bearish, with Slow Stoch turning down again on the back of recent price action.
Now look back at the daily chart again! 16000! Do you see it as far away? It is just a shy 2,5 % from current level. I know it feels a lot when mkts have been moving sideaway for so long time. Then try to zoom out your chart, and compare it now to the points where the two trendlines start from. Is it still a big distance? :-)
Equity bulls have a huge confidence still. But believe me, once we get to the breaking point, not the bears will kill them. The bulls will kill each other. The door will be too tight to exit once.
Also look at VIX index. It is again at the all time low level. Implied volatility is extremely low.
So what to play here? If Vol is so low, then buy the VIX. Also if volatility is so low, that means options are likely too cheap. So why not to buy a Put @ 16000 for July maturity? That costs ard 200 points. I think it really worths to pay this premium for a 2,5 % OTM option for 2 months.
Again: historically volatility is damn cheap, stocks are not! SP500 and DJIA are at appr. their all time highs. If I have to bet here, I rather buy June VIX than stocks.
If there is some form of correction or selloff coming, I think we will see it within next 1-1,5 weeks.
4 Hrs: This time frame is very interesting. It seems in recent short term bullish retracement of US equities, DJIA was really an underperformer. It couldn't even retrace to the 100 WMA and the bottom of the Kumo.
DMI is still bearish, with Slow Stoch turning down again on the back of recent price action.
Now look back at the daily chart again! 16000! Do you see it as far away? It is just a shy 2,5 % from current level. I know it feels a lot when mkts have been moving sideaway for so long time. Then try to zoom out your chart, and compare it now to the points where the two trendlines start from. Is it still a big distance? :-)
Equity bulls have a huge confidence still. But believe me, once we get to the breaking point, not the bears will kill them. The bulls will kill each other. The door will be too tight to exit once.
Also look at VIX index. It is again at the all time low level. Implied volatility is extremely low.
So what to play here? If Vol is so low, then buy the VIX. Also if volatility is so low, that means options are likely too cheap. So why not to buy a Put @ 16000 for July maturity? That costs ard 200 points. I think it really worths to pay this premium for a 2,5 % OTM option for 2 months.
Again: historically volatility is damn cheap, stocks are not! SP500 and DJIA are at appr. their all time highs. If I have to bet here, I rather buy June VIX than stocks.
If there is some form of correction or selloff coming, I think we will see it within next 1-1,5 weeks.