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On Monday evening, I wrote a post to my Gold and Diamond subscribers pointing out, among other things, the irksome wall of support that was, apropos of nothing, supporting prices. In spite of weakness, it just kept hitting that wall and bouncing. When I turned off my monitors last night, the ES was down 24, but sure enough, it’s up double digits as I’m typing this. Because: Fed.
For me, although there are always of course bigger picture scenarios developing as well, the best way to view the market in the near term is to see it as a series of inflection points which generally have a more likely looking option for the next move, but can always break either way. My next to last post on Wednesday 29th April was at one such inflection point, within an uptrend move that was exhausted at the high that day, and delivered a solid retracement back to main support at the daily middle band, which then held and from there SPX has rallied almost back to the April rally high.
(more…)When I glanced at the chart of LYFT today, I noticed three interesting examples of charting phenomenon I wanted to point out:
It’s been an exciting week, with wild moves, bold pronouncements about markets, terrible economic news, expectations about interventions by governments, the number of US confirmed cases of COVID-19 climbing over a million, deaths from COVID-19 in the US climbing over 60,000 and over 235,000 worldwide. Exhausting and TGIF.
So what happened on the SPX over the course of the week? Well SPX closed last Friday at 2836.74, and closed tonight at 2830.71, so it dropped 6.03 handles over the week. Like a rollercoaster it was a wild ride that ultimately stopped sedately back where it started.
(more…)I have a gap in my work schedule this morning as we wait for the Fed this afternoon, so I thought I’d do a quick update on the inflection point that SPX has reached today, and talk about why the still very pervasive faith in the power of the Fed to keep asset prices up should not just be dismissed as irrational.
For me I look at the Fed and I know that I don’t see what most others seem to see, as I see a track record of successively larger failures that have created a Fed seemingly capable of trying anything to try to keep asset prices high, for fear that a serious decline in asset prices might unleash an economic whirlwind that they could not hope to control. They have my sympathy but, based on their track record, not my respect, and here is my image choice for the Fed today. If you’re enjoying some of the great demotivational posters that I’ve been using in a lot of my recent posts, and on and off for much of the last decade, check out the author website at despair.com for some good laughs and amusing gift ideas.
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