I can’t believe that I haven’t seen this before and just had memories of hearing every one of these songs still being played in the 50s on our old wood stand up radio….thanks for the memories and so delightfully done! The market was negative exactly how I predicted it last Monday morning due to the combined effects of a grossly short term overbought condition brought about by 6 consecutive positive weeks as well as a looming BIG resistance level with the rate hike hammer back again as the catalyst for all these. The bonds market and the total equities put call ratio just aren’t moving in tandem in a typical bull market fashion much.
Such readiness to go straight down upon meeting a resistance level reminded me once again of August 2011 and October of 2007, when the market struggled at a certain new high, took a hit, came back up to test the new high again just to be beaten down into a very significant down trend. In fact, this pattern falls exactly within the structure that I expected (mentioned in my reports months ago) for major market crashes where the market struggles around a new high price for an extended period of months before going into critical failure for the ensuing market crash. For now, the market remains in short term bear trend within an intermediate and primary neutral trend.
With bond yields around recent highs and therefore a good escape for investors and total equities put call ratio steady in favor of put options trading ( learn what put options are for FREE ) exactly how it is everytime the market is truly bearish, I would see the next two weeks as extremely bearish inclined. Well, even though the market was slightly positive, the internals were more bearish than bullish with bond yields dropping across the board and total equities put call ratio still in the uncertain range. Join my Master’s Stock Options Picks Service to trade these short trades with me!).
However, with the market already off short term overbought condition and just a short throw away from the 30MA, there should only be one more down day before we need to see how the market behave around the 30MA to determine what is next. Even within the framework of an intermediate and primary neutral trend and a generally bearish long term outlook, there is room here for a rebound at least to the 2125 new high resistance level before the market see some real pressure.
For now, this remains an extremely tricky market to trade in. Definitely the time for extremely short trades (Just like our 13.7% profit in a single day on EWZ call options last week! Last Friday’s Jobs Report also increased the bearishness in the market with a huge huge better than expected reading that brought back the rate hike hammer over the heads of all investors. For now, the US market turns short term neutral trend within an intermediate and primary neutral trend.