RAINING ON THE PARADE
Everyone is bullish and excited and feels a heck of a lot better than they did on Tuesday when we had the Sonders bottom. Well, not so fast as we now have this huge gap to fill on the VXO and the opening gap to fill on the SPX. In addition, we have the SPX back at the 200 day SMA and the 2 day RSI back at the overbought 85 level. One other thing, the VXO is now 15% below its 10 day SMA. Pretty amazing how fast we go from dismay and disbelief to euphoria.The TRIN is down to .22 and I can't remember the last time I saw it there, but the general rule is if the TRIN closes below .6, the chances are about 80% that the markets will sell off the next day. Of course it was only a few days ago that the TRIN was at 2.83 and that did't work as a buy signal so we will have to wait and see. FUN FUN FUN.
posted by DAVID at
3:55 PM
3 Comments:
I think your dead right in your thinking; however I'm hoping for a little bit of follow thru to liquidate my longs. (hope is not a good trading tatic).
-Tom
To hell with these short term indicators. They only work half the time. I will hold at least until the next Fed meeting. Say hello to the summer rally.
I do expect a major whacking for the markets before October - but, in the short run, I am willing to bet on a test of the old highs.
I just write them as I see them- no hope no nothing- just looking at what the most likely scenario will be- and those gap fills are what I see
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