Yesterday the market trended higher and did so riding on top of a pile of flaming hot hundred dollar bills and five hundred euro bills (I love that denomination, don’t you?). What I mean to say is, just like any levitation in the market, it’s susceptible to the fickle hot money bailing.
What we want to see today to stay constructive on the market is not what we needed to see Monday or yesterday. Today, we’re lowering our expectations. If we can see a healthy consolidation of the impressive progress bulls made this week, it could allow healthy underlying charts to continue their advance.
Since we’ve cleared all nearby profile resistance in the S&P, we can gleam most insight from simply observing yesterday’s range and profile, and how we trade in relation to it.
As of 8:15 futures are priced three handles above yesterdays’ close, but within our value area spanning from 1443 to 1435. If we can hold the value area low (VAL) at 1434.75, I’ll consider our consolidation very constructive. Considering the speed and heat of the advance, I’m willing to remain constructive down to 1434 where the single prints begin, a level slippery and susceptible to a flush lower. I’ll cut my less desirable, most degenerate, and most overheated names should we trade below 1434.
New avatar running hot?
the block is hot