On June 8th the SPX made a perfect double bottom to the panic lows set in May. BTW–we alerted you to that as it happened, both here and on Twitter. We also mentioned that the two month old correction is probably over.
Now we are here, just a few short weeks later, with the SPX 80 points higher, and China is trying to re-ignite the risk trade again. They alone could get us to test our recent highs, but we will remains stuck in a trading range that will exhibit a certain characteristic.
The trading range will be SPX 1000 to 1200. But it will proceed to tighten up for weeks within the “inner portion” of the range and then kind of explode outwards to its fringes. This will serve to once again put the noose around most near-term trader-types necks. Then, when you least expect it, volatility will explode again–but stay within the overall confines of the range.
We may be starting Phase II of the credit crisis as Soros says and we maybe entering the next phase of the housing meltdown according to MW. But the market has had its histrionics and will get tougher from here. The bottom line is that you shall not get “too bearish or bullish”. Not yet, anyway.
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cool, thanks for the insights…
Indeud!!
I hate this market!
Scott – your stream has become a morning standard for me. However; 80% of what I do is in Canada on the TSX. How much of your work involves the TSX? I’m thinking of taking on a year’s sub for a trial, I guess the TSX thing is old habit or perhaps wanting a measure of familiarity.
Thanks for the a.m. show. ‘Not chasing’ has been ringing in my head for weeks now. You certainly are the ‘Dad’ here; the voice of moderation.
I suggest everyone stop by Scott’s tent and get checked out at some point during this wild party. He will set you straight if you have drunk too much, or not enough!
Thumbs up for yours: “not get too bearish or bullish”. I may be conservative and sometimes dont get the whole swing up or down, but I use neutral strategies most of the time, and get myself pretty nice income with lower risk :). Excellent work, keep it up.