Hey ya’ll, I’m back and coming in spitting hot fire with an unprecedented vengeance. After vacation last week I came back to an absolute shit-show in ThinkOrSwim and my software was more F’d up than Jeb’s campaign hopes. To make a long story short, in my last post I gave a quick update on the Nikkei. The major key there was holding 1500 while the Spoos held 1800. Both of which happened and we proceeded to stick it to the stubborn bears yet again.
Our target of 1950 was hit yesterday, nothing special there. A simple support/resistance trade for all my old-timer technical analysis fans.
Now we wait.
The big thing I’m seeing EVERYWHERE is that the bears are re-shorting 1950 and the bulls are too scared to hold — like a bad ex-girlfriend, they’re afraid of another spanking.
Currently, I am flat after being short the UVXY for a week or so. The big thing going forward is to be open-minded. IF we go higher, this will be yet ANOTHER hated rally.
It will be low volume, it will be overnight gapping, etc. Basically 2015 all over again. Get rid of your “thoughts” and what your “common sense” tells you, because the market will rip that right out of your brain and leave you begging for crumbs in the back-alley.
Keep an eye on the longer-term time frames (weekly and monthly charts) as the intra-day choppy action will continue around 1900.
March will be an interesting month for the markets, position yourself wisely.
As you can see, yesterday we made an ever-so-slightly higher-high from the 1/13 outside day candle – a prime example of the broadening formation effect, what we preach here. Going forward a gap fill down to 192 wouldn’t be too out of the ordinary, and possibly a decent spot to get back long. Overall we are not at a spot to put too much risk on to the long side, but if you’re building core long positions I’d be buying into these dips. If you’re bullish, be greedy down here into these dips, another hated rally is on the horizon.
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