I turn dials and fiddle with knobs to hone in on harmonic rotations
Joined Oct 26, 2011
4,121 Blog Posts

Traders All Know a Relief Rally

The morning commentary from Twitter and blog traders has identical sentiment from bulls and bears alike: this is a relief rally and may last a few days but will eventually run out of steam.  This sentiment is echoed by some of the more noble people I read.  Actually, it’s echoed by too many traders.

I see the following two scenarios most likely as we enter Monday afternoon:

All short-timeframe traders will begin front running each other and we’ll have a weak close


We close firm, with markets closing above their midpoint on the day

I’ll use today’s close as a hand tip, and my expectation is we see one of these scenarios play out, listed respectively to the above outcomes:

A Weak close leads to weakness throughout the short week, and then we go higher


We go mildly higher this week, than much higher the week after

I know and accept that markets rarely give such binary outcomes and I keep an open mind to the possibility of a sharp clawed bear market. Many trader’s favorite charts are broken.  However, I currently hold a portfolio of strong charts, and they look ready for another leg higher.  Have a look:

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