Fellow traders — welcome to 2019! I hope you had a great New Years eve and that your hangover is manageable and goes away quickly. Or if not that — then I hope you don’t DIE from your hangover.
What’s that — you’re still drinking? okay — have at it. When you are done — here’s a market update —
Seriously. What a few weeks in the market. If you can’t tell — the short term trend has been — say it with me — DOWN.
We had a bounce last week — and what a bounce it was! The markets were UP more in a single day than I’ve seen since 2009 lows.
Anyway — we bounced so hard it took us over the 50 hour hour moving average and now I’m looking for a continuation over the $251.40 — or more DOWNSIDE — which we all know is probably the case.
Although — now that I just said it — watch for more UPSIDE,
Ouch! Look at this chart! Is this 2008? God. Superman. Santa Clause. Someone save us! Please.
From a high of 293.94 to a low on 12/26 of 233.76 is a loss of over -20%. Typically, bear markets are defined as downside moves of greater than -20% from highs — so — OUCH.
Also — notice on the chart the BEAR DEATH CROSS — that’s marked by the 50 day moving average crossing UNDER the 200 day moving average.
So where are we going?
Take a look at the weekly chart above. Isn’t it beautiful? Not if you are losing money I suppose — but from a technical standpoint it — is — freaking — perfect.
Also — notice the huge volume in January — I’d have to say that was the actual top — now we have huge short positions built up by smart money that are going to have to play out before the market turns.
Because of that i see a possible next leg down taking us to the 214 – 182 level.
Still — we have to wait and see. For now we have the following trends:
- Short Term: Sideways
- Mid-Term: Down
- Long Term: Down
Until next time — good luck with that hangover!