Posts tagged possible stock market crash
Indecision?
Jul 6th
that’s what we got today…
As for tomorrow, I don’t know where we are going? That’s why they call that the “indecision candle”, or doji. It looks very bearish how it went up to the 1040 level that I expect on Friday (a day early I was), but we should rally at some point soon.
We are very oversold now, and appear to be basing, or consolidating in this lower range. That could be viewed as bullish, or it could be viewed as a bear flag forming… which is bearish.
The 15 minute chart look ready to rally up tomorrow, and the MACD’s are recycling back up from oversold, and the histogram bars look ready to cross the zero line as well. We are also forming a support trendline from the 1010 low, and the higher low at 1015, and now 1018 today.
The 60 minute chart looks ready to go back up and make a second histogram tower above the zero line. If it’s a lower tower, then it would be putting in a negative divergence. The bulls need it to be a higher tower then the top of today’s tower when the market hit 1040.
The daily chart put in a higher low on the histogram bar today. That shows that an uptrend is about to start soon. The only bad thing about that, is that the MACD’s aren’t rolling back up yet. And, ADX line is still rising. The negative DI line did roll over today, and is now pointing down, and the positive DI line curled up today, so that’s bullish.
The RSI turned back up too, and didn’t penetrate the 30 level (if it did, that’s really bearish). But, the charts seem mixed overall. I can see bullish points of view and bearish, so I just don’t know what to think about tomorrow?
The weekly chart is still very bearish, and isn’t showing any signs of going up yet. That means we should expect another down week, although that just doesn’t seem likely too me. Just because I see how oversold it is, and should rally. I’m still expecting a move to 1070 soon… but when does it start?
The news out this week isn’t really much of anything important, so with this light volume, you would think that we are going to start a rally this week. That’s why I don’t think this week will be down, even though the charts tell me it will. I’m obviously just going on my gut feeling that we are going to start that rally tomorrow, and not continue to sell off.
So, I wait for the rally, like all the other bears do. The bulls are long, and the bears are waiting to get short at a higher level. Will it happen? Who knows? Not me, that’s for sure.
Good luck to everyone…
Red
Update: In the afterhours session, I just caught this print of 106.20 spy. It’s likely to be our high tomorrow, should we rally.
Weekend Update…
Jul 4th
I can’t find anything bullish?
I wasn’t sure what to say this weekend, so I’ll keep it short and simple. I looked hard for a reason to see a gap up on Tuesday, but I can’t find one? Yes we are overdue… yes we need one… but I just can’t see it in the charts yet? Last Thursday I did a video explaining that I expected a move to 1040 on Friday… but it didn’t happen?
Friday had everything going for it. It had light volume, a holiday weekend in front of it, and traders leaving early… but it failed to rally? In fact, the brief rally into the close was sold off in one 10 minute bearish engulfing candle. Not good for the bulls at all.
While I still think we will see that 1070.50 spx fake print soon, it might not happen until we put in a lower low first. While we did that last week, it didn’t come with any panic selling, and that’s what concerns me. We need a capitulation day to wipe-out all the bulls, and get every bear back in… short again.
Most bears probably closed up their positions on Friday, expecting a rally next week. After all, who would be brave enough to hold shorts over a 3 day weekend, after selling off for 2 weeks straight now? I’d say those bears are in cash, and I’d guess that there were some bulls that went long into the weekend… but not many.
I think it’s going to catch a lot of people off guard if it goes down instead of up on Tuesday. Anyway, I’ll keep this short, like I said. But one other thing… you should watch this video below about the BP disaster, it confirms what I thought all along… it was another false flag event.
Red
Happy 4th of July everyone!
Update: This is a very interesting video by Karl Denninger, showing how the market in currently (as in July 4th, 2010) being manipulated up and down with fake bids and sells. Watch it… it’s worth your time.
Jobs, Jobs, And Less Jobs…
Jul 1st
… unless you want to clean up an oil spill for BP of course.
Yes, the numbers were horrible today… for the Continuing Claims and Initial Claims that is. Tomorrow has the Nonfarm Payroll and Unemployment Rate, which should be just as bad. But, we are very oversold right now, so I’m expecting a sell off first, then a rally.
We went down to within 41 cents of the 100.72 spy fake print, before reversing hard into the close. I still think a down move to the 990 area is coming, but not tomorrow. I think the move down in the morning will only put in a higher low, and then rally the rest of the day, closing positive.
There is a lot of resistance in the 1040 area now, and I think that will stop the advance tomorrow, and could be the closing price too? However, I have a fake print of 1070.50 too, and should 1040 not hold back the bulls… a massive short squeeze could happen, taking us up to that level.
Now don’t get me wrong, I don’t think we will hit that target tomorrow… but anything is possible, so keep that in mind. I feel like we will hit 1040, and close around there, then hit 1070 next week, at which point I would go short again.
But let’s just play it one day at a time. For tomorrow, a possible down move early in the morning on jobs data and rally the rest of the day is my forecast for Friday.
Good luck everyone…
Red
Bear Annihilation…
Jun 10th
Are there any Bears left alive?
Today was the largest short squeeze ever, as Mr. TopStep quoted on their Twitter feed. I believe it, as I’m so far underwater on my short positions now, I think I can see the oil coming up from the seabed floor now.
I’ve covered basically my thoughts in the video above, but I want to add some more. The triangle breakout on the market from the top in April is only a slight breakout, and could still be considered “still inside the triangle/channel”… The downward sloping top trendline of the channel (look at 60 minute chart for channel), along with the horizontal support line around the 1040 level, forms a very larger triangle pattern.
It’s basically the same upper trendline of the falling channel that is seen clearly on the 60 minute chart, only without the lower sloping trendline of the channel. Just replace it with the horizontal support line around the 1040 area, and you have your large triangle. Hopefully that makes sense too you (as the horizontal line isn’t shown in the chart)?
Today the market popped outside the triangle (also the top trendline on the downward sloping falling channel… which is actually the same line). But, I believe it’s just a head fake, and it will reverse hard and go back down next week.
The main pattern that is now forming is called a “MA” pattern. These MA patterns, as explained in the video are very bearish, and if it plays out… an 80-100 point move down is too be expected. But, even though I still believe we will sell off hard next week, I have to consider how much open interest there is on the June put options, as next week is opx for June.
So, the possibility of a pattern failure is larger then usual, and that leaves the door open for a gap up on Monday and a continued run up or sideways into Friday. I don’t believe that to be the case, but it is possible. They want to take everyones’ money, and I just don’t know if there are now more bulls or bears left in the market? The open interest says there are more bears, but today’s squeeze could have a lot of them switching sides?
Needless to say, I’m disappointed by today’s gap up instead of gap down, but it totally worked by faking out everyone out… especially me. Again, I don’t expect much for tomorrow but a flat day overall. A move up to the 1093.56 20ema on the daily chart is likely, but I expect it to pull back and close around where it opens… and not break that level.
The best hope the bears can have is for every other blog to now start calling for 1100 or better, to form the right shoulder that appears so obvious now, as the next likely target. First 1100, then 1120, and finally 1150 where all the bulls can exit safely and the bears can board safely. Seems too easy too me, just like crashing this week was too easy. So next week looks like the rally up in opx that will make that right shoulder… which again, seems too easy too me.
Best of luck to both bulls and bears…
Red
