Monday, May 20, 2024

The Bulls Never Die!

Up in the morning, down hard midday, and back up into the close!  Wow, what a wild day it was...

(to watch on youtube, go to: http://www.youtube.com/watch?v=Kyj-SN4g7fU)

The market didn't play out exactly as I expected it to, but then again... it rarely does!  I expected it to roll over in the morning and sell off most of the day, and then rally back some on Friday... but it fooled me.  I guess "overbought" isn't the same as "extremely overbought", so the market rallied up in the morning hard... really stretching all the short term charts into very overbought territory.

Then about midday they finally rolled over and sold off fairly quick.  They went down to almost the 117.20 spy FP level, and then reversed back up into the close.  At the end of the day, all the short term charts started to turn back up from their oversold conditions.

This means tomorrow is very likely to rally up in the morning, as the charts are now supporting a move up, and they have another POMO day tomorrow too.  Plus it's a Friday and an option expiration day too.  I believe it's the weekly's expiring this time.

That means they should rally up to pin the spy at a level that they have too pay out the least amount of option holders.  It's usually the "puts" that get squeezed hard on opx day, but not always.  Sometimes they push it down so they don't have too pay out the call holders.

However, tomorrow could go either way?  In the latest Mr. Topstep video, his guest speaker George Cavaligos quoted that "open interest has dropped as the market has rallied the last 2 days", which means that it doesn't need to be propped up as the market makers don't have to worry about pinning the levels because there aren't to many option holders left to pay out on.

This means that they could just allow the charts to play out naturally tomorrow when they finally get overbought around midday as the POMO money will be used up by then, as well as the charts themselves will have worked themselves into overbought territory again.

That doesn't mean that they will let them drop into the close of course, it only means that they don't have any real reason to manipulate the market higher (or hold at the high) because they aren't at risk of losing any money on the small amount of puts left in the market.

But, the government doesn't usually like to let the market drop on Friday as they want people to go out and spend money over the weekend... which a huge sell off on any Friday would make people think twice about spending money on their time off from work.  It's a game the gangsters play to trick the public into thinking that everything is OK (keep your eye on the carrot here in my right hand, while I pick your pocket with my left hand).

Anyway, I'm looking for a move up in the morning as the charts are now pointing back up again.  About noon or so, I'd estimate that they will get very overbought again, are could rollover into the close.  I say "could", because there won't be any more POMO money left to support the market the rest of the day, and there won't be any reason for the market makers to hold it up either.

So, it's free to fall simply based on the charts being overbought again.  But will it?  I don't know?  We'll have too wait and see I guess.  However, if it goes up all day and gets really overbought again, it could set Monday up as a big down day.  Not that I'm calling for one, or believe it will happen, as most Monday's are "Bullish Monday's"... but the charts could be aligned that way by the close tomorrow.

For now though, let's just wait and see.  I'm calling for up in the morning, and it stalling around midday.  At that point it could be held there until the close, or roll back down and sell off in it... probably closing lower then the opening level if the momentum really kicks in.

Red

George

Red
Author: Red

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Deja Vu Trading
Deja Vu Trading
13 years ago

I’ve got a wedge on the 5 day EMA on CPCE that broke out today. Maybe it means something, maybe not. I just know that when the 20 period slope on CPCE crosses zero, it’s bearish. It has failed twice in a row and this is the third. I just can’t see how it can continue to fail. In the end, I may have to re-draw the wedge here into a channel or something.

http://stockcharts.com/h-sc/ui?s=$CPCE&p=D&yr=0&mn=8&dy=0&id=p68373158031&a=202131234

Red Dragon Leo
13 years ago

Nice chart… and yes, the odds favor the bears. But as we all know, the gangsters run the market and can manipulate it higher for longer then the bears can stay in the game.

But, I do think it will end soon. However, there might not be any bears left to short the market then. It really gets old, the same old manipulation crap that the gangster do everyday. As long as they have that printing press, they can keep extending the sell off for a future date.

While I think we are almost there, and next week should start the sell off, I wouldn’t bet my last dollar one it… as then I know I’d go broke! LOL.

ACP
ACP
13 years ago

Hell, if a Netflix having a major outage at the worst possible time doesn’t signal a market peak, I don’t know what does!

http://finance.yahoo.com/news/Netflix-suffers-big-outage-as-apf-1946704946.html?x=0&sec=topStories&pos=main&asset=&ccode=

Red Dragon Leo
13 years ago

We are close to a breakout one way or the other, and odds favor the bears right now. But of course there’s always more manipulation that could delay it longer. I just don’t think they can do it for more then a few more days.

I think we’ll see some selling into the close tomorrow, after the POMO money is used up in the morning session. I also think we’ll see a lot more selling next week too.

Even if they manage to hold the tape up tomorrow, that leaves Monday looking very bearish, as holding the charts up all day will make all the short term charts very overbought again.

zstockmiester
13 years ago

AMZN’s earnings report should make every bear VOMIT!
Here’s the JIST…
AMZN missed on Margins my ass…They are expanding their facilities, so they can handle all the tremendous increase in xmas volume they are expecting….the expansion is running into cost over-runs, which is typical.
KEYWORDS::::::
tremendous increase in xmas volume
tremendous increase in xmas volume
tremendous increase in xmas volume
I think we are going to get a xmas rally….What ELSE can you think?

zstockmiester
13 years ago

“Way up HIGH”

zstockmiester
13 years ago

after the AMZN earnings report, bear blogs, I’m convinced, are polluting the internet.
But, we gotta get a pullback…probably happens when I’m, “Somewhere, over the rainbow”.

Robert
13 years ago

Buy the weakness, sell into strength is the mantra. It has worked very well. Tax selling starting soon, be advised. Next week I see a downward bias. Dollar upside in nearterm…………………

anoopsan
13 years ago

S&P 500 Before opening bell : CLICK HERE

anoopsan
13 years ago

S&P 500 inside the range : CLICK HERE

Red Dragon Leo
13 years ago

It’s also in a triangle (5 minute chart) and looks to be a the apex now. I think it’s going to break to the upside, as we still are in the POMO zone… plus we have light volume as traders leave for the weekend, which usually favors the upside.

Red Dragon Leo
13 years ago

The charts are all looking toppy now, and might tired. I think she’s going to roll over soon. The upside breakout failed, and the money is about gone.

anoopsan
13 years ago

Diamond of S&P 500 : CLICK HERE

Anonymous
Anonymous
13 years ago

Gotta watch:

Go to Chrsi at 1:07:40

http://www.ritholtz.com/blog/2010/10/chris-whalen/

Red Dragon Leo
13 years ago

Market could break either way now, as it still has light volume which favors the upside, but the charts are overbought. It’s a tough call, as they don’t have the juice to fight the charts turning down, but no one is left to sell either.

Red Dragon Leo
13 years ago

Mr. Topsteps says… If the market closes with an inside day, “Watch Out on Monday”

http://mrtopstep.com/2010/10/22/thin-market-with-range-trading/

Red Dragon Leo
13 years ago

Thanks Jim… I’m watching it now.

ACP
ACP
13 years ago

Yup – really weird day. Looks like the only ones buying are the ones with the POMO money. It appears to be a juggling act between pumping equities and pumping the Euro, trying to break upward.

Red Dragon Leo
13 years ago

Yeah, they are trying to hold it in place until the close it seems. It’s making a bull flag, so it could breakout to the upside? Hard too says, as it’s so weak that a failure here would really be bad for the bulls.

Geccko23
Geccko23
13 years ago

Yes, this is a waste of a day. It looks like a pause day for the euro,gold, and crude oil. Dojis setup on the weeklies for the stock indices except Nasdaq which has a hanging man.

Red Dragon Leo
13 years ago

You know, (not forecasting this), but it’s actually the perfect setup for a big sell off on Monday… as no one is expecting anything.

Red Dragon Leo
13 years ago

Those are real I believe.

Trektrader
Trektrader
13 years ago

Two spikes on SPY. First one down to 118.14 the second up to 118.34. They want to keep us guessing…

Red Dragon Leo
13 years ago

A big move is definitely coming next week… but which way? The charts say down, but the Fed’s might have other plans. My gut (which is usually wrong… LOL) tells me we are going to have a surprise over the weekend, and trap a lot of bulls.

Geccko23
Geccko23
13 years ago

That is exactly what it’s setting up to be. Except I didn’t really have anything for the 25th except its 2months from the bottom and my cycles guru does have a cluster of cycles around here but they also extend furthur. There was a phat doji yesterday seen at the March 2009 low and black bars for the Nasdaq and QQQQs. I really don’t have any motivation to put on any more positions but I did just muster enought energy to add another emini put.

ACP
ACP
13 years ago

Any kind of pumping past this point would be a breeze up to 12000, which would be assinine. But then again, we ARE talking about the Fed.

“One crash a quarter is all we ask.”

Red Dragon Leo
13 years ago

Hell, I’d be happy with one 30-50 point correction a quarter at this point!

Reza
Reza
13 years ago

FDIC Called On To Put Bank Of America Into Receivership
http://stock.ly/3qubis

is it time to rally

ACP
ACP
13 years ago

Actually, I was talking about the Fed, heheh. The relationship between the Fed and the equities markets is like the relationship between the Highlander and hard drugs.

Keep pumping until you crash and die. Then resucitate and repeat until resucitation is no longer possible.

Pzy5t0
Pzy5t0
13 years ago

At least you keep your sense of humor Red! What do you think of the Wiki Leaks news, could cause quite a stir?

newbear
newbear
13 years ago

Something just happened to futures, can anyone confirm this sudden dive?

Red Dragon Leo
13 years ago

Where can you see the futures at? I still see them as closed from Friday, and not open until Sunday night.

Red Dragon Leo
13 years ago

I still don’t see anything? They look the same as the close on Friday. What am I missing here? What price level are you seeing the market at right now?

Red Dragon Leo
13 years ago

The “TF”? What index is that?

newbear
newbear
13 years ago

It was showing a low of 696 on TF about 2 hours ago. It’s not showing those quotes there now. Wonder if anyone else caught it.

newbear
newbear
13 years ago

Those are the russsell 2000 mini futures, there’s been a lot of strange things happening lately.

Red Dragon Leo
13 years ago

Well, I’m trying to find it, but that RT symbol doesn’t pull up the Russell index. What was the closing price of this index on Friday?

newbear
newbear
13 years ago

It closed around 702 then shot up to 707 and dived straight down to 696 just strange.

Apple Al
Apple Al
13 years ago

New – just checked that out and you’re right, chart shows trading activity today on TF??????!!!!!!! Doesn’t make sense, nothing else is open – weird

Apple Al
Apple Al
13 years ago

Another thing I just noticed looking at currency charts is a very drastic move in the DX (US $) after the close Friday, could be a false print

Red Dragon Leo
13 years ago

Weekend post is up…

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