TLDR: I think we’re gonna go up a little more from here before this rally fades and we have our next big move. I think we’re gonna have a pullback soon to have the next leg higher, but we’ll see what happens.
On the monthly, we have increasing volume on a hammer candle that is also kinda a bullish engulfing. Normally this would be a very bullish sign, but we’ve been going sideways for the past 5 months so we’ll see what happens. MACD is still above the 0 line and RSI is back above the 50. All bullish signs and we’ll see if we can keep this up.
On the weekly, we have decreasing volume on these green weeks. Makes me kinda suspicious of this rally, but we’ll see what happens. Overall bullish and I think we go back to the February highs or around there before we top. Not much else to say other than we’re nearing the RSI levels where all other tops have formed.
On the daily, we have a ton of gaps below, which I think we’ll fill after this rally. We’re also approaching some trendlines so I expect us to either start to pullback here or go up a bit higher and then pullback. RSI is showing lots of strength and MACD is also showing lots of strength. I am waiting for a pullback and to buy calls because I don’t expect this rally to just randomly fade away.
On the hourly, we are very overextended. Maybe we form another high with a small pullback to have a bearish divergence for a big pullback or we just pullback right now and then form the bearish divergence later on. Overall though, hourly is very strong and I expect most people to buy the dip once we pullback and profit take.
Another good sign of this rally is the junk bonds. They’re rallying hard, showing that markets may continue to rally higher for now.
Overall, I am bullish for a bit longer and don’t see anything that can derail this rally for now. Maybe until the next Fed we go bull who knows. But I am waiting for a pullback to buy some calls and ride up. Maybe April will be good this year. Good luck all.
On the hourly, we had a decent dick down to start the day and then a rally to finish the day. There is a bearish divergence on the RSI and the MACD now. I expect this to play out soon and have us start to pullback, esp since we’re right at some big trendlines.
Today was a low volume day with us basically on some uptrend lines which I don’t think will break given how overextended we are right now. I still expect the pullback to be bought because there is a lot of bullish momentum right now. We’ll see if this bull momentum can lead to anything bigger though.
Another big sign I’m looking at is the JNK. Had a big move down and not looking good for this rally to continue. But we’ll see what happens. Yields are still kinda low and the dollar is continuing to head lower.
Overall, I expect the pullback to happen and for it to occur for 2ish days because I don’t think bulls will just let the market freefall during a pullback. I expect for the pullback to be bought and for us to head higher, but we’ll see what actually happens. Good luck all.
On the hourly, we see SPX rejecting off the trendlines and the bearish divergence playing out. I expect us to bottom when the RSI is at or below the 50 level which should be around the green gap fill area. On the 5 min tho, I do see a potential double bottom so we’ll see if we rally a bit here before we head lower.
On the daily, we don’t see an elevated selling volume (looking at SPY). We are in a strong uptrend and I don’t expect this uptrend to just randomly end here. I will be looking for the RSI to head to the 50 level and then have us bounce to have a bearish divergence or set up a lower high. Bullish momentum is strong shown by the MACD and RSI.
So some warning signs that I’m seeing that this might be a bull trap is that the small caps (IWM) is not rallying hard with this rally. It’s looking very weak and if the low caps aren’t rallying, I don’t think the market is actually strong and this bullish momentum can lead to anything bigger.
A couple good signs that I’m seeing is the yields staying lower and the dollar continuing to head lower. Another sign that I’m seeing is that the Junk bonds aren’t heading too much lower. Shows some strength in these markets so we’ll see how much bullish momentum we have left.
Overall, I am bearish because I am expecting this pullback to last a bit longer, but I am expecting one more bullish push. What happens after will depend on what I see in the markets. But, Wednesday I expect a red day and then some green days Thursday into next week to make a higher high or a lower high. Good luck all.
On the hourly, it seems like the selling has stopped and we’re on to making new highs. The RSI went to the 50 level and bouncing and the MACD is slowing down at the 0 level. There are some upticks on the hourly candles, but the last candle was a strong close, showing that bears are losing control.
On the daily, we have a doji candle with a bigger downwick. Shows that bulls stepped in and the volume isn’t high either, showing that bearish momentum is slowing here. I think we have a couple days of green left to either retest the trendline or to test the Feb highs. Bullish momentum is still strong on the daily charts so I wouldn’t expect all bearish shit here.
The DOW was up today while all the other markets were down. I think this is a sign that Dow will help push SPY up for the last leg up and then have us shit down. Tech is shitting the bed and it seems like sector rotation is happening as the healthcare and consumers were green today while tech and others were red.
On the hourly, we had a double bottom form and we’re rallying off of that right now. We had good support right above the gap and it seems like we’re going to rally from here. The MACD is turning back to bullish and the RSI is still in the bullish momentum. Seems like the bullish momentum is coming back for one last pump and then form bearish divergences to sell off.
On the daily, we have another similar volume day but with a solid green bar. Seems bullish enough for me and I’m looking at the purple trendline to top or somewhere near the Feb tops. Daily is still in an uptrend so we’ll see how much higher we continue up.
On the weekly, we have another lower volume week with a doji. I think that this signals that this rally is going to die off soon. The volume is dying off and momentum isn’t continuing higher. I think maybe the inflation data or FOMC minutes could lead to a sell off. If it comes out bearish, we could fill all the gaps below EOW.
Another reason why I’m being more bearish right now after a pump is because the Junk bonds and small caps (IWM) are not rallying with the market. They’re looking very weak and they generally show the direction markets will head towards. The JNK and IWM are not agreeing with this rally.
Overall, bullish very short term and then bearish afterwards. But we’ll see how low we go. We could just continue to range trade and then breakout randomly or we bottomed and we’re gonna go moon. Good luck all.
Tl;dr: It is more likely that we go up, and not down, into opex (4/21).
Both CPI and FOMC meeting minutes turned out to be nothing burgers. The market was already signaling this through the VIX structure, and we talked about the historically low vol in TF using the graph below:
SPX 4000 is significant support, and 4100, 4150 and 4200 are decent levels too. Given where we are in the opex cycle and that we are in positive gamma territor, this is where vanna and charm flows start providing tailwind.
Which suggests that we could slowly walk up to the 4200 level next week. We are unlikely to breach 4200 though.
Note that if we do end up near 4200, it does set us up for a downward move after opex, and we could see some downward front-running after Wed (4/19). But that story is for late next week.
On the hourly, we moved very slightly above to form the double top and a big bearish divergence on both the RSI and MACD. If we break the support where we bounced 3 times, I’m gonna expect a big selloff to fill our gaps. Worth watching tomorrow.
On the daily, we had a big volume red candle. If we have another day of red with volume, I’m going to see it as confirmation and we have a selloff for the next week or so. There is a bearish divergence on the RSI on the daily too. But, we are still in an uptrend so I’m not gonna expect 350 or whatever right now. I’ll expect a bigger pullback that can lead into more upside.
Another reason why I’m bearish is because the tech sector is not looking strong. The megas are also dying, esp Apple. Doesn’t give me hope or belief that markets are gonna just randomly shoot up from here. QQQ is breaking its support and heading lower. I think that SPX is gonna follow soon.
Overall, I’m bearish and expecting more selloffs incoming. But we’ll see what happens and if markets are gonna shrug off the news. Good luck all.
On the hourly, we have a slowly rising wedge and it seems like momentum is going away. Each new high we make, we make another bearish divergence on the RSI and MACD. This is a big red flag, but until this actually plays out and we die off, it means nothing.
Another red flag that I see is that on SPY, we have a decreasing volume on this move up. This shows that momentum is disappearing and we’re still not able to break above the purple trendline. The RSI and MACD aren’t moving up either which is not good.
Another red flag that I’m seeing is that junk bonds aren’t making higher highs like SPX. This is a red flag and we’ll see if this divergence is right again and SPX soon follows JNK and falls off a cliff.
Overall, every dip is getting bought up so far, but there are a ton of bearish divergences and red flags to look out for. I’m cautious of more upside, but until we actually start to make lower lows, I’m gonna remain bullish because market is retarded.
Still feeling this from last week, that we likely crest today or tomorrow. 4150 is the magnet for sure, but anything that would move markets to 4200 will also enjoy tailwind from the dehedging of the puts (in blue).
Then, starting as early as Thu (4/20) and as late as next Tue (4/25), we could see some weakness as all these calls evaporate, and are dehedged. The weakness could last all the way to FOMC on May 3, helped by a return of VIX from both vixpiration today, and vol increase related to FOMC.
On the daily, you can see a clear wedge. We’ve bounced off of it 3 days in a row, but we’ll see what happens. The MACD is about to roll over and RSI is turning over. Volume is lowering and it doesn’t seem like we’re going to keep going up, but we’ll see what happens.
I guess one good sign you can see is that the junk bonds are having some solid green days while the markets are flat. Maybe sign that we’ll get a run up, but JNK are making lower highs compared to the markets.
Overall, seems like momentum is weak and the rally is gonna have a major pullback soon. We’ll see what happens and good luck
On the hourly, we’re at the previous low where we bounced off and we have a bullish divergence on the RSI, but not the MACD. Interesting to see, so there’s a chance that we have a bounce, but not as good of a chance. We did change the trend setting up lower highs and lower lows, so we’ll see if we change trends again or keep going lower.
On the daily, we have lower volume (looking at SPY) showing that this selloff may not be supported. The RSI is also at 50 so we could bounce here. Interesting to see and I think tomorrow will tell us the direction we’ll be going for a bit.
Another bullish sign that I’m seeing is that the junk bonds are not making lower lows like SPX. This could be a sign that we’re going to rally tomorrow.
VIX was also up 10% Tuesday, which means that we have a green day within 2 trading days. So combined with the bullish divergences, I think there’s a good chance that we rally. But something to keep in mind is that Apple has its earnings Thursday close. That could lead to derisking and markets could continue to selloff with Powell tomorrow. Powell did say there was no decision on rate pause so we’ll see if markets sell off with that.
Overall, I’m looking at a bounce, but I won’t be surprised if we keep heading lower. I think the best play is to wait an hour or 2 to see what the markets want to do. Good luck all.