TLDR: Charts for me look bullish, but I’m not ruling out that we absolutely shit the bed tomorrow. Main thing for tomorrow is the FOMC minutes release.
So on the hourly, we broke out of my bear flag and then immediately went back in for round 3 for 382. We didn’t manage to break through and so far in futures, we are not breaking through either. If we do break through tomorrow, this is going to be an explosive move upwards because there is barely any volume between 382 and 387. Because there are also many shorts at 382, I would assume some short covering would happen. Another thing to note is that there is no bearish divergence on the RSI, which is a good sign.
So on the daily, volume was up and higher than the red days that we had. This is a good sign and points to more moves to the upside. I personally think we get rejected near the 21 EMA area, but we’ll see. We broke through the 8 EMA and just range trading for now. Nothing much else to say other than hopefully we break out tomorrow. One thing to keep in mind though is that small pump did post something about how when VIX has a random spike intraday, it leads to a massive shitter the next day. Maybe we reject off 382 again and then completely shit the bed tomorrow. Who knows.
VIX thing
https://forums.ascendedtrading.com/t/vix-leaking-future-volatility-in-2-trading-days/14239/3
So VIX got crushed hard today which is bullish and got crushed at the blue downtrend line. I still want to see VIX at the yellow to mark the top of the rally or even at the blue uptrend to mark the top. Overall, VIX is showing more upside to the markets, although I don’t know how accurate that will be given the random VIX spike on Friday.
Yields are continuing to get dicked down and giving more room for markets to run. We can see this in Nasdaq (QQQ) especially because they are having some amazing outperforming days. Another ETF that’s doing well is the TLT. Maybe something to look into. Overall, seems bullish. Big elephant in the room is that we are right at the 0 line for the 2 year and 10 year inversion. If we start to invert, that’ll mark the signs that we are in a topping process and nearing a recession. If this inversion goes on for weeks, I’m willing to bet we make a new ATH. But if we start to spike up on the inversion, I’m willing to bet that we top near the 50 MA and then go into a full on recession.
So the dollar is hulk dicking up. Not a good sign for the markets, esp when the markets rallied hard, but the dollar did not come down. Something to note is that we have a triple bearish divergence on the dollar now. This is extremely bearish and could signal that the dollar has peaked. If this is the case, I’m willing to bet that we have a huge rally in equities.
Something to note is the crude oil. It got absolutely shat on today. The volume was huge too. This is capitulation and giving more fuel for stocks to have a bullish case. Something to note also is that for the month of June, it’s down heavy. It’s down 7% so could this signal that the CPI data will show signs of peaking and retracting? If this is the case, then maybe the markets will rally even harder.
Something minor to note is the PCC. It’s in no mans land which is kinda good for bulls because it shows that there is a lot more room to run up. But this is also typically the level where we topped so we’ll see what happens tomorrow.
Overall, lots of bullish signs, but until these play out, these are just signs. I want to see us break 382 and then the downtrend line for me to become bullish that June was the bottom.