S&P 500 Update

What a liquidation break.

I continue to have low confidence in us moving materially lower.

I have a couple of options here. On the futures, I can still count it as a nest (green 1-2, followed by orange 1-2), but I cannot do so on the cash session, as we’ve taken out the low from 5/19 (futures traded much lower that night, and so it’s not an issue there).

So long as the 5/12 low holds, we may count it like this, putting in minor (green) 2 now:


The measured move of the “bear flag” is 372, and a whole hell of lot of people are expecting that, especially now. But, so far, in reality, we only have 3 higher lows (on futures; 2 on cash). That’s not good enough for me to get bearish, and any bear’s lingering doubts about their ability to sell every rip were removed today with this nice little spill.

I still think we’re putting in a low, and as we move up (if we do), that confidence that rallies will always fail will propel us quite high, I believe.

And even if we take out the 5/12 low, I still won’t be able to get too bearish yet, as it may simply be that we’re putting in that big pink “C” here rather than there. I’m sorry to have to be like this, but I have a very good idea of what is going to happen with so many folks all in the same trade here. I wish I could time it perfectly, but I do believe it’s coming and hopefully soon.

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One thought on “S&P 500 Update”

  1. I’m beginning to believe that too many people, retail and institutions alike, are feeling like 2020-21 “should” be back and are looking at the RSI and concluding that we “have to” start going up soon.

    I’m also beginning to think that retail sentiment matters far less now, as much of retail has been hosed in a market that always went up, until it didn’t.

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