Allow Me One Dark Thought

Given what seems to me to be a broad consensus that we’re heading lower, among many other factors, I would prefer to see a major low be put in. However, if that low is in, we should begin moving up with vigor. We’re not yet. We might soon. FOMC can be a terrific catalyst. But it can also be a terrific fakeout.

So, in the spirit of looking both ways while I cross the road here, let’s look at something dark.

From the 5/22 low, we’re moving up, but so far it’s been lethargic. If all the bad money has been flushed, new, fresh, invigorated buyers should step in at what they know are great prices. Instead, we’re moving up sloppily (so far).

Looking at the structure, it’s possible that we’re making yet another triangle (the last of which I warned about recently here).

If we take out the upper trend line with great conviction and enthusiasm, terrific. But if that level (a little over 4000 remains as resistance—or if we can’t even bother to get up there), it’s possible that we just keep falling. Perhaps just too damned many people are looking for a rally, I don’t know.

ES

There are variations, too, such as this (where even if we do get above the prior high, we stall just above it):

ES

I need to see institutions step in really hard and want to buy this market, and until then, I’m just groping based off of my assessment that people are way too bearish here. I can’t believe—given that alone—that we can’t even muster a strong, multi-week short squeeze. Is everyone looking for a squeeze?

So, I’ve just got to sit back and watch.

On the one hand, we’re looooong overdue for a real bounce; on the other hand, the bears have momentum until they don’t.

I would think, given counts like this, that we shouldn’t be producing this sloppy shit here. If we do get a rally for FOMC, I will likely take hedges, just to be safe.


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