Like earlier, when I expressed concerns about an interpretation I have been considering, we may also revisit the structure I discussed here.
If we do see weakness here in the next day or two (which I am inclined toward given the seemingly poor structure we have formed off of our recent low—it’s not a very good impulse wave) and if the move lower is not completely disgusting, the inverse may be viewed as a complex one, meaning: since the “left shoulder” had two spikes, then both the “head” and the “right shoulder” often do as well. So, we can revisit our recent low (but “lightly” so) and get that 5th orange wave discussed here, then, if the bulls have anything left, a good, impulsive rally would be long overdue and deserved.
I read somewhere the other day that last week saw the greatest increase in outright short selling in all of known market history. How can we possibly crash under such conditions?
And with each passing day, I continue to see very excessive bearishness everywhere I look (hell, I’m starting to feel bearish too lol; that shit’s contagious), and it just keeps getting worse lol. So, who knows how bad it can get. The AAII survey was conducted today and the results will be released tomorrow. Let’s see how suicidal Wall Street is tomorrow.
Elements of my thesis look ok here. Yields decidedly turned lower and are back under their long-term trend line (you can see that pictorially here), oil is looking very weak, and both of these should be signaling the end of the inflation trade (and so the end of the Fed stress). The dollar is still elevated and equities still need a decisive turn, so the picture isn’t perfect yet. I hope it continues to evolve as I have been anticipating.
