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Of the quick thoughts this morning (given because of the jobs/GDP reaction), the second one looks quite excellent.
I remain inclined to count the structure as I have been, but will accept today as another internal swing, counting the whole structure as this:
The fibs are excellent. And it “looks” right as a flat. It’s important that we had the late day rally, because I would like to see us in a bullish “structure,” and the only thing I can latch onto is the “stealth bull flag.” And we’re back at the lower rail, so that’s fine as we just wicked through it. I call it “stealth” because the violations at the top and bottom make it difficult to see, and so no one sees it (I don’t see anyone suggesting it). So that counts in its favor. The more cunning the better.
I favor this until we go lower. Price needs to confirm and we need to move up. I’m not saying I want this just because I like being contrarian (though I do like that), but the evidence suggesting this drop isn’t real continues to mount, in my opinion.
The strength in JNK is relentless. Not only did it not give us a divergent high at the highs against SPX, now it’s one-upping that by giving us divergence at the lows here. While SPX destroyed this week’s earlier low, JNK hasn’t even really come close to making another low. So SPX lower low, JNK higher low, at these lows. We had no bearish divergence at the CPI high and we now have bullish divergence at this low. Big red flag in my opinion.
Retail is going full ham for a crash:
Sentiment generally is too poor for us being this close to a high:
So, price is King. We keep going down, that’ll be fine. But, there’s still enough here for the bulls to take over and they might and if they do it’s not going to be pretty and I would rather miss out on some decline rather than get trapped up in that in the wrong direction.
So, I’m still modestly long via futures (was very close to stopping out today, but we didn’t quite go low enough, so I’m still in those), and watching to see what happens.