As always for those wondering what I’m currently watching, looking for clues, below are a few charts which currently have my attention. To wit:
The above represents the S&P 500™ Futures via hourly candles/bars. The reason the above has my attention is, via my technical eye, the last few days of rally are beginning to show themselves as what I’ve believed it was. e.g., a relief rally from oversold conditions. Not the start of another BTFD (buy the f’n dip) bonanza that has been shouted across every business/financial media outlet via one next-in-rotation fund-manager after the other.
The issue here is that if I’m correct (or even close) in what I’m inferring, then we may very well be on the cusp of another sudden violent move lower, out-of-the-blue.
In other words when it happens it may just happen for reasons one may not put an exact finger on. i.e., there are too many simultaneous happenings once again in the forms of headline and/or event risk that any one of them could set things off.
Will it happen? Who knows, however, what is of great importance is understanding that the conditions for such seem ripe. And not just “ripe,” but over-ripe meaning, the timing for such is at hand. i.e., not weeks or months, but more like any day. And yes, maybe even today.
So here’s my focal points:
Should the S&P 500 travel up and beyond the 2600 and remain there my outlook would warrant a reassessment. If it gets up there and is soundly rejected and begins to fall back lower, then a quick revisit to lows of December are on the table.
Should the lows of December (e.g., 2300 thereabout) not hold and the fall continue with any follow through (i.e., observable panic selling) then the chart below shows where I believe we may end up quickly. Again, to wit:
Does it mean it will happen? Again, no one knows. But then again, when I made the same arguments for December’s sell off that was dismissed as “Crazy talk!” And then it happened.
As always, we shall see.
© 2019 Mark St.Cyr