I wanted to followup on my prior observations and how it played out. Here’s said followup. To wit:
The above is important to ponder because of this reasoning…
First: Although the “market” appeared to be following the assumed path discussed prior, following within the highlighted channel in text book form (see the perfect touch and reversal marked with “First…”). It ran completely out of steam and never gained a modicum of strength the moment the European markets closed at 11:30am ET.
Second: Due to the nature of what today represented (e.g., Month/Quarter end) it was striking just how exhausted or flaccid this touted “new bull market” petered out with barely a whimper into the close.
Third: It continued (as well as continues as I type this in the new overnight session) to fall ever further in the remaining 15 minutes of futures. Every-time I look up at the above all that comes to mind is the word: wilting. Usually a finish into this type of day has momentum one way or the other, not the obvious deflating appearance that it demonstrated today.
“So what does this mean?” I can hear you asking and it’s a good question, because this rather paltry showing of any remaining strength might just be the strongest clue for where it’s going in the very near future. i.e., Something wicked this way comes.
It’s very possible, as well as plausible, that all of the oomph that set into motion the myriad of so-called “smart-crowd” to run over their mothers as to get in front of the nearest camera, keyboard and microphone to signal some sort of “all clear,” was nothing more than the phenom of a very oversold market that met a bunch of front runners (aka “HFT parasitical bots”) to feast on the well publicized pension re-balancing that needed to take place over the past several days. In other words – the re-balancing was over as of yesterday, and today, it had to stand on its own – and it just folded out of both exhaustion, as well as no further need to buy/sell or balance.
If the above has any merit it doesn’t change any of my prior prognostications of where this “market” might be going or venturing next. As a matter of fact – it further enforces that opinion.
As always, we shall see.
© 2020 Mark St.Cyr