Here’s a weekly chart of the S&P 500 over the past 15 months. Perfectly normal.
When we look at the hourly bars, we almost get the idea that it’s a normal market that goes down as well as up.
But we know that it’s not. The 5 day cycle projection now looks around 4405. The Dealers shook the tree on Friday and Monday to cover their shorts and pick up some low hanging fruit inventory for the current runup.
If they break through 4483, then the current pattern would have a conventional measured move target of 4540 or fight.
Fed MBS settlement week is now done. The Fed pumped $123 billion into dealer trading accounts. I suspect that most of that cash has been spent. The Treasury pumped in another $40 billion in T-bill paydowns on Tuesday, with another $8 billion on the way today. “Only” $8 billion.
The debt ceiling comes back on 7/31. Watch out for that. https://liquiditytrader.com/index.php/2021/07/19/heres-what-the-treasury-buying-stampede-really-means/
Meanwhile, as for the longer term stock market technical outlook – Here’s What Friday’s Selloff Means for Our Future
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