The market has settled into one of those maddening, boring trading ranges that don’t tell us anything. It has lasted 6 trading sessions, starting from before the holiday weekend. At the moment the range is defined as 4074-4190 on the ES 24 hour S&P fuguetures. That high is a bit lower than the high of 4202 as the range was starting to form, so bears can hang their hat on that. But bulls have the double bottom at 4073.9, with the second low 0.2 higher.
Those tiny differences actually matter. They usually serve as signals that the direction is sustainable in a time frame consistent with the duration of the low. The lows were about a day apart. The two highs are 4 days apart. Advantage, bears.
But until the range breaks, we wait. Patiently or impatiently. That’s your choice. I choose patience. Let the market do its thing. It will come to us eventually and give us a trend move that we can jump on.
Now, does the ES need to break out of the range for us to pay attention? Not necessarily. On the upside yes. But on the downside, if it traverses more than half, say getting below 4130, then I’ll get my bear suit from the dry cleaner and have it ready to wear.
Meanwhile, the 10 year yield hasn’t broken out yet, but it’s close. It needs to clear 2.951.
Meanwhile, we don’t need Fedheads to tell us what they’re going to do with ratifying rate moves in the market. It has no choice but to follow the market. And the 13 week T-bill shows us very well the supply/demand imbalance in the money a
For the big picture:
- NEW The US Economy, Including Jobs, Collapsed in May June 2, 2022
- Quantitative Tightening is Here, and the Effect Will Be Devastating June 1, 2022
- A Great Week for Swing Trade Screen Picks May 31, 2022
- Shot from Guns, This Market Looks Like Puffed Rice May 30, 2022
- We Hold Our Gold Miners, Add Another May 24, 2022
- Even Steven in This Week’s Swing Trade Screens May 23, 2022
- Stocks Are Ahead of the Curve May 23, 2022
- Dealer Positions Show It’s Not Getting Better and It Should Get Worse May 15, 2022
If you’re serious about the underlying forces of supply and demand that drive the markets, join me!
If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam filter.
