While this looks like a top, and the price has come down from 500 to 171, two longer moving averages are still trending upward.
The problem for HODLers is that the first MA is at 117, and the second is at 57.
As I explained here, we’re in a liquidity shortage, but one that will be lessened over the rest of this month.
As liquidity ebbs and flows, we’ll see wild volatility changes over the next 3-6 months.
This morning, it’s to the upside, but …
It’s a reverse Hotel California. You can leave, but you can never check in.
He who shorts what isn’t his’n must buy it back or go to prison.
Today is Fed Circus. The elephant parade.
What can we learn from this lesson in financial zoology?
However, my guess on the 5 day cycle projection is 3865.
As of 4:45 AM ET, the ES fucutures are pulling back from a high of about 3852, heading for multiple support lines around 3839+40. I imagine we’ll get a bounce from there. If it doesn’t, or if it’s weak, the next target would be around 3824-25.
The widely accepted Wall Street conventional wisdom is that the market discounts the future.
Please disabuse yourself of that stupidity.
The market kept accelerating out of trend channels yesterday. That’s crash behavior. In this case, a crash-up.
3815 around 1 PM ET.
At least that’s the 5 day cycle projection. For the big picture, see
The Composite Liquidity Indicator (CLI) Says Honor Thy Father and Thy Mother
Lots of Signals, Mostly Sells, Means Good Shorts Ahead