Turn Around Tuesday – S&P500 Futures Chart (SPY)
|5 min ES|
Again the day after after we make a new multi-month lows below 1200 we have one hell of a squeeze. 1200 being the line @ which the price must not close below, or we are being led to believe by Santa.
We all know the real story behind Santa and we all wish he were real.. but indeed he is a farce.
Does this mean this rally is a farce? no price still pays but you have to factor into your jubilant trigger finger…..when less participants are in the market prices become more volatile because there is less size on either side of the market. that is the the nut shell version why? because the media gives us everything in a nut shell anyway…
The squeeze trigger point for much of the short covering today was the break over 1214 about an hour before cash opened. You have a descending trend line converging with the apex of an ascending triangle, the machines love this.. and technicians. So you see what happened next. BOOM huge volume.. lots of shorts were stopped out as the downtrend line (grey dashed ) has been in place for about a week as the fall from 1260 commenced.
As far as currency’s go, you have the euro bidding and the dollar off in a equal amount, very tame mind you. Crude has flown off the rails again and overshot to the upside some 3.6% further decoupling itself from the movements of the equity markets. I mentioned last night in my evening note on crude that i felt the risk was ot the upside and 95 would be trading before today. Sure enough 95 traded, and so did 97.50. You got 2.5 extra point. Win win.
Gold as well as copper saw a rebound as well. Though what do you expect in a market tied together with hundreds of miss understood ETF’s.