It's hard to remember a time that I felt so disenchanted with the market. I enjoy charting, and I enjoy trading, but when the world seems turned upside down like it is, the whole affair loses its charm. Oil goes up? The market goes up. Oil goes down? The market goes up even more.
Of course, there's a lot more to the market than just oil. But the notion that there never was any recession, and that the so-called bear market had its entire run in the span of a few months, is becoming nauseating possible to believe. I never thought the government could bail out a market, but maybe it managed to do so. Or at least delay the day of reckoning.
When the IWM opened this morning, it was weaker, and it looked like it might be a nice down day. But it gathered strength soon after the open, and it never looked back. It didn't push past the Fibonacci retracement you see here, but it got awfully close.
Other major ETFs, though, like the QQQQ and SPY, blew right through their highs set earlier this week. The moment this line was crossed, you could see all the shorts diving for cover.
OIH is maddening. The yellow tinted areas show what had become daily swoons, but this thing just keeps powering higher. Most insane of all, crude oil (the commodity itself) actually got walloped today, but OIH blasted sky-high.
Here's the aforementioned crude oil price. This is the heftiest bearish engulfing pattern this market has seen in a while.
The $VIX now stands at less than half its level back in March. Are we going to return to the single digits? It's amazing how swiftly – – and consistently – – people are diving right back into this market.
If we back up to a daily chart on the S&P, we can see (for the bears) this very troubling fact: the market was range-bound until a few weeks ago. It pushed its way above the retracement line. It sank back down to touch it perfectly. And it resumed moving higher (to a new high price since the mini-bear market took place). It is seeming increasingly unlikely that we're going to break below the critical 1,383 level. Even with all this overhead supply, the market may simply climb the "wall of worry", slowly but surely.
And the Transports are even "worse." This index is only one good day away from a new lifetime high.
You can tell from my tone I'm feeling pretty miserable about the market. I can deal with markets, be they up or down, as long as they make some kind of sense to me. This one doesn't. So it's discouraging for someone who wants to analyze price action to be faced with what appear to me to be baffling contradictions. So I'm sorry I don't have anything more inspiring to say. See you Friday evening.
