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It’s very, very easy – effortless, actually – to be a bear on a day like Tuesday when the Dow closed down nearly 500 points. Days like that are a kick, and one Sloper pointed out something that hadn’t even occurred to me (even though he was mentioning a part of my personal history): that September 1 2015 was my best day ever, while September 1 2010 was my worst day ever. So – – at least 9/1 doesn’t have a completely awful meaning for me anymore!
Being a bear last Friday is a lot tougher, because the market is roaring higher, and it’s very easy to let six years of bear torture push one to paralysis. However, I shorted all kinds of tickers late last week, and they started to behave themselves Monday and really blossomed (or wilted, as the case may be) yesterday. Of course, today (Wednesday) is more akin to late last week – – – everyone is buying like mad, driven principally by the federal statute that decrees the market must be the exact opposite of whatever Gartman predicts.
It seemed that the elements were in place for a contrarian rally if not bull market bottom. Along with negative gold items routinely appearing in the financial media and a Commitment of Traders structure that had become very bullish, gold sentiment was bleak by indicators we track in NFTRH.
My how a 6% rally with an accompanying stock market down spike have changed things…
SPX made my double top target yesterday, overshooting by just a few ticks before bouncing hard overnight. There are two clear options here, both ultimately bearish, and we should see which option we will be taking today.
The more bearish and more likely option in my view is a rally backtest of 1950 area resistance. the key resistance levels here are the 50 hour MA at 1944, declining resistance from 2096, currently in the 1955-60 area, and (daily closing basis) the 5 day MA, which closed yesterday at 1960. as long as these can hold as resistance then I’ll be looking for the next move to be the retest of the October low in the 1820 area.