The market is still in the throes of this unexpected (and, to me, inexplicable) Trump-gasm, but to my eyes are there far, far better opportunities on the short side of the market than the long. Here are 7 of my current 45 short positions that I’d like to share with you:
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It’s been a boring day, but what has been happening is that the triangle / bull pennant that broke up yesterday is doing the usual triangle sequence of backtesting the break before the triangle thrust up. After the triangle thrust up ends of course it’s then 90%+ probable that the thrust is fully retraced back to this backtest low.
So is the backtest finished? Maybe, though normally it would go a bit deeper. It may need a little lower before the triangle thrust begins. When the thrust does begin I’d be expecting to see at least a full retest of the all time high on SPX. ES Dec 60min chart:
Crude oil is acting picture-perfect. As I specifically mentioned Monday, I believed it might rally to the underbelly of its trendline, and this morning, with yet another goofy rumor from Russia, crude oil soared……….PERFECTLY touching its trendline, right to the pixel. Huzzah!
So I am VERY enthusiastic about shorting energy stocks at present levels (and, as a bonus, Gartman turned bullish on oil yesterday, God bless him).
by Avi Gilburt, ElliottWaveTrader.net
I look all around me, and those that were bullish have now turned bearish, and those that were bearish are now drooling and foaming at the mouth. What happened to all the bulls?
When everyone turns bearish, especially after an impulsive structure off the 2015 lows has completed, and starts looking to further lows in the complex, it means the time is approaching for a potential reversal. One of our astute members said “when fear of missing out turns into fear of being in, you know you’re close to a bottom!”
I have noted several times over the past weeks that the perfect bottoming set up would begin as the market recognizes a heads and shoulders pattern setting up in the GDX. And, many this past week were pointing to this “perfect” pattern, which they view as setting us up for new lows in the complex. In fact, it could be “too perfect” since the entire market seems to now be hyper-focused on how it is going to take us to lower lows.