I’d say a big risk for the bears right now is the prospect of the emerging markets bouncing off their major Fibonacci Retracement levels. I don’t WANT this to happen, but I’m guessing the market doesn’t care.
Emerging Bounce?
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Nothing But Imports
When I was a kid, I vaguely remember on the nightly news they would talk about the trade imbalance. The idea at that time was, gasp, how could the American powerhouse of manufacturing actually send OUT more stuff than it takes IN? So the desire was to have a trade surplus.
Well, let’s just say those days are long gone. The imbalance is absolutely eye-popping:
By the way, this is little more than a comment cleaner. For what it’s worth, the ONLY thing I’ve done today is sold my June puts, for NO OTHER reason than to reduce time risk. It’s stupid, but it helps me psychologically. All my other positions are intact, with the CLOSEST option a delicious 70 days away.
Head Shrinker
As I’m typing this, the jobs report came out about half an hour ago. I woke up a little before the report was released, and since that time, it seems to me the four has gone through four psychological stages:
Anticipation: ES down about 15 points. The market’s inner voice: “Gosh, I’m worried about these numbers. Yesterday was a really rough day. Maybe these numbers will give the market a chance to rally from these deeply-oversold levels.”
Indecision: ES up about 3 points. The market’s inner voice: “Hmm, these numbers are a mixed bag. There is really strong jobs growth, which lets the Fed keep cranking up rates, but it’s really hard to figure out.”
Relief: ES up about 10 points. The market’s inner voice: “Ya know what, this is good news after all! I mean, look at this wage growth! It’s only 0.3% instead of the expected 0.4%. Hey, maybe it’ll be a good day!”
Epiphany: ES down about 40 points. The market’s inner voice: “Who am I kidding? What goddamned difference does a tenth of a point in a single highly-manipulated report mean? This market is completely doomed, and being wet-nursed for the past thirteen years has made me soft, weak, and insipid. I’m a bad person. I don’t deserve to live. I hope I get trapped in an elevator with Jim Cramer, and the elevator’s cable breaks, and we ae falling to our deaths, and in our final moments, he confesses his love for me, forcing a tongue kiss, which compels me to kill myself even though the elevator will do it in just another few moments.”
OK, maybe I’m reading too much into that last one, but I’m pretty sure that’s what the market is thinking.
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