As many eons as I’ve been doing this, I never lose my sense of wonder about charting. A great example this week was Abercrombie & Fitch, from which I garnered 240% gains on the puts. I dumped my position swiftly on Tuesday morning when it crashed, and I’m glad I did, because it exploded about 25% higher on Wednesday. But check out where the peak was………..precisely at the same price channel which it had broken with such drama! I find that absolutely remarkable. Once again, support became resistance.
Incidentally, I’d like to remind everyone that the rally we’ve seen this week is based upon the WORDS of two entities:
- Jamie Dimon;
- The Federal Reserve
Both of which are utterly objective observers of economic reality and have absolutely zero vested interest in supporting the asset markets.