Ever since last week, the market has been slicing the heads off bears left and right, with the Dow up thousands of points and the ES up about three hundred .It’s been unrelenting.
Looming Ceilings
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.
Holiday Rally Setup
SPX closed below the main SPX support/resistance trendline at the end of last week. This trendline has broken twice since 2009, and both times SPX followed through hard. In 2011 SPX broke very hard through it and never broke back over it until until 2020. In 2020 SPX broke over it, then closed the next week back below, and then didn’t close back below it again until last week. This is too limited a sample to extrapolate much from but there is precedent for failing to confirm the break the following week and then following through the break and so the likely weekly close back above today has precedent from 2020 and is not an obviously bullish development.
(more…)One Headline, Why Believe It?
OK, look. I can play the hero now and then. Or at least be a stalwart example in the face of adversity. But this is starting to get annoying.
Monday was a bad day. I stood fast in the face of it. Every morsel of cash lost on Monday can tumbling back on Tuesday. Huzzah.
Wednesday started off nice and red. Nothing dramatic, but red nonetheless. And yet the market rallied, going into turbocharge mode when they interpreted the (meaningless) Fed minutes to state that the Fed will inch up rates a mere 1.5% more and then be done with it. So stock traders gobbled up the ostensibly good news.
(more…)Steady Freddy
Quite the grind, isn’t it? For the past couple of weeks, the stock market has been duking it out, between the bulls and bears, and no one seems particularly in control. On the /ES, for example, you can see how the bulls tried, for the umpteenth time, to break us above resistance, and they couldn’t even muster the failed breakout zone from the day prior. It all feels very range-bound, as rationality (the bears) keeps contending with the Fed. I would remind you, incidentally, they haven’t even started the first PENNY of quantitative tightening, and we’re already down this hard.
SPX Breaks Main Support Trendline
I was disappointed to see SPX close well below the main support and resistance trendline on Friday (Editor’s Note: Why? Why on Earth?) . This has only happened twice since the start of 2009, and on both occasions SPX followed through the break with force. Two instances is somewhat less than a statistically significant sample, but further downside is now undoubtedly open, even if the bull flag setups on many indices, sector ETFs and stocks are still intact.
SPX weekly chart:
