Do Not Enter Longs: More Downside Coming to a Theater Near You
تم تحديثه
For those who have followed my ideas, I'm not "big" on shorting because in many cases its a gamble, risky, and you risk blowing your account. Sometimes you win big - and more often than not people get greedy and you end up losing all of your gains in subsequent days. However, In times of market distress where there's virtually nothing to invest in, it can make sense if you have a strategy and you are experienced enough.
Currently we are seeing essentially an unwarranted dead cat bounce as a result of Trump hyping up fiscal policy easing, however, that is likely a bounce that will end today, tonight, tomorrow or sometime this week.
The near-term end goal is that the SPX will fall to at-least the 2590-2620 depending on the steepness of the rate of decline. This level would likely act as a temporary bottom but probably not "the" bottom.
The ultimate question is: will there be enough negative news to form a 2018 December double bottom around 2320. The answer is: its very possible. Rapid coronavirus escalation in US cases, deteriorating consumer sentiment, and other unforeseen factors could push is to a double bottom. All of which are above chance rather than below.
There are several gaps down in the 2300s-2400s and its possible we now have the Black Swan to [finally] fill these.
- zSplit
TLDR
With Powell likely to cut at-least 50 bps next week this will push US Yields down to 0 on the 10 year and therefore your safest investment is the TMF or other forms on US/Canadian long-term bonds. When we reach 2590-2620 you can open small lots and once we reach 2320 which is more than likely in the coming months, one can open larger lots.
Currently we are seeing essentially an unwarranted dead cat bounce as a result of Trump hyping up fiscal policy easing, however, that is likely a bounce that will end today, tonight, tomorrow or sometime this week.
The near-term end goal is that the SPX will fall to at-least the 2590-2620 depending on the steepness of the rate of decline. This level would likely act as a temporary bottom but probably not "the" bottom.
The ultimate question is: will there be enough negative news to form a 2018 December double bottom around 2320. The answer is: its very possible. Rapid coronavirus escalation in US cases, deteriorating consumer sentiment, and other unforeseen factors could push is to a double bottom. All of which are above chance rather than below.
There are several gaps down in the 2300s-2400s and its possible we now have the Black Swan to [finally] fill these.
- zSplit
TLDR
With Powell likely to cut at-least 50 bps next week this will push US Yields down to 0 on the 10 year and therefore your safest investment is the TMF or other forms on US/Canadian long-term bonds. When we reach 2590-2620 you can open small lots and once we reach 2320 which is more than likely in the coming months, one can open larger lots.
تعليق
Something to remember --No rally will be sustained and "real" until:
1) US 10 Year stays above 1.000,
2) Crude maintains at-least a $45 handle,
3) VIX falls below 30 and stays below 30.
تعليق
Markets tanking as expected. Hide in shorts, non-leveraged and long-term bonds, non-leveraged Gold bullion (not miners) and most importantly, cash.First TP at 2590-2620 remains (based on the steep rate of decline, first TP is more like 2590-2600).
Second TP (which I put a 65-70% on) is December 2018 lows and closing the plethora of gaps in the 2300-2400s. This would take us down to the 2320-2340ish level.
With now the WHO now claiming this officially a "pandemic" this could be the driver to push us down even further.
DO NOT fall for any snap-backs. Huge snap-backs only happen in bear markets.
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