S&P Bear Trap Risk

This is a bit of a quickpost because the main thesis, that the S&P 500 is in a bear trap, seems pretty apparent from a charting approach. The price action to negate the theory is pretty simple as well, if price action gets back on that purple trend line and above the 2 fib level the bull trap is defeated. Instead I am going to look at some long term targeting for bounces or consolidations.

If we want to look at volatility based price channels the base of the keltner monthly keltner has been a good buy since 2011 and that low is more than 16% away 3850-ish. The C19 dump had price action wick to the base of the keltner and the dump in december 2018 as well. Great place for investing in uptrend. The other long term volatility based channel I am going to look at in the chart below is the monthly Gaussian channel. The C19 dump took price action into the channel and it was again a great place to invest or trade to the upside.

If this is going to be as bad as mega bears suppose then we have to take a look at the quarterly/3 month chart as well. Want a absolutely fantastic place to buy? Just watch this chart for once in a trading lifetime opportunity. If this chart history is any use, first we bounce off the quarterly keltner channel then have another low a few years later when the Gaussian channel catches up.

Here is a look at the quarterly Exponential moving averages. It seems pretty likely that we could hit the 48 some time soon and even a touch of the 100 isn't inconceivable. If price gets to the 200 EMA then the idea of investing gets really tricky, you don't even know what countries would survive that kind of dip, much less indivdual companies.

Why the mega- bearish forecasting? Lots of reasons, but simply take a look at the Nasdaq/S&P500 like it was a forex pair. Looks really bad.

What am I doing
Actually very little. I have taken most of my monies and put them into stable funds. I think interest rates are going to be jacked up pretty severely and so I have some investments that should do well in a high interest rate environment (just have to be patient). I am taking some play money and shorting whatever looks technically weak in crypto. With monthly and weekly weakness I short the breakdown of daily uptrend and trendlines looking for reversals.

Linked Ideas
Basically more macro-bearishness ideas for you to enjoy.

Comentarios:

Ok, SPX is down some 10% after my post and it seems that my call was good. I still see further downside based on the charts alone. You may not believe me, but to my in person associates I have been telling people the charts are so bad for equities that I expect something extreme as a war to kick off. We might be in the beginning stages of that.

Comentarios:

Just go to the main chart and hit the play button.