Posting this one early today because there's no point is watching till close.
We all know the market is manipulated, but when it's THIS obvious it bothers me. Just a week or two ago i ranted a little about how we're seeing capitalism as we know it and the free market essentially die at our feet while we see the proliferation of corporate socialism in our "free market"
Why am i bringing this up again? Well just in case you live under a rock:
"Under the latest guidelines, the Fed said it will buy, on the secondary market, individual bonds that have remaining maturities of five years or less. Those purchases will go along with the ETFs the Fed already has been buying, which are balanced toward investment-grade indexes but also include some junk bond funds that track debt which had been investment grade before the crisis but had been downgraded after.
The intent of the individual debt purchases will be “to create a corporate bond portfolio that is based on a broad, diversified market index of U.S. corporate bonds,” the Fed said in a news release.
“This index is made up of all the bonds in the secondary market that have been issued by U.S. companies that satisfy the facility’s minimum rating, maximum maturity, and other criteria. This indexing approach will complement the facility’s current purchases of exchange-traded funds,” the statement said."
www.cnbc.com/2020/06...corporate-bonds.html
This means they'll be directly buying corporate debt in the secondary market competing with normal buyers. Bidding up and tightening spreads. They'll also be directly buying from bond issuers through other means as well. Corporate. Socialism. The free market as i understand it is not that free at all anymore, and getting less free the further we get into 2020.
This essentially backstops companies who were in dire financial straights for whatever reason for an undetermined amount of time. In effect nationalizing some of these companies debt (in my opinion). Just like China, just like Japan. Next up? Mark my words. If we have another sharp/deep downtrun in equities (let's say around 1500-1250 in SPX) they will start directly buying equities, just like the EU. Which is a perfect segue.
Why this news now? Why not last week during the fed meeting? I mean, i'm usually joking when i say on the direction of commisar Jpow that corrections and pullbacks are illegal, and recessions punishable by death. But, this is just comical at this point. So, why now? Why right now? Well, one theory i have is that they're frontrunning something. They see something we don't and they're trying to pad this upcoming move by fluffing the corporate debt of whoever so when this next down move does come it won't be as sharp. The question is what is it? Incoming deteriorating econ data? Do they have some model predicting another economic shutdown due to the virus? This is weird that they choose just now. Today. To release this. What is the Fed still afraid of? What are they prepping for?
This bothers me alot for the obvious reasons. But mainly because sometimes it truly makes this market untradable from a tecnical, and now even fundamental perspective. How do you trade this?
Technically today was boring, like paint dry boring. Until comrade Jpow interfered. We opened up lower and had a low volume algo pump back to fill the gap. There was little to no institutional participation until the fed news. Half of me thinks the chart is telling me we're bottoming. The other half is telling me we're bear flagging for another move lower. I honestly don't know. And with that we're getting the fed news faded currently which further adds to the 50/50 probability.
Bull case: We entered the demand zone in and around the $294-$300 price area and we retraced almost immediately. That was some of the only meaningful volume we had all day was the first hourly candle this morning. With that there were also no sellers today. It's almost as if big money took a long weekend. But, RSI has been starting to show bullish RSI divergenes on most timefranes. We also opened below, and regained the daily 200 period MA. Pair that with any type of positive news on top of the fed news today we could print a reversal here in next day or two for a counter trend rally. There's also a horrible looking modified cup and handle on the 5 min i'll show below.
But It's like we got down to the $300 area and people lost interest.
Bear case: This is just one big bear flag. We're consolidating and equalizing after that violent down move we had last Thursday while big money is in wait and see mode and generally been fading any pops. We've failed to get anywhere near the .5 fib from the drop on Thursday and it seems like any movement upward is simply because there's no sellers until we get to a certain point (resistance). Generally island reversals like the one we had last week is a pretty bearish pattern and tends to follow through.
5m showing what could, maybe, be a modified cup and handle
Hourly showing consolidation. But if we close above $305.87 that's bullish
With bullish divergences
Look at the 4h
Daily showing it trying to close above what was resistance at $305.87, and above the 200 period MA
We did get rejected from resistance at $3080 though
Look at SPX daily. It has to fight that uptrend from last summer/fall lows again
ES hourly looks bullish
ES daily finding support on the .5 fib from the beginning of our last run towards the highs. Probable reversal
Leading indicator, IWM going for the gap already
But, this doesn't look too healthy just yet on the daily
VIX filling it's own gap it printed day. Not quite a reversal just yet in my opinion
DJI consolidating. Support on 100 period MA
NDX also not looking particularly healthy but back above support
XLF back above it's consolidation zone but just like IWM daily looking like a consolidation/bear flag
Same with DJT
Again metals are correlating with equities, not ok
Silver looking like it could be a pretty decent short
Gold's going to have a big move here in the next couple weeks. But again, correlating with equitie movements
Bonds looking like their bull flagging
I said last night buckle up for volatility, and here we are. Even with the fed news we had a low volume pump today. Jpow is making it almost impossible to chart some of these moves (which isn't new). The question is what are they afraid of and where is it going to send us.
Hope everyone had a good day trading. As always keep your head on a swivel and happy trading.
This is not trading advice. This is my own personal opinion based on my own personal TA.
We all know the market is manipulated, but when it's THIS obvious it bothers me. Just a week or two ago i ranted a little about how we're seeing capitalism as we know it and the free market essentially die at our feet while we see the proliferation of corporate socialism in our "free market"
Why am i bringing this up again? Well just in case you live under a rock:
"Under the latest guidelines, the Fed said it will buy, on the secondary market, individual bonds that have remaining maturities of five years or less. Those purchases will go along with the ETFs the Fed already has been buying, which are balanced toward investment-grade indexes but also include some junk bond funds that track debt which had been investment grade before the crisis but had been downgraded after.
The intent of the individual debt purchases will be “to create a corporate bond portfolio that is based on a broad, diversified market index of U.S. corporate bonds,” the Fed said in a news release.
“This index is made up of all the bonds in the secondary market that have been issued by U.S. companies that satisfy the facility’s minimum rating, maximum maturity, and other criteria. This indexing approach will complement the facility’s current purchases of exchange-traded funds,” the statement said."
www.cnbc.com/2020/06...corporate-bonds.html
This means they'll be directly buying corporate debt in the secondary market competing with normal buyers. Bidding up and tightening spreads. They'll also be directly buying from bond issuers through other means as well. Corporate. Socialism. The free market as i understand it is not that free at all anymore, and getting less free the further we get into 2020.
This essentially backstops companies who were in dire financial straights for whatever reason for an undetermined amount of time. In effect nationalizing some of these companies debt (in my opinion). Just like China, just like Japan. Next up? Mark my words. If we have another sharp/deep downtrun in equities (let's say around 1500-1250 in SPX) they will start directly buying equities, just like the EU. Which is a perfect segue.
Why this news now? Why not last week during the fed meeting? I mean, i'm usually joking when i say on the direction of commisar Jpow that corrections and pullbacks are illegal, and recessions punishable by death. But, this is just comical at this point. So, why now? Why right now? Well, one theory i have is that they're frontrunning something. They see something we don't and they're trying to pad this upcoming move by fluffing the corporate debt of whoever so when this next down move does come it won't be as sharp. The question is what is it? Incoming deteriorating econ data? Do they have some model predicting another economic shutdown due to the virus? This is weird that they choose just now. Today. To release this. What is the Fed still afraid of? What are they prepping for?
This bothers me alot for the obvious reasons. But mainly because sometimes it truly makes this market untradable from a tecnical, and now even fundamental perspective. How do you trade this?
Technically today was boring, like paint dry boring. Until comrade Jpow interfered. We opened up lower and had a low volume algo pump back to fill the gap. There was little to no institutional participation until the fed news. Half of me thinks the chart is telling me we're bottoming. The other half is telling me we're bear flagging for another move lower. I honestly don't know. And with that we're getting the fed news faded currently which further adds to the 50/50 probability.
Bull case: We entered the demand zone in and around the $294-$300 price area and we retraced almost immediately. That was some of the only meaningful volume we had all day was the first hourly candle this morning. With that there were also no sellers today. It's almost as if big money took a long weekend. But, RSI has been starting to show bullish RSI divergenes on most timefranes. We also opened below, and regained the daily 200 period MA. Pair that with any type of positive news on top of the fed news today we could print a reversal here in next day or two for a counter trend rally. There's also a horrible looking modified cup and handle on the 5 min i'll show below.
But It's like we got down to the $300 area and people lost interest.
Bear case: This is just one big bear flag. We're consolidating and equalizing after that violent down move we had last Thursday while big money is in wait and see mode and generally been fading any pops. We've failed to get anywhere near the .5 fib from the drop on Thursday and it seems like any movement upward is simply because there's no sellers until we get to a certain point (resistance). Generally island reversals like the one we had last week is a pretty bearish pattern and tends to follow through.
5m showing what could, maybe, be a modified cup and handle
Hourly showing consolidation. But if we close above $305.87 that's bullish
With bullish divergences
Look at the 4h
Daily showing it trying to close above what was resistance at $305.87, and above the 200 period MA
We did get rejected from resistance at $3080 though
Look at SPX daily. It has to fight that uptrend from last summer/fall lows again
ES hourly looks bullish
ES daily finding support on the .5 fib from the beginning of our last run towards the highs. Probable reversal
Leading indicator, IWM going for the gap already
But, this doesn't look too healthy just yet on the daily
VIX filling it's own gap it printed day. Not quite a reversal just yet in my opinion
DJI consolidating. Support on 100 period MA
NDX also not looking particularly healthy but back above support
XLF back above it's consolidation zone but just like IWM daily looking like a consolidation/bear flag
Same with DJT
Again metals are correlating with equities, not ok
Silver looking like it could be a pretty decent short
Gold's going to have a big move here in the next couple weeks. But again, correlating with equitie movements
Bonds looking like their bull flagging
I said last night buckle up for volatility, and here we are. Even with the fed news we had a low volume pump today. Jpow is making it almost impossible to chart some of these moves (which isn't new). The question is what are they afraid of and where is it going to send us.
Hope everyone had a good day trading. As always keep your head on a swivel and happy trading.
This is not trading advice. This is my own personal opinion based on my own personal TA.
Comentarios:
Keep in mind futures and pre market is overbought already with a 75 to 80 reading on RSI already. If we do shake that off throughout the day watch for the normalization.
If we do gap and start to fill the gap we're about to print the target would be the bottom of the gap, i would look for an entry if we do make it back down that way.
If we do gap and start to fill the gap we're about to print the target would be the bottom of the gap, i would look for an entry if we do make it back down that way.
Comentarios:
I also have $315.14 as a support/resistance. We gapped up over it the last time we were up here. Keep your eye on it.
Comentarios:
If we bust this we're going for the gap fill.
Comentarios:
Tried to fill the gap. Bullishly traded away from it before we got there. Look where they just finished that last hourly too. Rescue op.
Futures are up 90 points...
Just like we opened up in the demand zone yesterday, we're going to be opening in the distribution zone today (buckle up). We'll see if this momentum lasts during the day. Targets to the upside are already hit really, which was the top of the breakdown candle at $311, we're going to be opening in the gap from Thursday. Targets past that would be the bottom of the gap at $319 even.