Market Crash - ES Ascending Wedge Breakout
So everything went almost exactly as I expected today, but there was a big problem, no sell off and no life for VX. Going into the day I wasn't sure about CPI but figured a hot or cool reading would get a reaction, but didn't expect that big of a rally off of a 0.01% cool print which was mostly as expected.
After CPI release, fed fund futures priced in a 75% chance of a cut in September. I thought this was crazy,.no way they are cutting in September. They never had plans to cut in September unless data changed significantly, which it didn't and today's CPI was not going to change their target rate. The expectation dropped to around 60% before the minutes were released, but was still pricing in way too high of a chance. When I saw this, I thought oh yeah this is the classic bull trap. Everything looks.great but after FOMC when the market realizes it's not getting a September cut, there will be a dump.
Sure enough the minutes are released and there's no September cut. However, the market held up most of the day and had a small pullback before close. I couldn't believe it honestly, VX just didn't get any life whatsoever despite the market not getting what it wanted, which usually leads to panic in my experience. Then AVGO announced a stock split and NQ pumped even more after hours.
So here we are, the market didn't get 2 cuts but doesn't seem to care. However, DXY is showing a lot of strength in the overnight session and assets like BTC and Silver are struggling, which would point to weaker equities. The was weak today and RTY gave up a lot of gains after a strong morning. ES and NQ still remain strong. I fully expect this to end badly because the market was wrong and that is always bad. We should see a bigger reaction soon, once everything settles down. Many things I'm seeing today I would interpret as bearish, but VX just keeps going down and NQ keeps going up.
This is part of being a bear unfortunately,. you're unlikely to pick the top perfectly,.so if you decide to short a seemingly strong market at ATH, you'll probably lose most of the time. I still fully expect the market to run out of steam and keep seeing more and more top signals. However,.it's gonna go up until it stops and if you choose to short it, you've got to be a bit lucky or remain patient. I'm remaining patient, we'll see what tomorrow brings. The sell is coming.
After CPI release, fed fund futures priced in a 75% chance of a cut in September. I thought this was crazy,.no way they are cutting in September. They never had plans to cut in September unless data changed significantly, which it didn't and today's CPI was not going to change their target rate. The expectation dropped to around 60% before the minutes were released, but was still pricing in way too high of a chance. When I saw this, I thought oh yeah this is the classic bull trap. Everything looks.great but after FOMC when the market realizes it's not getting a September cut, there will be a dump.
Sure enough the minutes are released and there's no September cut. However, the market held up most of the day and had a small pullback before close. I couldn't believe it honestly, VX just didn't get any life whatsoever despite the market not getting what it wanted, which usually leads to panic in my experience. Then AVGO announced a stock split and NQ pumped even more after hours.
So here we are, the market didn't get 2 cuts but doesn't seem to care. However, DXY is showing a lot of strength in the overnight session and assets like BTC and Silver are struggling, which would point to weaker equities. The was weak today and RTY gave up a lot of gains after a strong morning. ES and NQ still remain strong. I fully expect this to end badly because the market was wrong and that is always bad. We should see a bigger reaction soon, once everything settles down. Many things I'm seeing today I would interpret as bearish, but VX just keeps going down and NQ keeps going up.
This is part of being a bear unfortunately,. you're unlikely to pick the top perfectly,.so if you decide to short a seemingly strong market at ATH, you'll probably lose most of the time. I still fully expect the market to run out of steam and keep seeing more and more top signals. However,.it's gonna go up until it stops and if you choose to short it, you've got to be a bit lucky or remain patient. I'm remaining patient, we'll see what tomorrow brings. The sell is coming.
