The Last Supper, 10 Feb 2023
🖼 Daily Technical Picture 📈
➤ I’m no Trading God, but was today’s price action the Last Supper for the Bulls? Is the free flow of sweet wine about to be cut-off? Not sure if this reference was blasphemous, I plead for mercy.
➤ Equities opened the trading day aggressively higher but by the end of day it was a complete 180° reversal of fortune. What do I make of this?
➤ Clearly, the Bears would be encouraged by today's price action. Price has definitively closed back below the resistance zone. VIX has responded by moving back above 20 from where previous downtrends began in ernest.
➤ The only wrinkle and it may be a very short-term one is that the drop from the recent high is not a change in behaviour. i.e. this drop is nothing out of the ordinary. The two key observations for a change of behaviour are:
➊ out-sized bearish candle/bar or
➋ out-sized drop since the beginning of the intermediate bull trend (since Jan 2023 low)
❌ Neither of these has occurred (when comparing to the drop on 18th Jan). Of course, we just need another bearish day and we will easily fulfill observation ➋
➤ NOTE: A change of behaviour does not mean a trend has ended. It is only a warning sign (the amber coloured traffic light) that something is afoot.
➤ I still hold a small short position.
➤ Conclusion: Plenty of Bulls are drunk, tell them not to drive [A public service announcement] - translation: just be careful
➤ I’m no Trading God, but was today’s price action the Last Supper for the Bulls? Is the free flow of sweet wine about to be cut-off? Not sure if this reference was blasphemous, I plead for mercy.
➤ Equities opened the trading day aggressively higher but by the end of day it was a complete 180° reversal of fortune. What do I make of this?
➤ Clearly, the Bears would be encouraged by today's price action. Price has definitively closed back below the resistance zone. VIX has responded by moving back above 20 from where previous downtrends began in ernest.
➤ The only wrinkle and it may be a very short-term one is that the drop from the recent high is not a change in behaviour. i.e. this drop is nothing out of the ordinary. The two key observations for a change of behaviour are:
➊ out-sized bearish candle/bar or
➋ out-sized drop since the beginning of the intermediate bull trend (since Jan 2023 low)
❌ Neither of these has occurred (when comparing to the drop on 18th Jan). Of course, we just need another bearish day and we will easily fulfill observation ➋
➤ NOTE: A change of behaviour does not mean a trend has ended. It is only a warning sign (the amber coloured traffic light) that something is afoot.
➤ I still hold a small short position.
➤ Conclusion: Plenty of Bulls are drunk, tell them not to drive [A public service announcement] - translation: just be careful
🏆 eToro Popular Investor 💰
✅ Copy My Trades @ eToro, etoro.com/people/mrstocky
✅ Verified Track Record 📈
Not Investment Advice
✅ Copy My Trades @ eToro, etoro.com/people/mrstocky
✅ Verified Track Record 📈
Not Investment Advice
Declinazione di responsabilità
Le informazioni ed i contenuti pubblicati non costituiscono in alcun modo una sollecitazione ad investire o ad operare nei mercati finanziari. Non sono inoltre fornite o supportate da TradingView. Maggiori dettagli nelle Condizioni d'uso.