Today was another one of those highly suspicious trading sessions that smacked of possible market manipulation, by the PPT, the FED, or the cyberpunk buy-on-or-near-the-open-and-close lackeys of Wall Street, in conjunction with those that carry out and desire such manipulation for their own purposes.
The morning and early afternoon equity trading session on the NYSE and NASDAQ were clearly down for most of the day. Yet, just before 3:00 PM with about an hour to go - the market rallied sharply to close UP on the SP500.
So now what to do?
Well the best advice as always, is to trust no one and SPOT THE TREND on the charts. This also implies that you must match your personal time-frame for your desired trading or investing personality to the appropriate charts. While some invest for a four year time horizon, others prefer to trade every four days.
In short and frankly, I really do not have a great deal more to add than what I have already stated.
If you are new to this blog, go back and read some of my older posts. As I have been saying in clear terms, this exuberant and highly bullish market cycle is easily identifiable on longer-term weekly and daily charts - as very tired and near capitulation and a change in trend to down.
Consider that the SP500 market recovery after the justifiable sub-prime crash of 2008, is up about 100% and in less than two years. At minimum, we are overdue for a correction of at of least ten percent. That number of a ten percent correction could also be too conservative, and we could begin a far more formidable trend down. Even Tom De Mark - himself a known market wizard, and expert at statistical analysis has recently called for a similar change in trend - to down.
Therefore consider yourself warned not only by this blog, but also a well respected global market wizard.
In the very short term (a few days), the market will now be further tested tomorrow - at the key SP500 price level of 1292. This same price level has already been tested three times (all from below as a resistance level) in less than a week.
In essence, a failure tomorrow to break 1292, will imply a market capitulation and possibly abrupt change in trend to down is very near.
On the other hand, if those same cyber-bot manipulators as mentioned above, again manipulate the open tomorrow by yet another unexplainable opening GAP UP, it implies the SP500 could set another new marginal high and then test the key psychological level of 1300.
I close today's blog by saying again that this is not a market to trust. It is not a time for complacent or passive investing.
For traders, or those more short term focused, we still do not have an ideal entry or perfect set-up, given the sideways trend of recent days. That stated looking out shorter and medium term, I remain of the opinion that the current risk is high and the next big move or coming trend is down.
Those that are more aggressive swing traders, and whom can take on higher risks and enter trades before a trend fully emerges, should probably acknowledge and see this equity market has many sell-setups.
Spot the trend on the chart and go with it. Two chart exhibits are found below with my usual mark-up comments.
James Kelly Sr.,
Editor in Chief, BBTL Blog
www.KRTT.com
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