Couldn’t Find The Rally Button Either
A rather disappointing start to the week; even the “Lemmings in Asia” [LIA] did what I wanted. Seems the marching turtles couldn’t find the rally button.
The algorithm had 5 buy signals today; the first few came in the Asian session and allowed me to set up “free trades”. Unfortunately, the small rallies couldn’t hold and the market moved lower for most of the day.
I was somewhat surprised of 2 things today; 1) no attempt on the highs after the open, and 2) the depth of the decline to the 1692 level. Deflationary forces, early dollar strength, and a general “risk off” attitude today towards the metals, and you have the “$10 flying wedge of death” chart pattern in the U.S. session.
The range was decent but once the U.S. session opened there wasn’t much left of the bull case for the day. Are we gonna have 2 back-to-back huge reversal days? We did get a $10 rally off the low, but like recent days it came so fast it left the algorithm lagging on the buy signal.
This is the kind of day that leaves both bulls and bears somewhat happy. For the bears, there was no follow through of Friday’s massive reversal. For the bulls, the sell off got rid of weak longs and the market still looks set to close the day above 1700.
So far, it looks like the market is congesting the massive sell off we saw on February 29, backing and filling and trying to find a level from which the bull case can resume. Before we can get back above the 1725 – 1750 level, the market is going to need some more time.
Have a good day everyone.
-vegas
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