Stock Market Retracement High was Made... Prepare for What's NextStock-Markets / Stock Markets 2016 Mar 10, 2016 - 06:59 PM GMT
SPX clearly made a corrective high beneath Friday’s high before impulsively declining to its low at 1969.25. The 61.8% retracement is at 1991.39, where the bounce may be expected to go. We may see the ensuing decline begin in earnest either in the last hour of the day or overnight. Be Prepared.
VIX popped above the daily mid-Cycle resistance at 18.97. If is firmly in the “buy” camp. This is a confirmation of the SPX sell signal.
TNX is at the top of its Head & Shoulders neckline. So far this is a non-confirmation of the SPX sell signal. It appears to be clearly offering misinformation about the state of the market.
ZeroHedge reports, “Well we warned you. Bund yields were extremely optimistic about Draghis' bazooka.. and were disappointed.
As traders dumped their Bund bets so this has sent Treasury yields jumping to the highs of the day (compressing the UST-Bund spread by 12bps)...
as it appears Draghi has driven a great rotation (for now) into IG credit from Treasuries.”
The big move that took the air out of the SPX rally was the USD, which fell under 96.00. It is currently at 96.11, near the bottom of its decline.
ZeroHedge comments, “The last time that global liquidity conditions contracted at this pace was March 2008 (right as stocks dead-cat-bounced on the back of The Fed's guarantee of Bear Stearns' sale to JPMorgan)... and things escalated rather quickly thereafter.”
Prepare for a panic decline.
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