Most Popular
1. Dow Max Drawdown Bear Stock Market 2022 - Accumulating Deviations from the Highs - 21st Feb 22
2.Putin Starts WW3 in Ukraine, Will Use Tactical Nuclear Weapons, China Prepares Taiwan Blitzkrieg - 28th Feb 22
3.World War 3 Phase 1 - Putin WINS Ukraine War! - 25th Feb 22
4.INVESTORS SEDUCED by CNBC and the STOCK CHARTS COMPLETELY MISS the BIG PICTURE! - 10th Feb 22
5.Will There Be A 2024 US Presidential Election? - 3rd Mar 22
6.Gold and SIlver, Precious Metals Sector Is at a Terrific Buy Spot - 6th Feb 22
7.Why Putin Wants the WHOLE of Ukraine - World War 3 Untended Consequences - 6th Feb 22
8.Dow Stock Market Expected Max Drawdown 2022 - 19th Feb 22
9.Stock Market Calm In the Eye of the Inflation Storm - 4th Mar 22
10.M = F - Everything is Waving! Stock Market Forward Guidance - 7th Mar 22
Last 7 days
Why Ray Dalio is WRONG About China - Principles for Dealing with the Changing World Order - 24th May 22
Globalists Convene to Plan Central Bank Digital Currencies - 24th May 22
After Recent Highs, What’s Next for the Gold Junior Miners? - 24th May 22
Why APPLE Could CRASH the Stock Market! - 21st May 22
Why Is Crude Oil Ignoring US Inventories? - 21st May 22
Here is Why I’m Still Bullish on Gold Mining Stocks - 21st May 22
THE INFLATION MEGA-TREND QE4EVER! - 20th May 22
US Real Estate Investors – Is There An End In Sight? - 20th May 22
How Technology Affected the Gaming Industry - 20th May 22
How To Set And Achieve Reasonable Goals For Your Company - 20th May 22
How Low Could the Amazon (AMZN) Stock Price Fall? - 19th May 22
Bitten by FANG? Clocked by Cryptos? -- 'Air Pockets' Everywhere - 19th May 22
Northern General Hospital Orthopedics Fractures and and Ankle Clinic Consultations Real Patient Experience - 19th May 22
Cathie Wood Goes All in on Teladoc, ARKK INSANE Noob Investing Strategy! - 17th May 22
This is Anything but Positive for US Housing Market - 17th May 22
What Should We Do If There Is No Fed Monetary Policy Pivot? - 17th May 22
All Possible Ways to Earn Free Litecoin - 17th May 22
How low Could the Amazon Stock Price Fall? - 16th May 22
Cathy Wood ARKK INSANITY There is NO Coming Back! - 16th May 22
NASDAQ 100 Stock Market LOWER LOWS & LOWER HIGH - 16th May 22
Sanctions, trade wars worsen US inflation - 16th May 22
AI Tech Stocks Earnings BloodBath Buying Opportunity - 14th May 22
Futures Contract – Trading Crude Oil With USO - 14th May 22
How to Get Kaspersky Internet Security for 80% Discount! Do not Pay Renewal Price! - 14th May 22
Sagittarius A* Super Massive Black Hole Monster at Centre of Our Galaxy REVEALED! - 14th May 22
UK Public Debt Smoking Inflation Gun - 13th May 22
What Happens When the Stock Market Dip Keeps Dipping? - 13th May 22
Biden Seeks Inflation Scapegoats; Gold Advocate Wins GOP Primary - 13th May 22
Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - 12th May 22
The War on Gold Ensures the Dollar’s Downfall - 12th May 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Stock Market Volatility Soaring....Whipsaw....Down Bias For Now.....

Stock-Markets / Stock Markets 2014 Dec 18, 2014 - 10:59 AM GMT

By: Jack_Steiman

Stock-Markets

Volatility is soaring and traders are suffering. Too difficult to play with massive whipsaw moves intraday just about everywhere, but with the trend still clearly lower for now. When the VIX is in the low teens it's easy on the soul, but when it rockets in to the lower 20-range, things can get very intense. You can barely keep up with the score. You blink and the S&P 500 moves five points. You blink again and it's another five, and so on. The range for the day across the board on all the key-index charts can give you motion sickness. Huge drifting. This is when markets become too difficult to put the finger on the buy or sell button. It becomes luck trades and that's not what you want to be doing. It can work, but Russian roulette is better used somewhere else.


So volatility was soaring and it too was whipping all over the place. This all began when the markets recently topped out. 50-day exponential moving averages disappearing on the key-index daily charts. The S&P 500 now clearly below, thus, those 50's are now resistance on rally attempts. 2019 the level. Bears get more aggressive when those 50-day disappear and we saw that big time today when the futures were up pre market. The S&P 500 tested to those 50's and died right there. A few attempts to get back through were wiped out quickly enough. The bears showing they won't be scared away as easily as in the recent past. So today was another down-day, but things are getting very oversold now on the short-term charts, so we should expect some type of rally shortly. The VIX should signal that moment.

What's the best way to hurt the masses? The market can be very nasty sometimes. It can show you one thing one day that says things are very bullish only to twist it around shortly, thereafter, and take down the masses. That's seen best in the behavior of the financial stocks. A very long-term base finally broke out with Goldman Sachs Group, Inc. (GS) leading the way. The breakouts across the board held for many days which often signals the coast is clear. The other side of the trade is done. The bears pulled out the rug on the financial bears, and we are now seeing all those stocks lose the base breakouts. Very nasty action there.

When breakouts fail it doesn't mean it's done for good but it can signal a longer period of failure to be sure. You can go from breakout to breakdown rather quickly. Let's hope those bases hold, but if they don't things could get very ugly not only for those stocks, but the entire market since the financials are heavily weighted and can lead lower. Many other sectors are showing topping action. The Market Vectors Biotech ETF (BBH), or the biotechnology sector, doesn't have the very best looking oscillators on its daily chart. MACD crossing down from high levels with a gap down to act as resistance. If more and more join in the selling can get much worse, so let's take it easy from here for a while, until the VIX signals the all clear for a little while. The market is showing its dark side these days. Respect it.

All of this is great for sentiment. There is always an upside to things when the market falls. The bull-bear spread is hopefully at, or below, 30%. It has been at, or very above, 30% for ten straight months. That's terrible. The market is paying a small price right now. Another bad week here and we could see mid-twenty readings. Hopefully, even lower, but it's good to have the spread out of the 40's. We stay out of the way here knowing 2019 is going to be very difficult resistance on any counter-trend rally attempts. The lower the better for the short-term, but we are very oversold, so we can rally at any time.

Be smart and keep things very light all around. 1941 next support on the S&P 500, if we can't get back through 2019.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Sign up for a Free 15-Day Trial to SwingTradeOnline.com!

© 2014 SwingTradeOnline.com

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in