Word of the Day: Apprehension
So yes, it closed at a daily high above the 45EMA, up almost 2% on the day after a short selloff at open. That's a perfectly reasonable claim for a bullish mentality, but I just wanted to point out a few things here that I'm seeing and try to tie it into what I think is going on.
First, the most noticeable thing, is that the shape. Look how similar that price action is from the night of the 17th to cash open on the 19th and what we saw last night and throughout today (could mean another corrective drop?). Secondly, there seems to be a heavy respect for the 45EMA and BB, a sign of weighted MM influence. The most important observation in my opinion though is the volume. Today we saw about as much volume during cash session as we did in overnight futures session last Thursday into Friday. In fact, I'm pretty sure it was only really comparable to the volume seen on February 19th cash session. Definitely uneasy.
What am I taking away from this? Well, I'm putting this up pretty quickly, but to me those spikes in selling volume are big/smart money either selling off shares or purchasing puts to hedge. Without a big OpEx coming up, the MMs just let it melt upwards. No one was really selling today, but not many people were buying either, which is an apprehensive sign. Who knows how long this will continue, but it's clear that the MMs will price-pin at this level until retail buyers capitulate or buying becomes strong enough again and takes it parabolically upwards.
With what's going on in market right now, I can't help but feel a strong similarity to late February. A few weeks ago, people were back in the mentality of "the virus is all bull****, isn't even a big deal" and the market reflected that by reaching new highs ... very much the case in mid-late Feb. But then there was a slight correction followed by some fairly locked sideways action, as people started to see news of the virus spreading to other countries, but in our case this week, we're now seeing enormous upticks in cases in states that reopened, to the point where hospitals are now reaching max capacity again. New York City opened up for the first time in 3 and a half months today, but other cities around the country are starting to close down. Regardless of the shear devastation that we are still seeing within our economy, it feels as though it's only a matter of time now before reality hits and retail investors decide they want to be the first one out of the market.
First, the most noticeable thing, is that the shape. Look how similar that price action is from the night of the 17th to cash open on the 19th and what we saw last night and throughout today (could mean another corrective drop?). Secondly, there seems to be a heavy respect for the 45EMA and BB, a sign of weighted MM influence. The most important observation in my opinion though is the volume. Today we saw about as much volume during cash session as we did in overnight futures session last Thursday into Friday. In fact, I'm pretty sure it was only really comparable to the volume seen on February 19th cash session. Definitely uneasy.
What am I taking away from this? Well, I'm putting this up pretty quickly, but to me those spikes in selling volume are big/smart money either selling off shares or purchasing puts to hedge. Without a big OpEx coming up, the MMs just let it melt upwards. No one was really selling today, but not many people were buying either, which is an apprehensive sign. Who knows how long this will continue, but it's clear that the MMs will price-pin at this level until retail buyers capitulate or buying becomes strong enough again and takes it parabolically upwards.
With what's going on in market right now, I can't help but feel a strong similarity to late February. A few weeks ago, people were back in the mentality of "the virus is all bull****, isn't even a big deal" and the market reflected that by reaching new highs ... very much the case in mid-late Feb. But then there was a slight correction followed by some fairly locked sideways action, as people started to see news of the virus spreading to other countries, but in our case this week, we're now seeing enormous upticks in cases in states that reopened, to the point where hospitals are now reaching max capacity again. New York City opened up for the first time in 3 and a half months today, but other cities around the country are starting to close down. Regardless of the shear devastation that we are still seeing within our economy, it feels as though it's only a matter of time now before reality hits and retail investors decide they want to be the first one out of the market.
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