The US stock market will make an up or down decision on the very short-term while the larger relief rally is still intact
Yesterday as they bulled the markets on the November CPI report’s disinflationary whiff (ha ha), I noted my short positions against SPX and DJIA and how the sentiment relief party may have been ready to resume. Well, not so fast.
A reversal yesterday saw SPX close below the SMA 200 once again and today the market’s little rally reversed after the eggheads rendered their well telegraphed decision. .5% was in the bag as we’ve noted.
So the picture – a moving target obviously subject to change/adjustment – is this…
- Either pull back hard in the micro-term to fill the lower gap and then rally (favored) or keep going down (not favored), or…
- Hold above 3900 and then set about finishing the bear market rally into Q1, and…
- At the next peak in over-bullish sentiment set about resuming the bear market in stocks (favored) or breaking the bear by taking out the key level noted in the post linked above (not favored).
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We are putting your favored view to the test. Seems SPX has pretty much just filled that gap!
Yup. As such, I covered shorts on SPX and DJIA.