Is this it? “It” being the long anticipated correction to clear the pipes of an over-bullish market? Perhaps for a final drive into or through the election? Maybe. Let’s look at some pictures on a striking day when NVDA did its NVDA thing and ramped, and the market ramping with it before reversing and soiling itself.
Hmmm, what reserve currency/anti-market might be behind this move? That would be Uncle Buck as it continues to hold its uptrend channel and is now making an attempt at the junction of the SMA 50 and lateral resistance (looking less like a bear flag). Yesterday’s update noted:
If it is not a bear flag and USD takes out the SMA 50 and resistance our already building caution (given the target acquisitions noted above) would increase. Your move, Uncle Buck.
If it is a real recovery by USD, risk management will have been well worth it. If not, it’s back to the old and tired perma-bull theme. Patience is a good thing until it plays out.
VIX is having an outside day, meaning that market players could not decide whether they are full on momo bubble heads in the wake of Nvidia or risk averse. Currently, the risk averse side of the equation is dominating today.
SPX shows a bearish engulfing candle, which would be a bad omen (short-term, at least) if it closes the day in that condition.
Stocks may be following precious metals and other commodity/resources items that got hit first. We’ll have to see how it shakes out. But remember that gold hit target, TSX-V hit target and GDX/HUI came within hailing distance as did silver.
For me, it means continued cash raising, which began a few days ago. I anticipate buying either sooner or later. But before then and speaking personally, I need to be strong, which means being very heavy in cash.
As a final note, this could well be a shake out, but I am not testing that theory with my money. Not after gaining profits to this point, a significant portion of which I want to convert from paper to realized.
