Traders Cooperative

[Wishthiswasmyjob]

Friday actually surprised me...
Take a look at the chart below -
the 15 minute candles on the main ETF's.

Friday was a perfect opportunity for the Bulls to grab control and start climbing - To confirm support and start the upward rally.
We had green futures going into to open, we gapped up and then...
The Bulls fumbled badly and the selling just dominated the entire day, after the first hour. It wasn't so much a situation of shorts and Bears taking over as it was just a scenerio of distribution.

15 minute

This has become such a news driven market...
There is soo much uncertainty now - whether it is the Russia / Ukraine war, the Fed meeting this week and rate / stance questions, or even the China "quietness".

We can also see on the 60 minute chart, we may be getting a pennant and a "decision point". At this time, without any large, positive news, one has to think this pennant breaks downward and we go to below 410.

60 minute

I keep feeling a rally is "right around the corner", but downward channel markets can be brutal and last longer than you think.
That's why, at this time, it is best to just keep the powder dry and watch for the good buys to just keep getting cheaper.

A news driven market can move the ETF's 5% in 48 hours, so there is risk either way and the option premiums reflect that.... Watch for the overbought and/or oversold opportunities on the 5 minute charts and be nimble... That's about the only way to "make plays" here. That's exactly what occurred 90 minutes into the trading day on Friday. A put buyer, who recognized the upward fuel was fading... who saw the advance decliners was falling fast, was able to make good money.

Back onto my "ready for a rally" thoughts...
We're NOT oversold here and we haven't seen real capitulation signs...
We're still highly overvalued and expensive here on the longer term and so far, we're nowhere near a good, longer term buying spot here.

This chart shows the downward channel and that we're not heavily oversold, so whether you try to go long or short a bounce, be nimble and ready to grab profits quickly.
Again, in a news driven environment, with liquidation breaks occurring, you shouldn't think in "portfolio" terms.

Advance/decliners