Alternative Reality

[gdl]

Pre-market: Didn't take earnings and Home sales well.

If this is the start of a rally it sure is the weakest 4 day move ever. Usually the first 3 day off a long drop results in a powerful move before any weakness is seen.

I keep harping on the notion that we need to breakdown before we breakout of down channel. .10 year yield back at 3%. Tomorrow when the explosive resale of homes comes out I expect a big jump in 10 year yields. it has been trailing the data for a long time refusing to accept the inflation data.

The data is telling me the street is not prepared with prices still too high but the candlestick patterns have kept the drop to a minimum. Everyone sees the charts and visually we have a 5 wave drop right here. All are assuming a rally is on hand. BUT "I" have never seen the start of a trend change look so weak.

A 7th wave fast deep drop soon? Been expecting it and 4000 hold up well. If we do breakdown 3500 is likely bottom.