Markets dove after the open… the DOW is down 120+ and the SPX just pinned the 890 area. That’s a very important level, it’s where the 61.8% retrace and the 50 day moving average are located. Here’s a 20 day chart:
And here’s the daily, note the sell signal on the stochastic. I have my slow set pretty slow, so this cross came slower than others that I track. You can see that we have already engulfed yesterday’s candle:
TLT moved up to fill its morning gap as equities sold off. Perhaps it will remain in this range a little while longer, but I began scaling into short positions here regardless, but just a small position to begin with. We’ll see, that 3 peaks and a domed top chart pattern are talking loud and clear… Here’s a 6 month chart, you can clearly see the 3 peaks, the ramp and the domed top. This is a classic parabolic chart, one that says there is downside coming here. Also note the volume pattern… during this latest move down volume was increasing and now that it’s leveled off in the 112 area the volume has fallen off. Watch to see if the volume picks up on a break lower, that will be a sign that we’re headed back down and interest rates are headed up. That would be a bad deal for equities.
Economic News , Data & Views ...... October 22 , 2016......Quick hits for Saturday - 1) Markets & Market Moving News : Doug Noland's Weekly Overall Of Markets & Essay ; Global Stocks Gain 264 BL In Market Cap last Week ; Italy's Outlook Cut To Negative , Affirmed At BBB+ ; Cyprus Upgraded To BB- From B+ , Outlook Pos ; Portugal Confirmed AT BBB , Outlook Stable ( Still Qualifies For ECB QE AS Investment Grade Retained ) ; EZ Debt / GDP Dips Slightly - Now At 90.4% ( From 90.7% ) ; EUCO Summit Leftover ( Brexit / CETA / Russia Sanctions .) 2) Emergence Of Duterte In Philippines Has Changed Relationships Between Philippines and Nations such As US / China & Russia , America's Asia Pivot In Tatters As Futerte Seeks Closer ties With China & Russia. 3) MENA - Odds & Ends From Iraq , Libya & Syria.
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