And I thought yesterday was ugly. Today's candle is do big it covers the volume bar, so I put a blue arrow where the top of that bar is, it was that kind of day. there was some hope early that the 200dema would hold (the simple average was broken right at the open), but once that broke, it was elevator going down, and no doubt it was exaggerated by the HFTs switching from buying to selling as soon as that average was broken. We are now just a handful of points above 1250, which in my mind is the separation pint between a correction and a genuine bear market. Break that, and it's panic time. .
Oil is also beginning to collapse, and as the margin calls go out, this will accelerate. Worsening economic conditions will kill demand here. What is really tragic is that low prices will also kill future supply. I said before any recovery will face stiff headwinds from oil, and it;s going to get worse.
this is particularly troubling. With a recession coming, I would expect to see gold dropping, but it's doing the opposite. From a chart perspective, this chart makes sense, but from an economics perspective, it doesn't. It could be that the gold market is seeing something besides a recession coming, such as severe political unrest.
You don;t see the yield on the ten year treasury screaming lower like this on recession talk. The bond and gold markets don;t seem to like what they see,
One thing we aren't seeing, and we probably should be seeing, is the dollar screaming higher as traders de-leverage. I would almost feel better if we did see that. At least for now, it has stopped dropping, but that isn't much consolidation.
0 comments:
Post a Comment