S&P500 Holy Crow Missal: June 26
Bad Numbers
Image 1. This time is different
Well I was wrong!
The Nasdaq has already posted fresh highs, with the S&P on the cusp as of writing. A month ago I wrote that I didn’t see the case for new all-time highs, but one world war later, here we are.
And as I mentioned last week, the tell may have been new highs in bitcoin - liquidity is still very much alive and pumping in the system. While the macro picture is deteriorating: see above graph, as the unemployment rate of recent grads is higher than the general population.
Simply trade the price action.
Reverend Bird’s Missal
Volume is very thin at these levels, with an accumulation of gaps and poor structure below in a tepid trading environment. If and when the market turns, this may be a recipe for a fast inventory correction. We are not here to predict tops however.
Image 2. ES ETH and RTH as of 7h15EST
As we grind higher, bulls are primarily focused on the 6180 March contract high, coinciding with a new SPX high - with 6200 above. These levels may see responsive selling activity.
Bears are being continually ground up - this is extremely dangerous price action to fade, and it is best to wait for a blow-off top, or a strong sell and a retest of balance below to enter short. You can clearly see this churn in the daily chart below.
Image 3. ES 30m chart and structural levels
Crow’s Nest: Thursday June 25
Monday pivot 6150. An early bid at 6155 leans long. GDP (and unemployment) numbers at 8h30EST can shake things up, especially if the macro is deteriorating as I project.
a) Defense of pivot and minimal time below 6143 targets 6168 / ONH, a break above looks to trade 6180 / ATH. Further above are 6192, 6202, with 6220-25 at an extreme.
b) Defense of pivot and momentum below 6143 targets 6135 and a break of daily OTFU to 6125. Further below is 6113 and 6103, with extreme targets 6092 and gap fill 6081.
c) VIX pivot 16.95. Sellers may be encouraged with the VIX over 17.20 19.15, with further buyer support below 16.50
Keep it simple, and don’t be a bird(fog)brain!
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