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Not as Bad as It Looks 4/2/20


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20 minutes ago, fxfox said:

"The market" simply says: Corona will end sooner than most think and there will be no Great Depression 2.0

Will the market be right?

Will the central banks be right, they define the Market......

>: an old article during the original QE, now we have Infinite QE +

https://finance.yahoo.com/news/the-fed-caused-93--of-the-entire-stock-market-s-move-since-2008--analysis-194426366.html

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Everyone knew the unemployment numbers would be the bad. I agree that was "priced in." But that's the tip of the iceberg of the bad news coming. I'm still thinking we'll have a waterfall Monday morning and eventually retest the lows. Sometime over the next month plus in quarantine people are going to get shocked by the death count, infected family members, friends, coworkers & neighbors, junk bond defaults, downgrades, bankruptcies, out of business signs, etc. And who knows what is going to happen in the EM space or even in the developed world. This is not the bottom. But if we do make it back up to the 50 fibo it'll be time to unload longs and reload shorts. 

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9 minutes ago, sandy beach said:

When I see these kind of "humps" forming the whole thing is like the exponential modeling done by Didier Sornette during the dot com crash and the financial crash. This is typical of these types of moves. 

 

Could you please elaborate on that a bit further? I know that Sonette tried to predict bubbles, but I do not really get your point here.

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Markets don't "price in."  They rise and fall on the sea of liquidity.  And in the very short run, there's a lot of random noise related to news and the short term positions of a few whales. As humans, we always want to read meaning into things were there is none. 

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Look at the daily chart. A big nothing burger.  I can't predict which way this will break. 8 week cycle tuned MACD still bullish. RoC non-committal but weak absolute level. 

 

tvc_6a5b79c61868dfebfe4e8f9c88ad8c48.png

 

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