Jump to content

So Full of Surprises 10/20/20

Rate this topic


Recommended Posts

About 85% of the mass in the universe and 25% of its mass-energy is made up of dark matter. Dark energy is thought to account for 68% of the universe's energy.  NASA says, "More is unknown than is known. We know how much dark energy there is because we know how it affects the universe's expansion. Other than that, it is a complete mystery."

The stock market is like that. We can see the forces driving some of it. We can understand how they work. But there are unseen forces that we don't understand. But we know they exist because we can see their effects through Technical Analysis. 

We saw the effect of Dark Energy yesterday. The market is no longer perpetually extending into the outer reaches of space, driven by Fed energy. 

Something is holding it back. 

I think I know what it is. I've been talking about it for months. Corporate supply. For me at least, it's very difficult to measure. Some organizations track and report gross issuance soon before  and after the fact, but no one that I know of tells in real time the amount of net issuance that's on the way or has just hit. It's that net new supply, not the paper being rolled over, that sucks up the market's energy. 

The Fed is taking care of Treasury supply. We know that. But the market must also absorb wave after wave of supply of both net new debt and equity, that corporations are creating and selling. The old buyback fraud is dead. Corporations have seen their revenues cut. Many can't fund their self theft through their revenues any longer. So they cut the remaining pie into smaller pieces and sell it to the public. Mostly the institutional public. 

They don't have the money to absorb all of it at these high prices. They must sell something else to raise the cash to buy the new stuff. 

So we get days like yesterday. We see only effect. We know that dark energy is behind it. And we use TA to observe the effect, and forecast the trend.  

Here's what's up for today. 

The market has tried to set a bottom, but it faces a huge resistance obstacle around 3340-45. What comes next depends on what happens there. If they rollover, at most that sets up a trading range of 3405-3440. It should get worse if that zone generates only a weak bounce. 

Conversely, if they get through 3440, the next resistance target would be 3460-65, with the potential for more. 

tvc_8690fa9d49a7c4381f4dc61fce650a64.png


 

 

  • Like 1
Link to post
Share on other sites
  • DrStool changed the title to So Full of Surprises 10/20/20
  • Replies 28
  • Created
  • Last Reply

Top Posters In This Topic

Top Posters In This Topic

Popular Posts

About 85% of the mass in the universe and 25% of its mass-energy is made up of dark matter. Dark energy is thought to account for 68% of the universe's energy.  NASA says, "More is unknown than is kno

In the long run, the Fed’s determined to make all shares big caps....

https://aip.scitation.org/doi/10.1063/5.0029118 Even with only 9 students in the room and 2.4 m distance between students, the aerosol (1 µm–20 µm) is transmitted in significant quantities betwee

30 minute bars. First they did, then they didn't. I've adjusted the downtrend channel slightly. 

3440-45 is still the range they need to clear. 

tvc_e1593089e4a66c357452f7d6b80a3cb2.png

 

Link to post
Share on other sites

All of the intraday patterns on my bearish watch list for day trading have turned, or are turning bullish. This is a freaking monolith. Massive squeeze. 

Link to post
Share on other sites

If it weren't so funny I would laugh. What I can't figure out is where yesterday's selloff came from. Dark matter, I guess. 

Link to post
Share on other sites

My trading platform sounded like a hospital emergency room an hour ago. Now it's dead quiet. Everything has moved away from trigger lines. 

Link to post
Share on other sites
Guest
This topic is now closed to further replies.
  • Tell a friend

    Love Stool Pigeons Wire Message Board? Tell a friend!
  • Recently Browsing   0 members

    No registered users viewing this page.

  • ×
    • Create New...