DrStool Posted August 8 Report Posted August 8 At first glance earlier this morning, this setup looked bullish. Now it's 55-45, in my view. They've got work to do, and if they fail, this could just as easily fall apart. A 3 day cycle low is due around the NY open. They need to hold above 5183 on the ES in that first half hour of regular trading. Failing that, the odds would start to shift toward the downside. They need to be above 5190 at the NY close for a bullish look. On the other hand, if they break 5155, this could get very ugly going into Friday, or Monday. On the other hand, if this ends above 5220 today, that starts looking more bullish. Implications of Market Ahead of Itself Meanwhile, another $5 billion came out of the Fed's RRP slush fund yesterday, bringing the net withdrawals to $112 billion since July 24. That slush fund will be out of cash really fast if this keeps up. Much of that was directly driven by CME margin increases, but some was also due to the short squeeze in bonds. Mind boggling when you think about it. More than $2 trillion has been withdrawn from the slush fund since April 2023. I had forecast this and we've tracked its progress right along the way. I also made a prediction about what will happen when the fund runs dry. No more water in the well, oh no. Why Primary Dealers Net Short Fixed Income Is Now Bad News for Stocks- August 1. Over in the Treasury market, the bearish hedge positioning of the dealers, and extreme bearish positioning of hedge funds in the futures have triggered an awesome short squeeze. That squeeze has exhausted itself and partly reversed over the past 3 days. As I described in Liquidity Trader reports, that mispositioning is part of the reason for the liquidation of stocks. When margin calls come, those needing to cut exposure raise cash across all investment classes. I cover what to expect in Liquidity Trader. For moron the markets, see: Swing Trade Screen Picks – Missing 80% August 5, 2024 Implications of Market Ahead of Itself August 5, 2024 Tax Collections Were Worse than the Jobs Report But… August 5, 2024 Why Primary Dealers Net Short Fixed Income Is Now Bad News for Stocks August 1, 2024 Stars Suddenly Align for Gold August 1, 2024 End Stage Hysteria Breaks July 24, 2024 Picking Up Nickels in Front of a Steamroller July 9, 2024 If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam folder. Quote
DrStool Posted August 8 Author Report Posted August 8 In TA, this is known as the SPROINGGGGG opening. Quote
MisFit Kid Posted August 8 Report Posted August 8 and the daily jam job open,,,,,,,like clock work for them...... Quote
DrStool Posted August 8 Author Report Posted August 8 Jumped the shark. If this holds for an hour, the 2-3 day cycle projection will be 5310-20. Quote
BurntOnce Posted August 8 Report Posted August 8 boeing and intel are two sides of the same laughing stock coin. Quote
DrStool Posted August 8 Author Report Posted August 8 5 day cycle projection 5360. That's also a channel convergence in the next hour. High probability pivot point. Quote
DrStool Posted August 8 Author Report Posted August 8 The chairman of the NTSB reads Capitalstool! “We don’t know and neither do they, and that’s a problem,” NTSB Chair Jennifer Homendy told reporters during the hearing. 1 Quote
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