Tue saw a sizable reversal which I see as a knee-jerk action similar to the knee-jerk reaction that caused the dip the day before. There are many reasons warranting current market movements but at this point, the coronavirus is a trigger, for it to become the cause of a market move will take some time, between a month to 4 months or more. My overall view remains that, at this point, there is more down risk than up risk
ES Journal - 2019/2020
- Thread starter Buy1Sell2
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A DCB on a Tday after 5 down days by weak shorts taking profits.
The bigger issue here is the market was actually down for the week for the first time since when ?
think initial support at 3240 was expected to fill weekly gap, but the rest of the week seems like a toss up to me.
My view is that a revisit of the 3,180 handles is likely, thereafter whether it bounces or not will depend on the status of the virus. The Fed wasn't very optimistic in its outlook and this virus has the potential to take the puff out of the consumer.
My view is that a revisit of the 3,180 handles is likely, thereafter whether it bounces or not will depend on the status of the virus. The Fed wasn't very optimistic in its outlook and this virus has the potential to take the puff out of the consumer.
That's scary. That is more than 10,000-fold increase in 20 days.
Let's not get too excited yet. After all, 20 million people have contracted the flu this year and it likely has a higher mortality rate than Crown Virus.
You seem to conveniently forget that there are vaccines available for the flu, which is not the case for the Coronavirus.
On best case historical scenario of -5.8% puts the S&P to 3,165. So my view of 3,180 is rather conservative. You also need to take note of the time frame... again, best case was 23 days, your prediction of a bounce tomorrow is rather premature also considering that the WHO is likely to announce a world emergency tomorrow. In your defence, it is true that in each case there was a bounce at the end of the emergency... but 2 factors could dampen that bounce:
1. Your parabolic bulls had put markets into overbought (to bubble territory) at the start so it's not likely that former highs will be seen before earnings warrant them.
2. China now represents 16% of the world economy... during SARS China was only 4% of the world's economy.
I'll also say this: traders that rely purely on charts are the lazy ones that will eventually blow their fortunes (e.g. the
Druckenmiller type), consistently successful good traders that never loose (e.g. the Simons type) look at all... history, fundamentals, symmetry and charts.
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