The bulls are in command but today right after the SPY index open gap higher it had slowly drop to flat and rebound slightly. This meant the market closed below its open and it has not happen for almost three weeks. This maybe signs of consolidation rather than a drop in the coming days. There are other signs to watch. Tech sector QQQ is also consolidating. While small caps seem to be hitting a lower high, meaning more conservative investing ahead.
With FED propping up the REPO market and China's government literally supporting their stock markets it may take weeks if not months before a drop in the market is in store. On the other hand it start dropping before end of the week since today's lower close is less bullish than previous days. However I will not speculate a drop is immanent simply because the governments have intention of propping the markets.
I am still long bonds and holding cash, but avoiding commodities such as gold and oil. There seems to be a lot of miss directions as market is pricing in lower oil prices yet general market is continuing to rise. The is not as much fear in the market since gold prices is struggling. It is making higher lows but currently MACD is trending down so seems demand is wining which is bullish for stocks.
Posted via Steemleo