Stock Market Analysis

Tuesday, January 05, 2016

A Completely Uncertain Day...

Did I just mention the China bubble popping two days ago? Yesterday, the Chinese market did exactly that, resulting in a dive in the US market yesterday. I even explained yesterday in my report to paid subscribers how the bullish divergence pattern I identified last week has already played out and has been taken over by a new declining peaks pattern.

(Yes, I only publicly post my report here every other day at best but paid subscribers get my reports DAILY for LIFE... sign up now! Only $99 for LIFE! And it takes only one winning trade to make that back and MORE, you know it!)

Market today did see the accumulation that I mentioned to paid subscribers yesterday. This was what I said:

"However, today's market action does seem a little overdone, as such, looking at how the market actually found some late strength today, I won't be surprised to see a bit of an accumulation tomorrow."

I also said that any accumulation at this level within such a market framework only makes each positive day a good time to accumulate some long put options. I even dialed the market crash timer up half a notch to ORANGE/RED in reaction to how the China market did since I expect the China slump to be one of the main contributors of the coming recession.

Even though the overall market framework is bearish inclined, this level is going to be a level where the bulls and bears fight it out as it is also an attractive accumulation level for the bulls. Bond yields reflected this uncertainty by barely nudging and total equities put call ratio also retraced to par with equal amounts of call and put trading. My Star Trading System also reflected this sentiment precisely with equal numbers of bullish and bearish opportunities. All of these before this Friday's jobs report which is expecting a worse number than last month which isn't hard to beat. But if it turned out worse than a lower expectation, it could be really bad and this time, we don't have the "avoidance of rate hammer" bullish reasoning for any worse than expected outcome.

Market Crash Timer: ORANGE / RED

For now, the market remained in short term bear trend within an intermediate and primary neutral trend. 


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