Market

[Pascal]

AAPL reversed from its overnight highs on strong selling. The market weakness is not helping.
There was a tentative bounce but this type of bounce cannot work if the Money Flow stays negative.
So no long trade today.


Pascal

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[Pascal]

The 20DMF only shows a slight accumulation today: higher prices do not attracts renewed selling. This points to to possible continuation of the bounce.


Pascal

43635

[Pascal]

Nothing good to see here for now.


Pascal

43700

[Pascal]

No reason to jump in and buy the bounce for now.

Pascal

43710

[Pascal]

I did not expect to see the 20DMF so dull today.
What is this market expecting? When will they push things up? The QQQ Max pain level is $164, which is not that far away. The SPY max pain is 277.5. A little far I believe, but that can be done.

For now, I'll be waiting to add to the long positions.


Pascal

43745

[Pascal]

Today, the 20DMMF shows weakness while the NQ8 MF shows strength


Pascal

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[Pascal]

I would not rush to buy for now.


Pascal

43953

[Pascal]

Similar bearish pattern as what we had on March 1rst.


Pascal

44029

[Pascal]

Finally money came back in during lunch time and the day was saved.


Pascal

44030

[Pascal]

Bounces are sold, but the NQ8 look stronger than the rest.

Pascal

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[Pascal]

Markets are very negative today, especially the NQ8 sector. The Negative EV pattern on FB detected on Friday clearly indicated an underlying issue. This pattern shows that some large players were selling the not yet published news.

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Pascal

[Pascal]

I had been expecting some sort of shakeout before a reversal, but the market has been flat since the open. Hence, difficult to take a strong position here either with or against the trend as there is NO trend.

Is the market waiting for some announcement from China? Is no-news good-news or possibly bad news in the waiting?

Pascal

44236

[Pascal]

Today's opening gap does not attract money yet, to the contrary.
The OB/OS signal is near its oversold level and the MF does not seem to be willing to move higher.
Patience is required on the long side.


Pascal

44251

[Pascal]

The S&P500 already erased the gains of last Thursday.

The NQ8 is in a small downtrend, but the Money Flow looks volatile around the 0 level.

Basically wait and see for now.


Pascal

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[Pascal]

Market is really non-directional. Large players do not seem to buy today's bounce, while small caps display a negative Money Flow. Maybe some fear regarding bearish FOMC minutes tomorrow.

Large caps energy stocks (XLE) look bullish here.


Pascal

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[Pascal]

The NQ8 MF looks weak today, but on a longer term view, we seem to be in a tight range.


Pascal

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[Pascal]

After early weakness, the NQ8 sector has bounced but on a relatively weak Money Flow.
This indicates that investors are not ready to buy NQ8 weakness yet.

Pascal

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[Pascal]

I did not expect to see this type of selling today. We can also note that the price bounce does not seem to be attracting money.

My guess: inflation/rate hike fears next week.

Pascal

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[Pascal]

There is speculative buying around AAPL, which triggered a positive Money Flow on the NQ8.

For now, nobody really knows what AAPL will announce at the close. We could however get a relief rally tomorrow though.



Pascal

4460744606

[Mike]

These two charts are where my head is at relative to the overall market. I see similarities of the current market to the October 31, 2007 market top. In both images, the Russel 2000 fails to confirm the last NASDAQ higher high. At the time in 2007, I thought July was the top, then Bernanke gave us a surprise 0.5% rate cut on September, 18. The market zoomed into a blow-off top, where I was surer of the top.

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For my market read to be correct, a recession would logically need to be close by. This article by John Mauldin is a good read and it explores this possibility. http://www.mauldineconomics.com/frontlinethoughts/economy-with-a-fever

In 2007, we had a very major market top (larger head and shoulders pattern) where the NASDAQ dropped 55.7% over the course of 17 months. Both 2007 and 2018 are showing head and shoulders patterns. The 2018 pattern looks smaller to me, possibly implying less than a "bone-cruncher" type bear market of 2007-2009, maybe only half as large.

Of course, every bearish call of the last few years have led to the market making new highs.

[Pascal]

The NQ8 Money Flow looks rather negative today, but the 20DMF doe snot show fear for now.

Not buying anything here.



Pascal


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[Pascal]

Buyers on strike today.

Pascal

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[flywest]

Pascal, second day with this divergence. Been watching on RT. Do you think lighter than normal volume could be contributing to this?

[Pascal]

Pascal, second day with this divergence. Been watching on RT. Do you think lighter than normal volume could be contributing to this?

As I explain in today's comment, this was probably only due to morning weakness in FB/AMZN/GOOGL.

I shorted the S&P500 when I posted this message but covered the short when the 20DMF Reversed higher. This buying of morning weakness reinforces the bullish case of stocks, especially non NQ8 large stocks.


Pascal

[flywest]

Got it thanks! Since indices were moving up without those Faang stocks i surmised we'd see some price weakness later in day. Wow what a move.

Take care

[Pascal]

Really impressive systematic buying. It is as if there was some constant/regular liquidity injection.
Is it a central bank initiated message?


Pascal

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[Pascal]

When liquidity is not present then bounces are not sustainable.


Pascal

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[Pascal]

The 20DMF and the NQ8 still feel heavy today, but it is Friday and algos might have been disconnected waiting for Monday and hoping that no trade war issues will emerge over the weekend.



Pascal

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[Pascal]

Today we are in an everything-for-sale type of environment.
The 20DMF turned short intraday.

Pascal

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[Pascal]

Activity is slightly positive today, but not impressive.


Pascal

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[Pascal]

Who could have imagined that the gap down due to the NFLX subscribers weakness would have been bought. It could be that NFLX results have no consequence for FB, AMZN, AAPL, MSFT, NVDA...


Pascal

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[Pascal]

No weakness today: the money flow is positive everywhere.


Pascal

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[Pascal]

Market is probably setting up for an afternoon bounce.

Pascal

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[Pascal]

Interesting activity today: buyers came in at 10:30 on the NQ8 sector (AMZN, FB and some other stocks.) This pushed the S&P500 higher, but the 20DMF clearly shows that there is underlying weakness.



Pascal
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[Pascal]

Today, the NQ8 is weaker than the NQ100 in terms of Money Flow. This is due to AAPL.
It is something important to note looking forward.


Pascal


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[Pascal]

To know whether the bounce has legs, one clue is to see if it attracts money.

Better do that in the afternoon though as this is when the funny money used to appear.


Pascal

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[Pascal]

No need to rush to buy weakness here: the Money Flow is still negative and the etch side of the market is taking a hit, especially the semiconductors.


Pascal

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[Pascal]

Today is a non directional consolidation day


Pascal


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[Pascal]

Market is weak today, especially the small caps. No sign of a reversal, even though the NQ8 Money Flow is still above 0.


Pascal

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[Pascal]

The gap up does not seem to attract buyers. I guess that not many traders want to be long/exposed over the week end.

Pascal

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[Pascal]

Today, the selling is too strong to be adding to the long position.
wait and see



Pascal

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[Pascal]

Some accumulation today. This could be due to options expiration though.

Planning to increase the long position here


Pascal

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[Pascal]

Roller coaster patterns are not good, especially for broad indices because they point to liquidity swings. Algos have been detecting liquidity inflow and then outflows and acted accordingly. This tells us that there is not stable flow and hence no trend is reliable, nor are sustainable narratives supporting any market direction for more than a day or two.

Out of the markets for now


Pascal

4622746228

[Pascal]

Today's activity is still miserable in terms of Money Flow.



Pascal

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[Pascal]

The positive Money Flow divergence at the start of the day was a good indication for the rest of the day.


Pascal

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[Pascal]

Tech under pressure as each price bounce is sold.


Pascal

46298

[Pascal]

This type of linear accumulation points to outside money destined for market support.

Not good to be short here unless that money vanishes.


Pascal

46318

[Pascal]

No sign - yet - that Santa Claus is preparing some present from China.
We should expect some trial rumor anytime though.


Pascal

46328

[Pascal]

No real conviction today. Is Santa Claus dead?

Pascal

46449

[Pascal]

Very poor market today. The 20DMF is about to issue a short signal.


Pascal

46461

[Pascal]

No improvement today: prices down and sellers active.

Pascal

46495

[Pascal]

Nothing good happened after the Fed decided to raise rates.

Pascal

46572

[Pascal]

Not buying yet; Wait and see for now as large players are not really buying.


Pascal

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[Pascal]

Today's pullback is still attracting money for now.


Pascal

46730

[Pascal]

The NQ8 section of the market looks rather weak today compared to the 20DMF.
I was thinking that AAPL would have been the target in China, but it seems that most of the NQ8 stocks are down and under heavy selling (AMZN, MSFT, GOOGL, FB, but AAPL not so much).

This points to Index followers selling the most liquid stocks.


Pascal

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[Pascal]

Market still rather weak today.
Lower prices do not seem to be attracting money, but things could change in the final hour.


Pascal

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[Pascal]

Higher prices seem to be attracting profit taking this morning.


Pascal

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[Pascal]

Not much weakness today: neither on the 20DMF nor on the small caps.


Pascal

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[Pascal]

I have a hard time to understand these markets gyrations.
I guess many traders are in the same position.
The most important is not to lose money.


Pascal

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[Pascal]

Today's weakness is being bought.



Pascal

47669

[Pascal]

Still no short signal for now.
Probability is about 50%.



Pascal

47862

[Pascal]

A sudden drop in the 10Y points to a market reversal or at least a tentative reversal.


Pascal

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[Pascal]

The QQQ is rather weak with selling on GOOGL, AMZN and MSFT, but AAPL looks to be under accumulation.

Anyway, the 20DMF is not negative here.


Pascal

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47902479034790447905

[Pascal]

This bounce does not seem to be attracting much money for now

Pascal

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[Pascal]

Still money moving in the equities markets today.

Pascal

48212

[Pascal]

Yesterday, the 20DMF turned to cash from a long position because it crossed below the -0.11% level while the Cumulative Tick was above its average.

We can below that this morning, the 20DMF turned back toward the Buy level

48345

However, after the Trump Tweet on the Chinese trade issues, the market turned sought again, but this time, the Cumulative Ticks moved below its average line, triggering a short signal.

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This does not look good going forward: we are in the middle of the earnings season and the Fed is done lowering rates until probably end of the Year. The question now is what will support elevated equities prices?

[Pascal]

Not good to see an intraday oversold bounce attracting sellers


Pascal

48541

[Pascal]

Below is the list of today's long and short ideas.
We can see that except for the BOV, all the long ideas are higher than their highest entry point.
We can also see that 6 out of 7 short-a-bounce type of idea are higher than the entry price.

This indicates that the whole market is bouncing higher. It is not a good idea to enter new individual positions here.

Tomorrow will be a dull day because Monday is holiday.

Hence, no new trade for me today and tomorrow. Better wait for some new opportunities next week.

Note also below that NQ8 stocks are attracting heavy buying even after the gap up.


Pascal


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[Pascal]

Market weakness is bought today.


Pascal

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[Pascal]

Accumulation going in a straight line.
Machines working.


Pascal

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[Pascal]

As soon as the machines stopped buying, the market fell.


Pascal

48729

[Pascal]

Markets fell on the non confirmed news that there will be some restrictions to trading Chinese firms in US exchanges. This is of course a negative for the said Chinese firms, but in general, I believe that money will rotate out of the China related sectors... if this has not been done yet.

Health care stocks look interesting here... But algos first have to deal with the general liquidity withdrawal before positions can safely be rotated.


Pascal

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[Pascal]

Higher prices are attracting money today. markets will continue higher.

Pascal

49331

[Pascal]

No selling during the pullback

Pascal

49446

[Pascal]

It does not look good when the market bounces without large players supporting the bounce.


Pascal

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[Pascal]

This baby does not behave well today.
We'd need a heavy hand to buy this afternoon so that the S&P500 does not close negative for January.

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[Pascal]

Are markets bouncing because of this?

https://www.tellerreport.com/news/2020-02-18---seventy-year-old-malaria-medicine-works-against-coronavirus-induced-disease-.BJlPzFK78.html

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Pascal

[Pascal]

We are now close to the short level.


Pascal

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[Pascal]

After turning to oversold yesterday, the market continues being brutally down.
I am not courageous enough to buy here.


Pascal

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[Pascal]

Some negativity still perceptible here: when the market pulls back, large players are eager to sell fast.


Pascal

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[Pascal]

The morning breakout was bought but this move is fading fast now.
Let's hope that the Fed comes to the rescue at the end of the day

Pascal

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[Pascal]

Market still weak today: after opening low, the bounce attracted wide spread sellers as can be seen on the Cumulative Tick.

Neither was the most recent SPY bounce supported by the 20DMF.

This points to more weakness



Pascal

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[Pascal]

I believe that in the future we will see many more similar patterns: a dead sector being bought in a straight linear way.


Pascal

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[Pascal]

I was expecting weakness today, but to the contrary, money is coming in.
So wait and see.

Pascal

50491

[Pascal]

I feel somewhat uneasy to see some almost linear accumulative Money Flow. It is as if a money printing machine was directly attached to the market.

This is certainly not the type of pattern that retail investors will generate.
It is a pattern that is generated by funny money that is closely followed by index investors (ETFs) and large funds. Nothing scientific or linked to value here.

Pascal

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