The Gathering Storm
The Gathering Storm by Jesse – Jesse’s Crossroads Cafe’
“Sometimes I wonder whether the world is being run by smart people who are putting us on, or by imbeciles who really mean it.”
The gap in the SP 500 futures continuous chart that we left behind a few weeks ago has just been filled intraday.
As a reminder this is a stock option expiration week, although as I recall May is not a particularly significant month.
I imagine a lot of enthusiastic call buyers have just been smoked out of their seats and their June positions.
The tension on the tape the last few days was palpable. It just took some small event to trigger it giving its overlong duration and extent out of balance.
I don’t think impeachment is on the table for President Trump, except in overheated Democratic rhetoric. Although I would not rule anything out while The Donald has access to twitter.
The NDX has a quite a way to go to close its gap, but that is another matter. For my purposes the SP 500 futures are the bellwether.
I have pulled in my short positions, and just left some other risk off positions run, mostly in gold. No silver at this time for a trade. It just doesn’t work as well in a panic because of its precious/practical nature.
My cynical side says that this market pullback is just a long overdue correction in the Trump rally. But we will have to wait and see where the stock markets finds a footing, or if contagion of selling starts to trigger liquidations and some sort of selling feedback.
As I noted the other day, this is a concern for me because the nature of this rally has been narrow and price driven. People were throwing money into passive index funds, which were rising steadily thanks to speculation in about ten stocks.