I am starting to see a couple of interesting short term patterns emerge in the markets. US equities are starting to slowly trend back upwards:and risk in the market (as measured by the VIX) seems to be subsiding:
Earnings season is now upon us and so far the only major earnings component that has been released is the J.P. Morgan earnings report that came in Friday before the market opened. After the report was digested by the marketplace, prices fell dramatically.
Last week we received reports that the unemployment rate in the United States was improving markedly. In addition, sentiment numbers were released that confirmed my previous speculation that market participants were becoming more and more bullish as prices in the S&P 500 edged higher.
The last week of the year volume tends to be light due to the fact that big money traders are busy enjoying the holidays and waiting for their yearend bonuses.
I was not planning on doing much this week because of the low volume but after reviewing some charts and risk levels on my top 5 trading vehicles I could not help but share my findings with everyone last Friday.
The lows at 1101 were a convergence of Fibonacci weeks, months, sentiment bottoms and VIX extremes along with major insider buying all at the same time.
“The paranoia gripped us, The rain turned engines to rust
The panic set in like a cancer to our hearts; Spreading through
We bet on finite genius; Or prayed for God to save us
But there was no antidote, Disease tore us apart
We left bodies in the fields, So numb that we forgot how to feel.”
