SELL MORTIMER, SELL!
I was amused once again, to be subjected to the shock and dismay of the talking heads over on CNBC tout television; agonising over 9 straight down days on the S&P 500. Something which has not occurred in thirty some odd years. Allegedly.
The culprit? Donald Drumpf of course! He and Russian hackers, the FBI, the right wing coup and tightening polls. Well…blow me down.
At the risk of appearing a bit pedantic – as the chart and bullet points will illustrate below – “smart money” has been leaving the market since the week of September 2nd. And it has nothing to do with the election. That is just the excuse du jour:
1. S&P has clearly violated strong support leading all the way back to late fall 2015
2. First possible Diatonic support (minor level) suggest an initial speed bump this week will be tested near 2065.81
3. Based on the leg established by the January and February double bottom and central bank induced vertical rally – to the week of August 19th all time highs; a 50% retrace suggests that real support comes in near 2002.41. At this level we have an equal amount of winners and losers. This is where the battle will be fought and decided.
4. Volume is increasing but has not yet cracked the 40 week (200 day) moving average. It is going to take much higher volume to put in a “real” bottom.
5. MoneyStream Index indicates that institutional money flow has been leaving the market since the week of September 2nd. Albeit quietly at first, and we did not really see the true effect until this past week. Note the accelerated death spiral and flat line that occurs leading in to November 4th.
We have enjoyed an over 22% faux money, central bank “three card monte” rally over the past 9 months. And now? It is time to bend over and grab your ankles Bullwinkle’s…
I am KingCAMBO, smoke em’ if ya got em’…and that’s how I roll…heading in to election week 2016.