The situation seems to be very similar to March right now, but inversed. https://www.elitetrader.com/et/threads/this-is-what-a-market-bottom-looks-like.341912/ Comagnum also posted that fear&greed index which tends to represent sentiment quite well We are probably very close to the top. The tops can be tricky though as the market can squeeze up quickly into the climax and only then reverse. It's probably very close, but it will only be obvious after it happens though. Now seems a good time to unload your positions and wait in cash. Markets don't like uncertainty and we can't know how Trump will act, plus the Corona is starting to surge hard in the US and just by quick glance there are some problems going on in China-major companies defaulting? I am not a fundamentalist, so this is just bluff... But charts blowing off+ sentiment blowing off + economy starting to fall apart.... If it looks like a duck and walks like a duck, it is a duck.
Each time the Dow prints 2 consecutive days with a lower high and a lower low, I put in a spreadbet buy order just above the second high. One day this will stop working....
The list of smallc(r)aps doing 30-200% gains per day is unreal. Anything in alt-fuel vehicle sector seems to have no ceiling. This is party like it's 1999.
I’ve posted something similar here at least a dozen times since April. If you go back to my posts you will see I was incredibly bearish in Feb-March. Once the Fed jumped in to backstop JUNK BONDS you knew right then that the market would not be allowed to drop. NOTHING MATTERS IN THE MARKET EXCEPT THE FED. Been this way since 2009 and it’s getting more magnified with each and every more ridiculous program they come up with to flood the market with trillions. “The problem with betting on the end of the world is it can only happen once” -Art Cashin
Defo looking toppy, but picking tops and bottoms is a suckers game on longer time frames. Big boys need to rotate out and leave the retail suckers in to take the loss, not seeing that yet.
Yup look at FCEL been around almost 30 years and suddenly breaks out year long range just ... because. Same time their numbers are chit.
That means that once the Fed / central banks are unable to provide a fix, the collapse will be absolutely catastrophic. They are essentially risking their currency to prop up the stock market. That's hard to do. Then what happens if the market continues to go higher. Where does one get back in? I wonder how many people sold everything back in 2012 and 2013 to get out at even from where they were before the GFC and then decided to wait for a nice correction to get back in. They got left behind. I am reducing positions, but I'm adding call spreads on SPY and QQQ on down days going about 50 - 80 days out. I think Dec - Jan should be ok with some more upside. If I'm wrong, then I'll only lose the premium.
Exit if SPX monthly long term minor/major support breaks:- Alternatively weekly/daily if hold period is shorter.
Looking for a "top" in this environment is just foolhardy. Central banks and governments are pumping asset markets like crazy with no end in sight. When large cap index PEs are >100 and inflation is breaking out, then we can start talking about a top.
Better to wait. That being said, don't be surprised if some geo political event happens. Especially if things go usually* quiet, like in the westerns where all the town shop keepers vacate the main street before the gunfight. *Quiet during holidays is normal.