Monday 5 October 2015

11am update - sure, its overbought

On the micro 5/15/60min cycles, all US equity indexes are clearly way overstretched, with the sp'500 having ramped 84pts (4.2%) across just 8 trading hours. Equity bulls could sustain brief cooling to the 1950/40s.. and it would in no way negate last weeks powerfully bullish weekly candle.


sp'60min



sp'weekly1b



Summary

Seen on the bigger cycles, it should concern those resolutely holding short, that there really isn't any key resistance until the sp'2040/60 zone.

Who wants to hold all the way to there?

For the 3x leveraged ETFs, that'd equate to another 4%.. x3.. 12%.. plus.. add in some decay of say 3%... so.. thats 15% downside... probable.

For short dated option puts... they'd effectively be zeroed out.

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I could reel off a list of a few dozen key stocks that are all showing hyper-bullish candles to start a new week.

Suffice to say.. bears failed to contain the latest bounce.. and we're headed seemingly much higher across earnings season.
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*for the moment.. and probably the rest of this week, I have little interest in getting involved... not least on the short-side.

The next decent short-side trade doesn't look viable until at least 2000... and I'd really not be comfortable unless 2050/60... with the latter being some weeks away.
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notable weakness: AAPL, -0.4%...