First, a mighty boring day on Monday, not completely unexpected give our quick run-up on Friday. EEdge-Trend and EEdge-LRE at least kept us on the right side of the market (above), too bad it wore me out early and I walked away to do other chores. Not worth the risk to keep involved after this floating market.
One thing this boring market allowed was a brief look at the longer term picture which is interesting.
The chart here is a daily chart, or a 1440 minute (Tradestation thing, 1440 minutes in a day) and a few things stand out. First, we've been in a big uptrend (no kidding, right) but our timing suggests that we may have a sideways or down swing correction in the works here. This topping is a usually a process not an event. Note the Price Exhaustion (cyan dots top of price action) and the Volume Exhaustion (yellow dots) showing up on our EEdge-Volume indicator (all EE by the way). The buying has dried up and at least for now there's a big divergence of volume. We also have an incredibly soft VIX which closing levels haven't been seen like this in a couple of years, but in general are at some of the lowest in the last 10 years. Really scary, eye opening stuff. I'm starting to hedge a bit on my longer term investments awaiting the black swan to come swimming up behind me and bite me in the ass. 95 million Americans not working, worst recovery of any recession since the 1940s, wages down $17,867 per household per year since 2007, (Source: Economic Policy Institute, you can't make this stuff up [NeverHillary]) entitlement mentality on the rise with no signs of waning. Something's gonna blow. Don't get me wrong, I always like to be in the direction the market is going, at least short term and without question that is up. BUT what goes up must come down and the FED has no place to go. I think we're so inflated and when the correction does come I think it will be because of a lack of buying up here, not really active shorting, at least at first. We are a herd after all and like moths to a flame we'll blindly chase this thing time after time and any down moves at the moment are still a pullback in a bigger term uptrend. It amazes me looking through the Tweets from traders that many are obsessed with calling a bearish or bullish move that is coming any minute now. As followers know, I don't care what way it moves, I don't care if the markets proves me right. I simply want to see what direction the market tendency is and go with it. Yes, reversals are possible at any time and we can even stab at some of those, but I'd rather be profitable rather than have my ego stroked. My charts and the EEdge Indicators are screaming at me at the moment to "Trade What You See, Not What You Think". So I'm gonna try to do just that...
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