WATCH THE VIDEO for trend and volume analysis.
I am going to make this post short, and the video will also be somewhat short.
Why do I continuously repeat the same process every week, seemingly repeating the same thing I said last week?
The reason for that is if you are preparing for a day or a week or a month of trading, regardless of your style, you need to be apprised of the bigger picture and longer time frames. This week, despite the optimism of previous weeks, still indicates that we are still in a downtrend on MNQH23 and the previous contract, MNQZ22.
Volume is weaker than we might expect for a typical seasonal “Santa Claus” rally and Fed policy reaction to economic news still scares the crap out of retail investors and institutional money. Price action seems to still be a toilet flush or a fountain depending upon what economic data would mean for interest rate policy. ( I realize that bidets are fountains, but think of the typical toilet in an American single-family residence ).
The reason for that is that when greed seems to be the modus operandi of the modern investor, be he or she an AMC PJ’er speculator or a large fund manager, the interest rate distortions government has made while pressuring a valueless currency into further worthlessness by destroying both intrinsic and time value of money make equity and commodity prices malleable with infinite plasticity. Value suddenly matters when infinite U.S. Government indebtedness forces the time value of money to mean something again. If companies cannot earn a return, then why in the hell are their equities priced to absolute perfection? And furthermore, WHY IN THE HELL ARE WE STILL HOLDING THEM?
I have watched all the pundits spew out technical and fundamental reasons why the markets are still in a funk, but one thing to me is certain. Until we understand the degree to which interest rates must rise to crush inflation, we will continue to do this suicidal dance until that rate is finally determined. Sadly, after this election, the same poltroons are pretty much in place, and none of them seems to care that inflation is a serious issue. Only the consumer, who has seen gasoline prices go from $1.80 a gallon to $4.00 a gallon by government malfeasance and seen a dozen eggs go from $1.89-$2.50 a couple of years back to $7.00 plus now gets how bad it is. Until the criminal political class decides to do something rational about it (like unleashing free-market economics again) we are likely stuck in this mess. Y’all voted for these cretins (if you can believe the election process, which a wide plurality do not), so if you did, and the results are real, you got exactly what you voted for. I hope you are enjoying it ( and I know that most of you are not).
At any rate, we are still in a downtrend. That may seem boring to you, but it grounds me as to what to look for in trading opportunities for next week.
More will be coming soon. I am very busy at the moment. I will do what I can to improve the content of this blog. THANKS ONCE AGAIN FOR SUPPORTING THIS BLOG!
