Good Day and I hope you are well.
comment: Max bearishness last Friday but markets refuse to go down and take tariff risks at face value. Q2 earnings will tell the story so buckle up. Earnings season kicks off in about 3 weeks. Until then the next big event will be in 8 days when 50% EU tariffs may or may not come into play. Until then I don’t expect a big move to the downside, since bears tried couple of times but market refuses to go down. The big upper channel line runs up to 25000 and that is the next obvious big target. For bears it’s a break below the bull wedge and retesting 23300.
current market cycle: bull wedge and on the weekly tf it’s a broad bull channel and we are at the very top
key levels for next week: 23000 - 25000
bull case: 25000 is the next big round number but I highly doubt we get there. I was wrong last week and until we leave bear gaps behind us, bulls are favored for everything because the reality is that buying every dip has been profitable for months now. Bulls have to keep printing higher lows though.
Invalidation is below 23300.
bear case: I doubt we have much more upside in store but we could very well spike to 25000 before we can expect more bulls to stop buying every dip. Bears get spikes and zero follow-through, which leads to many bear traps. Scalping both sides was fine the past 2 weeks but bears have to take quick profits or they vanish quickly. Bears need a daily close below 23300 for more downside and until then, swing shorts are account destroyers. We need a big gap down which does not close to stop the BTFD crowd. So if we get a decent one next week and market only corrects sideways, that will be the trigger for more selling.
Invalidation is above 24500.
short term: Neutral. Scalping both sides but I will only turn full bear with an open bear gap and a daily close below 23300.
medium-long term from 2025-05-25: My rough guess from early May was down over the summer and up into year end. POTUS certainly helped with the 50% tariffs. Markets were not positioned for any risk what so ever. Now we got the atomic trade bomb. This view has not changed, just the time horizon which aligns better with Q2 earnings and my expectation that we will see the tariff madness coming through. Markets can ignore risks for longer than you can maintain your account but that does not change the reality and if you think this tariff war has a happy ending, you have not paid attention to anyone but the US government or their echo chamber.
comment: Max bearishness last Friday but markets refuse to go down and take tariff risks at face value. Q2 earnings will tell the story so buckle up. Earnings season kicks off in about 3 weeks. Until then the next big event will be in 8 days when 50% EU tariffs may or may not come into play. Until then I don’t expect a big move to the downside, since bears tried couple of times but market refuses to go down. The big upper channel line runs up to 25000 and that is the next obvious big target. For bears it’s a break below the bull wedge and retesting 23300.
current market cycle: bull wedge and on the weekly tf it’s a broad bull channel and we are at the very top
key levels for next week: 23000 - 25000
bull case: 25000 is the next big round number but I highly doubt we get there. I was wrong last week and until we leave bear gaps behind us, bulls are favored for everything because the reality is that buying every dip has been profitable for months now. Bulls have to keep printing higher lows though.
Invalidation is below 23300.
bear case: I doubt we have much more upside in store but we could very well spike to 25000 before we can expect more bulls to stop buying every dip. Bears get spikes and zero follow-through, which leads to many bear traps. Scalping both sides was fine the past 2 weeks but bears have to take quick profits or they vanish quickly. Bears need a daily close below 23300 for more downside and until then, swing shorts are account destroyers. We need a big gap down which does not close to stop the BTFD crowd. So if we get a decent one next week and market only corrects sideways, that will be the trigger for more selling.
Invalidation is above 24500.
short term: Neutral. Scalping both sides but I will only turn full bear with an open bear gap and a daily close below 23300.
medium-long term from 2025-05-25: My rough guess from early May was down over the summer and up into year end. POTUS certainly helped with the 50% tariffs. Markets were not positioned for any risk what so ever. Now we got the atomic trade bomb. This view has not changed, just the time horizon which aligns better with Q2 earnings and my expectation that we will see the tariff madness coming through. Markets can ignore risks for longer than you can maintain your account but that does not change the reality and if you think this tariff war has a happy ending, you have not paid attention to anyone but the US government or their echo chamber.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.