S&P 500 IndexShort
Black Swan Event? Weekly Pattern Is Still Bearish.
Even with the melt your face off rally from the last two days, the weekly pattern on the S&P is still bearish. The current price is below both the 100 and 200 DMAs. Until the market forms a higher low and higher high, I have to consider that the last two days are just noise caused by changes to the rate hike forecast and high negative gamma. The candlestick pattern eerily looks like it's setting up for a plunge with short bodies and long wicks in a descending pattern.
IMO, there hasn't been a higher probability of a Black Swan event in recent memory.
Possible Black Swan Events
1. The Fed pulls a “Volcker Moment” and hikes rates earlier and more than expected.
2. China invades Taiwan.
3. NATO becomes directly involved in military conflict with Russia.
4. A new COVID strain emerges that is as transmissible as Omicron and as deadly as Delta. Existing immunity doesn't provide protection.
On the chart, wave 3 represents an extended wave at 2.618 x the length of wave 1. If wave 3 is extended, wave 5 should be the same length as wave 1.
What do you all think is going to happen next week? Let me know in the comments.
IMO, there hasn't been a higher probability of a Black Swan event in recent memory.
Possible Black Swan Events
1. The Fed pulls a “Volcker Moment” and hikes rates earlier and more than expected.
2. China invades Taiwan.
3. NATO becomes directly involved in military conflict with Russia.
4. A new COVID strain emerges that is as transmissible as Omicron and as deadly as Delta. Existing immunity doesn't provide protection.
On the chart, wave 3 represents an extended wave at 2.618 x the length of wave 1. If wave 3 is extended, wave 5 should be the same length as wave 1.
What do you all think is going to happen next week? Let me know in the comments.
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