TAPE has lost its rhythm ?

There is such a thing as "logical moves in markets"......

BUT ...we have lost total control on any sense of logical moves....

What i am trying to point out, that there has been totally irrational movement in TAPE....

In a span of six weeks we have gone down from 2019 to 1820 in 18 trading days and then we go from 1820 to 2018 in last 12 trading days which is either a loss of 198 points or almost 11% in both moves....

I personally have not seen a move of this type ever in quick V formation.....maybe historian will look @ this when it points to something major ?

To make a point, we need to be careful when TAPE is this volatile, either supercomputers have taken charge or something is brewing which is not normal.

Now to market, we need to digest gains of almost 198 points in S&P 500.....which may mean pulling back to 50 DMA for support or even to 200 DMA for major support.

IF we don't pull back soon then the slump will be more severe or intense.

Some former leaders have not fared well in earnings like FB & TWTR which is not a good sign....

TAPE is in some kind of flux as most stocks are not faring well.

Oil & Gold are making multi year lows which is not a good thing.....

Coal & Base metals are not faring well which does not speak well of China recovery.

All in all "caution" is required.....

Most pundits are extremely bullish, which generally does not pan out.

SO..it is back to stock pickers market, as most are not acting well.

Good luck with your diversified approach.

BLOG does NOT give buy or sell.

Saleem

Posted in: Mixed