still riding the 20 DMA; bears angry, bulls speechless
Only short today, but I think it could be worth.
OK, so we had a broad sell off on Wednesday 13 but it was on relatively low volume. As you can see on the chart of the S&P 500 the 20 DMA held so far and the neckline of a possible bullish inverse Head and shoulders formation is being retested at the same time. If it holds the target would be around 1050 (870-666 = 200. 870+200= 1070). The momentum indicator RSI has never been overbought and continues to remain above 50. Will we continue to ride the 20 DMA...?
The bears are jumping in with the house money, because "roar" now we will finally fall below 666 and slaughter all those bulls like camistocks and become filthy rich. The possible buyers on the sidelines (trillions of money held as cash from mutual funds and Hedge funds) want to wait if there will be a retest of the 666 low.
Contrary to what the "smart" bears say there are only very few "stupid" bulls in the market. They have been surprised by the continous rise and always hoped for a correction to get back in. Bull markets in the early phase try to rise with as little people on bord as possible and destroy as many bears as possible.
There is a saying that goes: in bear markets everybody loses, first it's the bulls, then the bears.... ;-)
Jesse Livermore, the famous speculator made and lost entire fortunes twice. First he made $3 million (in old dollars) in the 1907 crash selling short, but then lost 90% of it again. He later declared bankruptcy. Thanks to the WW1 bullmarket he regained his fortune and continued to make money in the roaring 1920s. In 1929 he noticed that there would be a bear market and shorted stocks. His fortune grew to $100 million in 1932 during the Great Bear market. However somehow he managed to lose most of his fortune and was bankrupt in 1934! He then suffered clinical depression and in 1940 he shot himself in a toilet in a hotel bar...
So, let's see if the supports hold and we continue to stampede ahead riding on the 20 DMA...