MARKET ENVIRONMENT: by Woody Dorsey. Sentiment is coming in today @ 74% Bullish. Markets remain in a bid flow! There are buyers hanging around. They are ignoring, for now, the structural Tightening Campaign which has a long long time to go. The profile is still for a Hyperinflation. But, Stocks remain in an expected Recovery. Is the Ukraine bout between Vladamir & Vladimir already discounted? Has all of the damage already been done?
NEAR TERM: Stocks maintain a bid bias as they continue to confirm an interim recovery. They have entered into a lazy indeterminate period but do have upside into late April.
INTERIM TERM: An expected Interim low occurred and the profile remains for an April recovery. There may then develop an extended complex Summer Topping process, B4 a ‘Fall Fall.’
DORSEY MARKET SENTIMENT: Sentiment discovered support after responding to a level of panic pessimism. But sentiment rebounds are already working on registering a new level of optimism. It is becoming a bit frothy again as war stories and rate rises are being discounted.
MARKET SUMMARY: Equity Markets remain under secular pressure but are having a normal price recovery. Central Bankers will be grappling with potential Hyperinflation for some time. Volatility and Uncertainty aren’t going away. Embrace it. An April recovery process continues and may churn into Summer. There will be another leg down after that. War never ends well, nor will, 2022.
TECHNICAL VIEW by Gary Dean: The bears are trying to get the spx below the first line of support (4550) If they succeed, I am expecting a test of the 4500 as well as my downside target at 4450/4400. But so far we have seen the bulls defending support levels and there is no downside momentum. It could happen anywhere up here and make sense, but until the 4550 is taken out, the bulls remain in short/intermediate term control. This does NOT make me bullish on this market from a bigger picture, just a little cautious short term. Another push above the previous rally highs may very well come with bearish divergences on the daily.
The bearish divergences did case a 130 point drop, but the bulls stepped in at the 4500 level and that is where the bears need to get through to see any downside momentum pick up. The range is 4640 high and 4504 low.
The short term pivots are 4590 and 4640 resistance/4540/4500 support. Waiting for a break of this short term range is the safest way to trade for now.
Summary: The bulls did run out of steam, but the drop was very fast and bid back up just as fast. I am still bearish on this market, but my caution radar is flashing. G
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Information is for paid customers and may not be copied or distributed Copyright 2022