The 50 DMA has to hold this week and CONgress must act quickly or this sucker is going to roll over even harder with a quick test of the 200 DMA around the 4300 level. That would mean certain doom to all of the phony baloney good time dope smoking rock and rolling permabulls.
The markets were floundering upwards on light volume just like the dead cat bounce we just witnessed then the new broke just before 2 p.m. EST that the Omicron variant of the China Virus was found in San Francisco. I know, it’ shocking that a city like that with people pooping on the streets and shooting heroin up in front of children on sidewalks has detected a new disease variant, but I digress.
Of course the news got the blame for this:
But wait a minute. The news broke at around 2 p.m. but the selling into the rally started just before noon. Something doesn’t add up. Then again the volume bars in the last 2 hours of trading were large and in charge, just like yesterday’s monster day indicating that this was not the Hoodies selling but large institutions liquidating before year end to pocket their profits.
Maybe Jim Cramer can have the military arrest those who disagree with the CNBS/FakeNews narrative or something, but charts don’t lie like he does.
Thus, basic math, something no longer being taught in school should tell everyone that there was a 139 point decline in the S&P 500 from its highs of the day, equal to an almost 1200 point Dow Jones Industrial Average move if we still had real markets.
Hence the “oink” of the morning where everyone wondered about was sold into heavy and the news gave the winners a chance to liquidate their holdings even further. Although some insiders were ahead of the move and have been for months now, as Wolfstreet.com reported today:
Perhaps they know something we do not, unless you’re among those of us who have been paying attention. The 50 day moving average was blown up and now the 200 DMA is in play. The market’s next move is in Nancy Pelosi’s hands now.
Isn’t that reassuring?