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Breakout And Retest?

Published 09/19/2022, 03:01 AM
Updated 07/09/2023, 06:31 AM
US500
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US2000
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QQQ
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AAPL
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VIX
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SMH
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This week is big – 3900 held, Mr. Powell gets to talk, the economy looks dour and after all the declines the VIX cannot even get above 30 the last few weeks and not above 40 all year.

We have all been anticipating a bigger decline but the VIX has been a huge head scratcher for me – no shock and awe. Are people so lured into the Fed being the market stick save? Certainly enough recent history to suggest that may be true and bears getting taken to the woodshed again and again.
Is something else going on? Are we missing something? If you have money on the table, we are all learning to discern market changes better and extract money out of the market in front of us. I caught the decline this last week and closed the puts on Friday.

A bigger concern is what I am starting to see in some of the charts. There seems to be a decline, breakout and retest for the Russell, S&P 500, Apple (NASDAQ:AAPL), QQQ ETF and SMH ETF – I believe they are self-explanatory but given that we have 3 more days before Powell speaks it makes sense to offer these now.

Russell 2000 cash index

Russell 2000 Cash Index

S&P 500 cash index

S&P 500 Cash Index

Apple

Apple Inc Chart

QQQ ETF

QQQ NASDAQ 100 ETF Chart

SMH ETF

SMH Semiconductor ETF Chart

I see charting as a bit of an art and as such I welcome serious critique in the comments. As we approach Wednesday, remember, when an animal is cornered, that is when it really fights and we know the Fed is cornered. I certainly may be charting poorly above, comments welcome, but it doesn’t seem to suggest we are going lower sooner and the Democrats certainly don’t want it going lower before the election cycle is done with. So, it appears that this coming Wednesday may be a lot bigger than anticipated. Choose wisely!

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