This Is Not Investment Advice
The Market Right Now - Risk On/Off
Obviously Risk On has encountered some substantial trouble here right as this newsletter was raising more warning flags and itself deploying a cautious approach and the use of more protection.
So where are we now? One way of looking at that is to say we are wobbling and flapping a bit in between various potential support levels and EMAs. In fact - it’s plausible that we spend some time with an EMA considered by the cheerleaders to be “an impossibility” perhaps.
Let’s take a look at some stretched out Daily Charts with the good ole’ 200 EMA Daily plotted along with a quick look at the Nasdaq overall.
Nasdaq General Market Indicators
IWM Daily
QQQ Daily
RSP Daily
Thoughts and observations:
As depicted clearly above IWM made 6x touches and RSP made 5x touches on 200 EMA Daily . . . . and that is just in the last 12 months . . . . . the 200 Day is not a far fetched sci-fi cloak and dagger mystery in the markets and investing . . . . it comes into play and can even be considered common in my humble opinion . . . . .
Nasdaq looks to be plunging more aggressively now and with Higher Volume than it did in late October when I last flipped to Risk Off . . . . . open mind . . . .
What is very important and potentially inbound is the following . . . . . what does Risk On do if/when QQQ and others start testing the 200 EMA Daily . . . . . is there a bounce . . . . . consolidation . . . . . would say another High Volume move down below 200 EMA Daily would be very bearish and keep the market in Risk Off until resolved . . . . . if that were to occur . . . . . we do not know as of right now in my view . . .
Open mind . . . . . .
75% of stocks follow the overall market trend . . . . .
Open mind . . . . . plunging towards the 200 EMA Daily could be just the warm up act . . . . . could be setting up a consolidation . . . . . could be setting up a bullish reversal . . . . . we simply do not know . . . . . we do know Higher Time Frame Money Flow is generally not bullish right now . . . . we also know the Nasdaq is under heavy Distribution . . . . .
