Over the past couple weeks with buyers stretching the tape to the upside it appeared that this 200 day tap was inevitable. In fact the Dow and SPX have both touched the 200 day and I expect the NDX to do this sometimes this week. One cannot dent that it appears this rally is pressing upwards until the shorts get squeezed and the fund managers have to chase. This is now 8 straight green candles on the SPY chart and many are on the sidelines (Including myself). This rally did not let anyone in.
So what now? With this extension we now have some divergences that are going to matter and this 200 day MA is not going to be a joke. WHAT HAPPENS HERE is what matters.
If we are above the 200 day then we are long. If we are below then we are short. Keep it simple!
Just Climbing the Wall of Worry and Picking the Right Time to Get out of the Way. I am a Nuclear Engineer who quit and has studied global and crypto markets for almost a decade.
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