US Equities on Edge of Cliff...and Bears in Valley are Hungry
I am saving this idea here partly for myself so I can look back at it later and hit "Play" to see what transpired versus what I expected.
MY CURRENT SITUATION: On this Sunday 08/25, ES is down over 1% in after hours trading. My NQ short positions are well in profits at this moment. My positions were opened close to the upper range of the bear flag.
NEWS: Trump just escalated trade war with China by increasing tariffs (and hinting at possible State of Emergency declaration to allow ban of US good sales in China) after China retaliated Friday morning to previous US tariffs before the Fed's Jackson Hole event. As expected based on my bear flag shown in the chart above, markets started to fall hard Friday after Trump provided the downside catalyst via twitter about retaliation to be announced.
TAKEAWAY: Since news that Tariffs at 25% are going to 30% and tariffs at 10% are going to 15% did not happen until near the close on Friday by Trump via Twitter, and further negative G7 developments with that event still underway, I am predicting further downside on Monday 08/26 to confirm the bear flag I have drawn. If this additional downside takes us below 2728, I see a swift move to the downside in the 2319 region where I do expect a reaction. If we get there, i highly doubt that level will hold for long. This will be the start of the next bear market in US equities, and possibly the greatest bear market of our lifetimes. I see 1584 on the ES as a probable bottom for this next bear market, although I would not be surprised to see a momentum fueled overshoot to about 1500 on ES before that bottom is confirmed.
MY CURRENT SITUATION: On this Sunday 08/25, ES is down over 1% in after hours trading. My NQ short positions are well in profits at this moment. My positions were opened close to the upper range of the bear flag.
NEWS: Trump just escalated trade war with China by increasing tariffs (and hinting at possible State of Emergency declaration to allow ban of US good sales in China) after China retaliated Friday morning to previous US tariffs before the Fed's Jackson Hole event. As expected based on my bear flag shown in the chart above, markets started to fall hard Friday after Trump provided the downside catalyst via twitter about retaliation to be announced.
TAKEAWAY: Since news that Tariffs at 25% are going to 30% and tariffs at 10% are going to 15% did not happen until near the close on Friday by Trump via Twitter, and further negative G7 developments with that event still underway, I am predicting further downside on Monday 08/26 to confirm the bear flag I have drawn. If this additional downside takes us below 2728, I see a swift move to the downside in the 2319 region where I do expect a reaction. If we get there, i highly doubt that level will hold for long. This will be the start of the next bear market in US equities, and possibly the greatest bear market of our lifetimes. I see 1584 on the ES as a probable bottom for this next bear market, although I would not be surprised to see a momentum fueled overshoot to about 1500 on ES before that bottom is confirmed.
Comment:
Looks like a double top instead, but i do see a possible H & S forming on QQQ.