Dow 30 Mar 19 to Mar 23 Outlook

Recap
Y+1 did nothing at all in stopping Dow from going higher. The next higher resistance at around 13050 was blasted thru after shorts was trapped by the bearish Fed announcements and then squeezed hard by the sudden announcement from JPM shortly after. Why time it right after Fed announcement is a mystery to me. But algos all went wild in real time and scrambled to cover shorts was a real sight to witness. Dow closed the week near its high.

Outlook
Remember STOPD gives us a clear target whenever market shock happens – the next breakout target at 100% expansion. We got that last week and going sideway since.

Next week should be a consolidation week after the shock and a pullback to Y+2 downto B-0 is normal.

Shorts are licking their wounds and is not likely going to participate in buying / selling in coming weeks. Even long term hedge funds will have to re-evaluate their strategies given the way how messed up the financial markets are at this point. We are witnessing extreme market manipulations done everyday to the stock market and no one is held responsible.

Money is definitely better put to work elsewhere so I expect further dry up in liquidity from this point onward.