And Then … It’s Gone
How do you know it’s a bear market?
Sharp up moves like yesterday, only last one day … if that much.
We’re talking specifically about the bond market and the BOE announcement … the effects of which have already faded.
It feels like the 2008, meltdown only 10-times larger.
Remember, there’s no money left to save it (the market) this time.
Yesterday’s update discussed the potential for biotech SPBIO, to rally … which it did.
However, when looking at the daily close chart of SPBIO ($SPSIBI) below, we see that price action stopped right at the confluence of two trend-lines.
Biotech SPBIO, Daily Close
Next, we’ll look at the leveraged inverse fund LABD.
It was a stiff whack downward; then again, price action is confirming a trend … and potential channel.
SPBIO, 3X Leveraged Inverse LABD, Daily
The lower trendline does not look like much.
However as noted, it’s rising at approximately + 5,900%, on an annualized basis.
It’s 15-minutes before the open and LABD, is up about +3.87%, in the pre-market.
For today, the lower trendline is the one to watch.
A decisive break (and close) below this line signifies the current move is over and there’s something else at work.
Yesterday, the LABD-22-05, position was reduced by about 8.5%, to maintain margin requirements (not advice, not a recommendation).
As has been an on-going plan for this trade, position size (in LABD) will be increased as the market allows (not advice, not a recommendation).
Charts by StockCharts
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The Danger Point®, trade mark: No. 6,505,279