I'm sort of laughing because this Monday is as of 3:15 PM a carbon copy of last Monday only with a slightly larger range. In theory these late day reversals should be negative but as I wrote a week ago (in the comments section) to a reader who asked if that day selloff "meant anything" those rules don't apply when you have premarket magic to make the previous day's bad technical action go away. :) Lo and behold, by Tuesday premarket that ugly Monday close had been forgotten.
So in theory this is two Mondays in a row where we had a nasty reversal. Last Tuesday we gapped up 0.8% in premarket (again on no news) and went on to have a 2%+ gain that pushed us right through the 200 day moving average and closed at the highs of the day. I have no idea what happens tomorrow because all old rules mean nothing when someone with a fistful of bucks can make the market dance to its own tune in the 7 and 8 AM hours.
As I type we have fallen back below the 50 day moving average but still sit above the 200 day. While a not so pleasant reversal, I wrote a few hours ago we are due for some price correction sometime this week. Did not expect it in a "few hours". The market did an awesome job of stopping out a bevy of my short positions right before it reversed... oh cruel stock market.
EDIT - just a reminder the simple moving average (200 day) has moved up from 1108 to just under 1111. Wax Off.
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