Looks Like The Market is still Trying to Build A Base

Seeing continued market weakness, this morning, as expected.

Yesterday afternoon, I tweeted that this market seemed to have legs, when we saw buyers continue to come in at the 3700 level, and no doubt money is being put to work at certain levels, but that doesn't mean we're off to the races.

As I stated in yesterday's update:

"...were likely to see some giveback in certain European markets,

and that may spill over into US markets"

I also stated:

"Monday, we saw money put to work, which is exactly what one would expect, going into a new quarter, ahead of an election."

And that's all true, BUT there's something else that happened Monday morning!

Some hedge funds must have thought it would be cute, to gap the NASDAQ up - above resistance - and set a bear trap, in order to cause another short covering rally, which was absolutely unnecessary after the massive move we had already seen on Thursday.

Manipulators gonna manipulate, because this is what manipulators do. They aren't going to wait for the market to build a base. This thing has Jim Cramer's finger prints all over it, but all the hedge funds rig markets the same way, and when you see markets gap up, or down, for that matter, there's usually some key technical level being taken out.

This

$COMPQ - The NASDAQ - 30 min view - They raised the bid on the NASDAQ above resistance, leaving a nasty gap behind. This is typical Wall Street dirty tricks

Of course the solution is to go back and fill the gap. 1 step forward, 2 steps back, or vice-versa.

FAANG

We were already seeing FAANG stocks sold at yesterday's open, but it's hard to say if that's going to continue, with NetFlix up, and Apple holding it's own.

$NYFANG index - was sold at the 20 day moving average. This was the perfect place to fade the gap

As you can also see, on the chart above, we may currently only be consolidating in wave "4".

It may not be until next week, that we see the market correct, but that all depends on the $VIX, which is still riding pretty high.

Speaking of the $VIX

I saw Bloomberg talking about the high $VIX yesterday, but they would be better off not trying to explain things that they don't understand.

China

China continues to crash. There's something the MSM likes to ignore. The 2 year bear market in China, and 14 years for Hong Kong! That's right the 2018 high, was rejected, at the 2008 levels.

Isn't this the same Chinese market that was suppose to lead the global economy into the future?

What are the controllers planning next?

Are they going to de-list American traded Chinese stocks, as they did Russia?

And why is it, that Australians apparently got the memo, but not American investors?

4 years in the making! Take a look at a 5 year view of the Hang Seng

I wonder what ever happened to China Bull Jim Rodgers. Last time I saw him, he was being interviewed by some unkempt, stoner, who was broadcasting from his kitchen.