Bottom Line:
Next week is the last week of April.
Since March 31:
- The SPX is up .59%
- The NDX is down 1.37%
- The RUT is down .61%
- The DOW is up .62%
That is three weeks of chop, overlap and non-directional rotation, ie….”Balance”. It is one of the primary precepts of Auction Market Principles that markets develop and constantly transition from Balance to Imbalance to Balance in an endless loop, and in all timeframes.
Even market breadth is “Balanced” and likely to soon break and trend (see below)
How do you know when a Balance Area is “mature” and about to transition into Imbalance (a strong trend)? There is no way to know. However, as a Balance Area in a given market becomes “obviously” mature, and I consider three weeks obviously mature in the stock indices, you do want to start orienting your trade strategy and tactics towards looking for initiative market behavior. The easiest way to recognize initiative market behavior is to be alert for wide range directional price bars.
Pay attention to and do not fade price that trades through the levels highlighted below.
Not losing money is underrated. Trying to force trades to make something happen never ends well. Almost all traders (hand raised) could use more patience. Not trading IS trading.
SPX
NDX
RUT
DOW
Internals
Closing NYSE breadth since March 31 perfectly reflects the price action of the same tmeframe. There has been NO directional conviction, up or down. We are soon going to see either a significant expansion or contraction in breadth.
30M Breadth
Breadth has been negative since last Tuesday’s cash open, but has traded in a narrow range. This is more evidence of an imminent significant move.
VIX
VIX has spent more time below 20 since October-November 2021. IF we are still in a bear market it is very likely we are near a top of significance.
US 10-yr Notes
US Dollar
Gold
Crude
