The collision of global markets and social mood

Thursday, November 6, 2014

Lollipop Or No?

Today is Draghi day. All ears await the ECB press conference starting at 8:30 am EST for any word on more stimulus, this time in the form of Fed-style QE.

Pathetic.

Notice the market could do nothing of consequence on its own yesterday except fail to get above its previous high, missing it by a mere 77 ticks after trying all day.

And yet both Investors Intelligence and AAII show bearish readings that are back to multi-decade lows? Thus people are wild-eyed bullish of a market that can go nowhere without its training wheels.

And so they wait for Uncle Draghi and his lollipop.

European stocks were showing hope earlier, and futures seem unsure. Meanwhile the daily chart of the S&P has an ominous set up for a potential Island Reversal top.

The market can probably deal with lower prices, but a gap lower could be the kiss of death.

While not terminal, getting below 2,000 might upset the apple cart near term. Depending on how much sugar is in the lollipop though, trend line target/resistance is at ~2,035+.

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