During this mounting crisis in Europe, there have been repeated “lifts” in the market, appearing out of the blue and for no particular reason, to counter hard sell-offs. We had yet another one last night, and I suspect there will be dozens more to come. This is truly the 2022 version of “Trade Talks with China Are Going Well.” The desperate need to keep the illusion of prosperity alive will compel these countervailing forces to act.
If you step away from the myopic one-minute view, however, you can see the steady stair steps that have been working their way lower. As exciting as a fabled “crash” might be, I actually find it far more manageable to have a market grinding away like this, disappointing both bulls and bears alike as it continues to confuse.
The feces would really hit the fan if the low from one month ago was taken out. The Fibonacci Retracements continue to do a pretty good job of defining support and resistance (and indeed, the chart above shows the repulsion from prices last night was almost exactly at the Fib level). The ES, shown below, never threatened its 2022 low, but Nasdaq 100 Futures did briefly cut below its own.
The only two assets that have been celebrating the events in Ukraine have been oil and gold. Oil, shown here, hammered out a well-defined basing pattern, and once it breached the neckline (arrow), it was off to the races.
Of more interest to me is gold, whose ascent I always applaud. Recently, it has enjoyed two important breakouts. We were mired at $1,800 for such a long time, but now it seems comfortably above $1,900 with an eye toward “the big two.”
As I’m typing this, the ES is barely down at all, and the /Russell 2000 Futures is actually in the green. I’m in 43 different bearish positions, and as always, I’ll manage them one by one. I will say, however, that I’m more comfortable managing this kind of morning than I would be if the market was, say, down 100 on the /ES futures.