Dow Blows Engine Room. Rescued By Naughty Bear. Burry Winds Down Fund.

What a difference a day makes!

We’ve moved from Dow attempting its personal moon shot while S&P, Nasdaq, and Uncle Russ attempt to outwit each other in a backroom game of Cripple Mr Onion to Dow suddenly realizing he, in typical red shirt Mr Scott fashion, who “just hasn’t got the power” and “I’m giving her all she’s got!” before blowing up the engine room of the good ship “Bull Run.”

Forcing everyone to hit the lifeboats only to be rescued by the Titanic’s little known sister ship “The Naughty Bear.”

Uncle Russ was leading the bear charge all along and finally we may see this pesky range low target. Will it totally tip over though and deliver a full on corrective move?

Mag7, AI, Quantum computing all seem to have stalled and the bubble that was propping up the markets seems to have lost some of its mojo.

The government is back like a new Voldemort plot in a Harry Potter spin off and he who must not be named is back at contradicting himself.

The crash oracle Michael Burry, in a double plot twist, has decided to throw the towel in and winding down his fund because he doesn’t understand this market. Are we looking at the top? Could this be a real time real world left turn in what will inevitably be “The Big Short 2.0” coming soon to a cinema near you? Stay tuned!

Anyway, back to my short term setups.

SPX reclaimed the bull AVWAP and as mentioned earlier in the week can be used to manage positions without needing to wait for TnT setups. I’ve also taken a speculative bear swing which is working out just fine at the moment.

I’ll be working on automating the signal setups for this old and reworked setup as I rebuild my software suite.

Over on RUT, the same setup can be seen with the AVWAP showing the range pinch before the eventual breakout, so a standard breakout entry can be taken for a bear swing and also used to manage the bulls in the same way as SPX.

All in all things are looking good. I just wonder if we will see a huge bull turnaround before the Friday finish again? Stay tuned.

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SPX Market Briefing:

Friday November reviews what-a-difference-a-day-makes journey from Dow moon shot attempting personal space mission to red shirt Scotty engine room explosion “hasn’t got power” forcing lifeboat rescue by Titanic’s sister ship Naughty Bear,

Uncle Russ leading bear charge all along (range low target approaching, full corrective move question), Mag7/AI/quantum bubble lost mojo, government back like Voldemort plot contradicting himself,

Michael Burry plot twist winding down fund because doesn’t understand market (looking at top, Big Short 2.0 signal?),

SPX reclaimed bull AVWAP managing positions without TnT wait (speculative bear swing working fine, automating signals whilst rebuilding software), RUT same AVWAP setup showing range pinch before breakout (standard bear swing entry, manage bulls like SPX),

wondering if huge bull turnaround before Friday finish again.

Current Multi-Market Status:

• ES: 6743.00, engine room blown

• RTY: 2382.6, leading bear charge

• YM: 47,481, red shirt Scotty failure

• NQ: 24,972.00, quantum bubble deflating

• CL: $59.44, slight recovery

• GC: $4200.0, giving back gains

• VIX: 21.21, volatility spike from 17.70

• 2yr Bonds: 3.587%

Dow Blows Engine Room – Red Shirt Scotty Can’t Save It

What a difference a day makes!

Yesterday: Dow at 48,393 in outer space, NATHs baby.
Today: YM 47,481, nearly 1,000 points lower.

We’ve moved from Dow attempting its personal moon shot to Dow suddenly realizing he, in typical red shirt Mr Scott fashion, who “just hasn’t got the power” and “I’m giving her all she’s got!” before blowing up the engine room of the good ship “Bull Run.”

Star Trek fans know: When Scotty says “I’m giving her all she’s got, Captain!” the engine room is about to explode. Classic red shirt moment.

Yesterday’s solo moon mission? Today’s catastrophic mechanical failure.

Current Status: Dow engine room exploded, Scotty couldn’t save it and a random red shirt took one for the team, 1,000 points lower

Rescued By The Naughty Bear

Forcing everyone to hit the lifeboats only to be rescued by the Titanic’s little known sister ship “The Naughty Bear.”

When Bull Run’s engine exploded, passengers abandoned ship. Lifeboats deployed. Chaos ensued.

Rescue ship arrives: The Naughty Bear. Titanic’s little known sister ship. Presumably learned from Titanic’s mistakes. Still not ideal rescue vehicle given family history.

Market participants fleeing into… bearish positioning. The irony.

Current Status: Everyone rescued by Naughty Bear after Bull Run explosion

Uncle Russ Leading Bear Charge All Along

Uncle Russ was leading the bear charge all along and finally we may see this pesky range low target.

RTY: 2382.6 – approaching that 2391 target zone from the daily chart setup.

Uncle Russell wasn’t wobbling. He was leading. While everyone watched Dow’s outer space adventure, Uncle Russ was quietly positioning for bear charge.

Will it totally tip over though and deliver a full on corrective move?

Range low target approaching. Question: Does it bounce here or break through for full corrective move?

Mag7, AI, Quantum computing all seem to have stalled and the bubble that was propping up the markets seems to have lost some of its mojo.

The narrative stocks stalling. NQ: 24,972 down from 25,605. Tech bubble deflating. Quantum computing hype paused. AI mojo lost.

Current Status: Uncle Russ leading bear charge, range low target approaching, tech bubble deflating

Burry Throws Towel – Big Short 2.0?

The crash oracle Michael Burry, in a double plot twist, has decided to throw the towel in and winding down his fund because he doesn’t understand this market.

Michael Burry – the guy who predicted 2008 crash, made famous by “The Big Short” – is winding down his fund. Reason: Doesn’t understand current market.

Are we looking at the top?

Historical irony: When legendary bear capitulates, is that the actual top signal?

Could this be a real time real world left turn in what will inevitably be “The Big Short 2.0” coming soon to a cinema near you?

Plot twist worthy of sequel: Burry throws in towel right before massive crash validates his entire thesis. Hollywood couldn’t write better script.

The government is back like a new Voldemort plot in a Harry Potter spin off and he who must not be named is back at contradicting himself.

Political chaos continuing. Policy contradictions mounting. Voldemort-level drama.

Current Status: Burry winding down fund, potential top signal, government contradicting itself

SPX AVWAP Management + Bear Swing

Anyway, back to my short term setups.

SPX: 6737.48 down from yesterday’s 6850.93.

SPX reclaimed the bull AVWAP and as mentioned earlier in the week can be used to manage positions without needing to wait for TnT setups.

Bull AVWAP reclaimed = management level active. Don’t need to wait for PFZ trip. Tighter control.

I’ve also taken a speculative bear swing which is working out just fine at the moment.

Bear swing entry taken. Working. No elaborate explanation needed.

I’ll be working on automating the signal setups for this old and reworked setup as I rebuild my software suite.

System improvement continues. Automating signals. Rebuilding suite.

Current Status: SPX bull AVWAP managing, speculative bear swing working, automating signals

RUT Same Setup – AVWAP Breakout Entry

Over on RUT, the same setup can be seen with the AVWAP showing the range pinch before the eventual breakout.

RUT: 2382.98 – AVWAP range pinch visible. Compression before expansion.

So a standard breakout entry can be taken for a bear swing and also used to manage the bulls in the same way as SPX.

Bear swing entry: Standard breakout below AVWAP support.
Bull management: Same AVWAP approach as SPX.

Current Status: RUT AVWAP pinch, bear breakout entry available, bull management active

Friday Turnaround Question

All in all things are looking good.

Despite market chaos: Setups working. Management in place. Systems functioning.

I just wonder if we will see a huge bull turnaround before the Friday finish again?

Markets have habit of Friday reversals. Big sell-off Thursday/Friday morning. Then magical turnaround into close.

Will it happen again? Stay tuned.

Current Status: Things looking good, wondering about Friday turnaround magic…

Trade well,
T2 Markets

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