That's the difference between where the S&P was Tuesday morning, when I warned "The Joke's on You if You are Buying this Rally" and where we are now. We had a small sell-off at the open but then back to rally mode into the Fed but now that the Fed is done, we're back to shorting and I just (7:44) put a note out to our Members for some shorting levels to watch on the Futures:
By the way, I'm liking TF short if they fail 1,050. Lined up with 17,750 on YM, 2,075 on ES (also a short) and 4,685 on NQ – you know the rule – the other 3 have to be below and we stop out if one crosses over. /NKD 19,500 also a short if they cross under (and the others are under).
As noted Tuesday, we expected a bounce to at least 2,040, which was a strong bounce per our fabulous 5% Rule™ and we were right there at Tuesday's close but the Fed's mild rate cut and doveish outlook kicked it up a notch into yesterday's close but, as noted by David Fry:
There’s a major disconnect between Yellen’s rosy view of the economy.
In that regard she often repeats her ongoing view of economic conditions as “solid” and any negative conditions as “transitory”. Yet economic data over 2015 remains quite weak. Just today gross Mortgage Applications declined (-3% vs prior +0.4%); Industrial Production fell (-0.6% vs prior .04%); PMI Manufacturing Index Flash fell (51.3 vs prior 52.6) and Crude Oil Inventories rose sharply (4.8 million bbls vs prior -3.6 million bbls). The only gain was an increase in Housing Starts (1.175M vs prior 1.062M) and permits aren’t valuable since many don't move to “starts”.