Is 2930 the TOP of this 'FAKE' Wallstreet Rally?

Markets can stay irrational longer than you can stay solvent.

That was my feeling for the most part during the past few weeks, as I see record unemployment numbers in the USA, with economies all around the world locked down, with all signs pointing towards a long period of economic uncertainty for businesses due to the COV19 situation...

Wallstreet continued to trade higher and higher, day after day, week after week...

Until now... which is the reason for this post.

Previously, we warned our members about the multi year resistance node on the DJIA ( 28520.20 - 28869.88 ), which preceded the outbreak of COV19 from Wuhan.

We have also highlighted the likelihood of a strong bounce when we hit Critical yearly support nodes at 18567.51.

Now here is my next warning.

In my opinion - the worst is yet to come, for the markets, and for the global economy.

The COV19 virus is more contagious than you may have been led to believe, and the health consequences are far more serious than what the mainstream media is telling you. The timeline for a vaccine is likely 12-18 months. Economies are trying to reopen but in most cases we are witnessing a second wave of new cases once social distancing measures are eased. 

The combination of the above factors - means that the impact on the global economy, and businesses.... will likely drag on, through this summer into winter, and for the foreseeable future.

There is no short term fix.

However, as a Professional Trader that have been actively trading the markets for the last decade - I do not trade based on my opinion. We trade based on our technical tools, and our tools gave us a our first sell signal in weeks.

We have been warning our Weekly Focus members about the importance of resistance node 2930 ( on the Emini S&p futures ), for several weeks now.

Price has been interacting with that resistance node in the past few trading sessions, and finally earlier today, we broke to the downside.

Our technicals - stop grabber against F5(2930) gave us this signal that it was time to sell into this market.

The difference between us and the talking heads on TV - is that we are traders, not economists... we do not seek to predict what the future is going to be, or how the markets will trade. We act on we believe is going to happen, guided by our technical tools...

And our tools suggest to us that today might be the beginning of what could be a substantial move to the downside - at minimum to retest the recent lows, and possibly break it. If our technical signal is invalidated - we change our view.

But for now - I'm sticking my neck out by saying here - to expect significant downside pressure to hit wallstreet in the coming days/weeks.

So this is yet another warning to investors.

The recent stock market rally that we have been seeing in Wallstreet has started to run out of steam... Watch out!

Many of our members, including myself, have built up a short positions earlier today, in anticipation of this move lower.

If you would like to gain insights to how we mange to nail major market turning points, (safely) again and again and again, I'd like to invite you to join our Weekly Focus Membership today.

We are currently offering a limited 14 day Trial - which you can access by hitting the subscribe button... This offer will soon end, so do take advantage of this offer while you can.

IF you any questions - you can reach out to me at [email protected]

Stay safe

Joseph AuXano

DiNapoli Trading Academy