I don’t have any above 60% chances tricks, all of them have stopped working for awhile, as I said before, that probably implies things are different now, either up huge or the trend is turning down.
The most noticeable thing today is CPCE closed at 0.55 while CPCI closed at 2.06. The more reasonable explain should be that retailers are bullish but big funds see more risks and therefore are hedging their positions with index options. So this kind of readings should be treaded as bearish. The chart below shows what happened recently when we got similar CPCE and CPCI readings. I know the occurrences are too few to draw any solid conclusion. But let’s just keep watching this kind of situations, maybe eventually it’ll turn out to be a reliable tricks…
And yes, the NYMO sell signal I talked about the last night, was confirmed today. According to the past patterns, more likely, either the market will drop sharply from here or the short entered today gets stopped out within a day or two. Let’s see.