Another reason to be worried is that all-time highs earlier this week came with significant cumulative breadth divergences. Once again, this is not a signal in itself, but lasting highs without such a divergence are rare. These are all things typically seen late cycle.
Today generated a Hindenburg Omen observation for the first time since March. This is not a timing signal for any selloff and, the odds of a selloff, while elevated, are far from a sure thing. However, it's a call to watch for other signs that a top might be forming.
@SquawkCNBC Perhaps a more thematic musical trivia question for this morning would be which band put produced the 1982 classic Industrial Disease. https://t.co/UaKTrDapjq
The market is trying to erase cumulative breadth divergences which appeared at the last several all-time highs. Let's keep an eye on NYSE breadth through the end of the day. Even if they can erase divergences, +800 or so on breadth isn't a great way to make a new high.
Taking a break from markets this week. Taking a break from my break to let you know Voodoo Lines is part of the July 4th sale at @simplertrading - if you’ve been wanting to add this tool to your charts you can do it at a discount with code JULY25 https://t.co/2SSe9Yu0y3
For longer-term positions I'll wait to see if a move down begins to show the patterns associated with a trend move. So long as it doesn't I'll stay long. I have no idea what will happen -- I just have a plan. We'll be trading it live Monday in the Voodoo Mastery room.
Our trading agenda for Monday is now clarifying with a U.S. air strike on Iranian nuclear facilities. From the perspective of markets, it doesn't matter whether a situation traders were worried about happens. The only thing which matters is how the market reacts after.
We'll some reaction in futures Sunday night, but I care most about price action during Monday's New York session. Traders, like politicians, need their red lines. Mine is the SPX 5925 Voodoo fireline -- literally a red line. Below that level and I'll exit short-term positions.