In the market Thursday we had a big short squeeze in oil with a corresponding squeeze in stocks as most of the the trading algos are keying directly off oil futures right now. It started early on and to give the squeeze a little more kick they sent out Fed hawk Bullard to make some dovish comments. Is this a second try to make an S&P 2000 backtest run or did they just throw the breaks on the downtrending market long enough to clear off some of the short interest and we simply resume the downtrend tomorrow?
click on image to enlarge
Looking at the two sixty minute bar charts above, we can see that today's monster squeeze did not break the S&P nor the NASDAQ out of its recently steepened downtrending channel. Everyone will be watching to see if they can put two up days together, or even better, three. We will see...
Trade well my friends