Unwind time.
The selloff we saw from the gap open Monday until basically the close yesterday was mostly a result of investors either liquidating or hedging ahead of the CPI. These positions now need to be unwound quickly.
Now we get to observe what the unwind will be like as we gap over resistance.
There is a powerful pattern shaping up here on a break of resistance in both the Nasdaq and the S&P.
Should we get follow through into the end of the week, which is what our increased long positions taken prior to the CPI release yesterday are betting on, then August goes back into vertical rip for the remainder of the month mode.
Here is the NDX as we get set to open:
Two steps to rip the still beating hearts from each and every bear's chest for the remainder of this week:
- Market closes today at or above Monday's high.
- Market follows through on Thursday and Friday, closing the week well above Monday's high, confirming the break of resistance.
What this will do is directly target NDX 14,000+ for August. That is an 8% move up from here.
Very doable.
Very realistic in the face of investors who have missed this rally completely, now having to play catch up.
Enjoy the ride.
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