It is of note today that sentiment came in at 97% Bullish. Is that a sell? No, it is confirmation of the trading low. Yes, it may augur some corrective trade after the big up move. To clarify: I have been writing that the Black Hole Ebola Low in Mid-October is important. That was ages ago-But, it was a Tell and also an interim Low.
It told of a very bullish market in that it came back so quickly and made new highs. That was Bullish. And, since it was a Black Hole pattern it would likely represent a bottom for some time. That information placed the recent sell off as only a relatively minor correction and was a fractal of the decline into Mid-October.
It should have ideally lasted a few more days but it didn’t. However, the context and color of it was that it would resolve into an Xmas rally that could be explosive. I am always amazed at the market moves ahead of expectations. I am not surprised by yesterday and that looks like, as advised, a precursor to more upside.
The constellation of upside potential last from 1/1 into 1/5 which lasts over some holiday trade. Still, if stocks spike up into there, it looks like a trading fade. They would need to rally into it though. In fact the most surprising near term outcome would be for the Xmas seasonals to propel them higher from the S&P 1970 trading low sharply higher into there.