ES Morning Update March 9th 2020

It sure feels like the market is crashing but technically it’s not. These 1000+ point moves in one day used too be called flash crashes but now they are normal everyday swings… pretty crazy, that’s for sure. I had a FP on the QQQ of 193.79 that I can’t seem to locate on my hard drives right now. But I did put a horizontal trendline on my chart to mark the level. I had completely forgotten about it as the market went up enough in the past 6 months that the trendline disappeared off the screen.

It could still be seen on the yearly chart but I didn’t use that time frame too much to watch the QQQ’s, so I forgot about the FP level. We’d hit a low of 193.64 so far this premarket morning on the QQQ’s so it’s basically a completed FP as sometimes they pierce them by a few points and other times fall shy a little.  It’s funny how back on March 6th, 2009 we bottomed for the entire drop from the 2007 high and here we are just around the same day and could reach a temporary bottom if the FP is accurate. Back then the 6th was a Friday and the 9th was a Monday… just like now.

I’m not sure if this is “the low” or not but I wouldn’t be shocked to see a big move up off it start very soon as this kind of move down it likely to get the Fed’s to step in and buy up the market with some QE or something. I’m sure the “Greed and Fear” index is going to be buried to the fear side when the market opens today, and the put to call ratio should be very high. Let’s not forget that the VIX is going to spike at the open too. It should be a crazy day in the market with very big and wild swings.

It looks and feels like a capitulation move to me. But it’s really all about the Fed’s stepping in to help or not, as if they don’t then we have much lower level coming. I think they will step in today sometime to stop the bleeding. From there we’ll rally hard for awhile. I have no idea whether they can get it up to make a higher high, double top or just a lower high. I’m sure everyone will short the rally on the way up trying to pick the top, and that certainly makes sense to me.

A lower high is what I’d look for as well, but it certainly doesn’t like to give traders what they expect. So, I’ll just NOT try and call it right now. First let’s see if the Fed’s step in or not and go from there. Try to preserve capital if you can as I’m sure there will be another great opportunity in the near future. God Bless all us gamblers.