Bearish Reversal Setting Up

This has probably been one of the most unexplainable market rallies of our time. Of course when you realize the Fed has added unlimited amounts of funding to the financial market with no care for inflation, and even signaling negative interest rates in the near future, well, I guess, I can see where the market might like such a thing. 

You also have the Robinhood bros that are piling in their stimulus checks and unemployment compensation into the hottest stocks on the market like Tesla (TSLA), Roku (ROKU) and Wayfair (W) hoping to get instantly rich.  

But what they are not doing is managing risk, and that is the only thing you should ever concern yourself with in the stock market. You either protect yourself to the downside or you eventually lose, and lose big.

Right now, everything in sight is bullish:

• More Covid deaths: Bullish
• More job losses: Bullish
• Shrinking GDP: Bullish
• Small business shutting down permanently: Bullish
• Inflation: Bullish
• Adults doing cringy TicTok vidoes: Bullish and still Cringy
• China and US Trade Starting back up the trade war: Bullish
• Ending the Trade War: Bullish. 

Yes, trade talks are rallying the market along today despite 15% unemployment, because, of course traders have to YOLO into their SPY OTM Calls and make bank, am I right? 

But below you have another story unfolding, the SharePlanner Reversal indicator suggests that people are fighting at bullish extremes for less and less gains. What happens when that occurs? The rug gets pulled. Look, traders as a whole do not make money. Right now they are, but that has to end at some point, because unless it is “different this time” (and it never is), these people are going to have to spill their blood into the streets in the form of their hard earned capital (and gov’t money too).

Here’s the SharePlanner Reversal Indicator: