"As soon as you think you've found the key they go and change the locks."
-a traders lament
My first reaction on reading this was "It's a set-up".
From Dana Lyons' Tumblr:
For the past year or so, we have been discussing the stock market’s recent tendency to form V-bottoms after declines. By that, we mean that stocks have more or less immediately returned to the previous highs as quickly as they sold off. This is in contrast to the more traditional complex bottoming process involving a bounce and retest. As defined by the parameters we’ve outlined, we identified 8 V-bottoms just since the beginning of 2013. That is 1 every 2-3 months. For perspective, we identified just 38 such V-bottoms in the prior 62 years, or 1 every 1.6 years.
At the depths of the October selloff in stocks, we surmised that while perhaps the worst of the selling was over, the market may be in for a more complex bottoming process considering the extent of the damage. However, in an October 31 post, due to the S&P 500’s swift recovery back to its previous high, we announced that “The V-Bottom is STILL in Fashion”....MORE
HT: The Big Picture
