Here it comes, everyone! The day we’ve all been waiting for. Sequester day! :confetti everywhere:
Every hour you can see more and more articles coming out about how the Senate rejected a deal and we are getting closer and closer to the final hour of “doom” and how a deal is unlikely. Perfect.
The final hour of trading today validated everything I’ve been saying all week. (Not gonna lie, I was sweating most of the day with my short positions, but, hey, I ended the day in the green and that’s what this game is all about)
Today was a quintessential bull trap and the sellers know this. I’ve been saying it since Monday, the sellers are waiting for the final moment to sell because they knew Bernanke was gonna push this market higher all week. Why not sell when prices are highest? And that’s exactly what they did today and that’s exactly what they’ll do tomorrow. The bears these days are smart money…they know the most profitable time to sell will be at the last minute.
No deal will be made tomorrow and finally the markets will react. SPY’s complacency stems from the market’s numbness from the fiscal cliff drama. When the news hits the tape confirming no deal, the VIX will arise from its slumber. Be ready.
Daily Chart of SPY:
I maintain my SPY target for the week at 148.
Happy Sequester Day!