To The Moon

Questions For You：

Will you trade Rebound as this point？

Do you have confidence in following 2-3 weeks‘ increase？

1. What Happened on Wednesday?

The U.S. dollar index retraced from a high level. The previous day, the U.S. dollar index continued to brush a 20-year high to 114.78. As of press time on the 29th, the U.S. dollar index was at 113.25. $Invesco DB US Dollar Index Bullish Fund(UUP)$ .

Recommend to Read: US Dollar Index (DXY) Has Peaked Or Not? They Say...

All three major U.S. stock indexes $S&P 500(.SPX)$ , $DJIA(.DJI)$ ,$NASDAQ(.IXIC)$ closed up about 2%. $DJIA(.DJI)$ and the $S&P 500(.SPX)$ closed down for six consecutive sessions.

Check specific tickers:Bear ETFs: $S&P Biotech Bear 3X Shares(LABD)$ , $Direxion Daily Small Cap Bear 3X Shares(TZA)$ , $Bloomberg Crude Oil Bear 2X ETF(SCO)$ ,$S&P 500 Bear 3X ETF(SPXU)$ , $Nasdaq100 Bear 3X ETF(SQQQ)$ ,$Dow30 Bear 3X ETF(SDOW)$ ,$S&P 500 Bear 2X ETF(SDS)$ , $Semiconductors Bear 3x Shares(SOXS)$ see big drop. 

Bull ETFs: $S&P Biotech Bull 3X Shares(LABU)$ , $Nasdaq100 Bull 3X ETF(TQQQ)$ ,$Direxion Daily S&P 500 Bull 3X(SPXL)$ , $S&P 500 Bull 3X ETF(UPRO)$ ,$Bloomberg Natural Gas Bull 2X ETF(BOIL)$ ,$S&P 500 Bull 2X ETF(SSO)$ , $Semiconductor Bull 3X Shares(SOXL)$ ,$FTSE China Bull 3X Shares(YINN)$ see huge increase。

Multiple technical indicators suggest U.S. stocks may be oversold, but many on Wall Street worry that investors have yet to price in slowing earnings and the Fed's rate hike.

You may interested in read: Data Track: Unusual Oversold Stock Market, When Is Time To Buy?

Among ETF options, the sell-off in put options hit a four-year record, according to a Barclays analysis, suggesting the market is not yet at its most bearish.

Source: https://ycharts.com/

On Wednesday, the market was extremely oversold and the PUT/Call Ratio was extremely high with a volume reversal.

2.Will this Reversal Continue? Distinguish the Two voices:

1. The current market is still uncertain.

As the US dollar index fell in the short term, but it will rebound, and the heavyweight $Apple(AAPL)$ is still falling.

Analysis of history, although 70% of the stocks on Wednesday were up, while the previous three similar situations showed that the 1.99% gains of $Invesco QQQ Trust(QQQ)$ on Wednesday were not that strong as before.

Compare to 2008 trend, the current market is still under many potention drop risk.

The market value of the Russell 3000 index has evaporated by more than 13 trillion US dollars during the year. Inflation, raw materials soared, prices soared, global trade has slowed down due to the impact of the epidemic, and raw materials are tight. Concerns about recession in the global economy cannot be ignored. The Fed’s interest rate hike may peak next year.

Therefore, in the context of a tightening recession, corporate profitability will decline, and the “US stock market carnage” in the medium term is not over yet.

2. Short-Term Rebounce Continues 

Technically Analysis, The broader market and individual stocks have been seriously oversold, and some analysts said Wednesday's rebound is bound to reverse the 5-session losing streak.

Source from 𝐁𝐫𝐚𝐧𝐝𝐨𝐧 𝐕𝐚𝐧 𝐙𝐞𝐞,Co-Founder:@MarketScholars

The $SPX daily candle chart shows had 5 straight oversold Market Forecast clusters, That it incredibly rare. The last time we had it was during the Xmas swoon of 2018, when we had 6 in a row. So far, so good on Wednesday, looking like the decline will end if the markets stay up.

A professional trader friend who did not want to be named revealed to TechnicalMaster that they are going long recently. Taking $Invesco QQQ Trust(QQQ)$ as an example, the MACD and Bolling 2h trend lines shows that the short-selling kinetic energy is exhausted. The adjustment of the panic decline has been completed on Tuesday. The historical MACD and kinetic energy columns show that more short-term rebounds are coming. 

This is the era of master trading. Long positions remain in place ahead of the October earnings season. According to the observation of chip distribution in the early stage, the rebound of $Invesco QQQ Trust(QQQ)$ in the early stage of this round may be at 316 points. Whether this key point can be broken through will determine more upward space.

Otherwise, it will also usher in a short-term correction. In any case, prefessional traders trying survive by licking blood at the crossroads with a combination of long and short strategies.

Investment is risky.

This article does not serve as a direct investment recommendation, but is for communication only.

Wish you a healthy and happy investing.