The markets have not been a lot of fun and games for the past couple of days, so I thought this might be a good time to play ‘Where’s Waldo?’
For the sake of argument, instead of that trademark red and white sweater and cap that often gives him away, imagine that Waldo is a long red candlestick followed by anything that looks like a strong bounce back week immediately thereafter. Can you find a Waldo that looks like this? While there are many long red candlesticks, I can’t find one Waldo – at least looking at the NASDAQ weekly chart going back six years. Don’t forget that almost the entire period covered in this chart is a raging bull market, so the bias should be bullish and there should be a bunch of Waldos.
How many longs will be brave enough to hold over the weekend? My sense of the current market is that the ugliness continues at least into the first half of Monday’s session, at which point the bulls will have their first chance to show what sort of firepower they still have left.
Disclaimer: I am short Waldo as this goes to press.