After falling down more than 3 percent last night, ES Futures are now back in the positive region, making about 70 points rise during the past few hours.
Just look at the RSI, close to 100 for that long time. And look at the Bollinger Bands... All very very impressive.
Sentiment on Bubble Vision has definitely turned bullish. Everybody is smiling and welcoming how the ECB might be behind this and saving the markets and how the Fed will come up with a solution.
Let me remind something to my dear readers: HOPE is not an investment strategy.
Will that mean that we have capitulated and bottomed, or is it again a sign of bottom fishing, bargain hunting, über bullishness? We'll see, but this amazing 7% parabolic rise reminds me of the massive 8% rally that markets experienced when the TARP was first announced, just for them to collapse 1-2 days later.
The markets might be climbing in the hope that the Fed's meeting taking place today will bring some more QE and more hope and confidence — as this is the only thing this market is based on.
Or markets could drop, while waiting for the Fed's next move to be announce. To be honest, that would be expected scenario if you think markets are scared...
Whatever happens, I'll be expecting a reversal after Bernanke's speech.