Expectations

This is just a random non-technical post but merely meant for observation purposes. Many readers here are also following all the other financial blogs out there, primarily slope, evil, acetraders and maybe even xtrends (poor guys there).

The one thing that strikes me is the big disconnect many are having. I remember very clearly that 2 months ago many were in the same camp of bearishness with only a few here and there calling for higher prices. From my perspective we have seen quite a change in the financial blog world. Not only do we have quite a few bulls with us now - but the price levels that many are calling for are getting to quite extreme levels. Regardless of who is bull or bear, converted bull, short term bull, bear - whatever you want to call it. Almost everyone has price targets of at least 150-200 points away from where we are today.

Everyone knows what my price targets are on the downside and I still hold to those numbers as they are fit fundamentally and even technically. However, as you know me I keep targets more focused on the short term and where we see ourselves in a few weeks, at most a month out. Many other authors and blogs have been quite similar in the past and we are currently seeing quite a different tone. No one is really focused on our surrounding prices anymore. By surrounding I am talking about the key GAP at 970, the 1014-1022 range or even our key support at 870. All I read is 1150+ (with some even going into the 1200 range). Very few are even considering the 870 or even the 800 range on the lower side.

The other thing to consider is that many of the blogs we frequent have been primarily bearish, and still are, but we are seeing a larger number of bulls, converted bulls and traders choosing to minimize capital exposure and remaining on the sidelines. No one can deny that this market has been extremely difficult to trade, yes easy money has been made on the long side, and bears are continuing to get the shaft on any attempt to short this market.

Why am I saying all this? The end result is pretty clear to me, there does not seem to be a single person out there that is confident in where the markets will move this summer - yes we have some stubborn people that keep on shorting but I would not necessarily consider that a call for market direction but more a gamble to be able to try to get in at the top.

Overall - I have no idea where we may head, we are faced with a large overhead supply that at this point has only materialized through sideways action but could turn out in more upside. Additionally yesterday represented the lowest SPY volume day of the year. When looking at the markets on the 1-min chart we see price moves limited to 30-60 minutes of the cash hours and remain totally flat after those moves are over. Consider this - we are at key resistance and key levels and the market is able to stay within 1 point range for more then one hour - something we have not been able to see in over 2 years time.

I want to tell myself its the quiet before the storm but that again is just another justification for a point of view that had losses written all over it.