S&P Midcap Intraday Review: Still Leading!

Last month the Midcap futures contract hit a major peak. It has since been rolling downhill followed with about  a  2 day rally. I would love to see my wave 2 top hold, but we have to keep our choices open, just in case it can still rally to my previous “B” wave top.   Some indices do  take the lead while the rest of the planet is focusing on the record highs that the DJIA and the SP500 have been making.  

It’s the classic magician trick, by causing a distraction in one area, the real decline could be well advanced in other less known indices. I’m sure the same thing will happen at any major bottom when the long term base can give us an early bottom before anyone clues in. 

At the 2009 bottom the Midcaps were at 400 which left no room for any major 5 waves to still play out. At the same time they were screaming DOW 1000 yet the exact opposite happened. From a 400 base and the worst fundamental conditions the markets performed a miracle and started  to rise. It ended up being the biggest market rally since the depression, leaving the majority scrambling to get out while they should be doing the exact opposite. Insider buying had already been in full swing by late 2008, so a bottom was already fast approaching.

Insiders made their mass exodus in May of 2017 leaving the retail investor holding overpriced assets as they head into the markets. In the long run they will pay the price as the concept of buying low and selling high is a strange idea to most.