Last night the SP500 imploded, creating a huge open gap in its wake. The big question is, “When will the gap get fill”? If I was very bullish then chances are good that this gap will get filled this month but if a bigger bearish picture is emerging then this gap could stay open for many years. For now, I think the gap will remain open but not all indices produced open gaps.
We have many different tops with the SP500 at the 2960 price level producing a great looking double top as well. If the gap stays open by the end of this week then the gap could hang around for a long time. The gap will become important far into the future, but then the majority will have forgotten about it as well.
The Trump tweets caused this gap as at the same time the VIX exploded. Just goes to show how Social Media can damage a so-called bull market.
Social Media is “Mob Rule”, as emotional investors decided to unload after the tweeting action of a President!
What this move did show is that the Gold/SP500 ratio hit 2.3:1 this morning which is the second most expensive Gold/SP500 ratio since September 2018.