At a critical support line.

SPY SPX DIA UVXY Two factors influenced the market this week, the fed interest rate cut, and the new "Global factor" criteria used that makes me question if the inflation, jobs and other economy bounded related parameters used by Janet Yellen aren't supposed to be the metrics that the Fed uses to determine the interest rates, and not the pressures of the political agendas. The market spoke and it didn't like the reasoning. On the other hand, the sensitivity is very high, the trade wars are neither good nor easy to win, and we can see how depressed are the aluminum and steel, which were supposed to be the first ones to win in this "War", both Alcoa and US Steel lost Billions in market cap for it. Oil is trading towards a consolidation, the market is going for protection in bonds which are breaking their 52W high, Gold spiked, which is a sign the market is looking for protection against inflation.

The market has the last word, and if this support line holds we can expect in the best case scenario that a smooth deleverage will happen, which will keep the market bouncing in the range towards the ATH and the current level. BUT ... the big BUT ... if the manipulation tries to mess with critical economy variables then we can expect an overreaction and a sell off that may wipe off the "Trump's rally" ... again. Be careful out there. I expect a rebound from this week, but my gut feeling tells me there is more volatility yet to come.

By the way ... isn't there in the categories one that is called "Gut feeling".