The number of markets that central planners are still able to push up is getting fewer and fewer by the day. While the Dow continued to make a new high on Thursday NQ sold off hard for the second day in a row erasing 10 days of rally. The bond market has been selling off hard spiking interest rates across the board.
Deflationary forces is just beginning to overwhelm the best effort of central planners, even during a very bullish period of the year. Unless they are willing to create more currency and risk hyperinflationary currency collapse, the stock and the bond market selloff may starts to get more intense.
On the short term time frame, key price level NQ support on Friday will be 4740.
-- If NQ could not break-back above 4740 selling could come back in. If so, the next support is 4700, then 4650 double-bottom support.
-- Trading back above 4740 could keep seller at back until NQ can get back up to 4800 where heavy selling could come back in. NQ would need to break-back above 4800 to trigger some short-covering.
With deflationary forces getting more intense, battling central banks buying activities, we can expect high volatility market situation to get more volatile, creating more frequent wild market swings.
