There was some short-selling ahead of the opening bell on Thursday for the 30th anniversary of the 1987 stock market crash. People’s Bank of China Governor Zhou Xiaochuan warned against a sudden slide in optimism that could trigger a jolting collapse in asset prices, a Minsky Moment.
Clearly, the Fed is not going to let that happen as buy programs hit the market immediately after a short bust of selling at the open.
But the stage is now set for more selling to come as topping action gets closer to completion, eventually culminating in a crash likely just like the crash of 1987.
On the short term intraday timeframe, key price level for Friday will be 6100.
-- A break-back above 6100 is likely to trigger some short-covering, targeting a break above recent swing high before selling come back in.
-- Failure to break back above 6100 could attract more selling, but Friday tends to be choppy sideways pattern type of day, so we can expected a sideways trading pattern unless it breaks below Thursday swing low that is accompanied by bearish market internals
