The stop hunters were out in full force on Tuesday, taking out the longs seemingly without reason, and no moving averages or support levels were safe from their wrath. But the “shaking of the weak hands” so the smart money can load up for the next move higher is an age-old practice on Wall Street that does serve its purpose well. And when it happens at the 50 dma (where most institutional buy programs are automatically set to go off), it can be particularly destructive for shorts as well, especially those not quick to take their profits. Our Next Day Move algo predicted a SIDEWAYS move for the session, and admittedly after the open I started thinking that the formula needed tweaking, but sure enough here we are back at SPY 235. TVO is headed back down, but now IO with repeated values looks to be reversing course, so although HG favors the bears on this one, the bulls are starting to gain traction. -MD
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