Following significant action in the market Thursday, John Carter of Simpler Options reviews what different areas of the market are indicating. Carter feels the QQQ is a bit extended, and there are a lot of warning signs, particularly the IWM (Russell). Even more of a red flag is TLT (bonds). Not only is it a great bullish chart, but even when the market is sideways or higher, TLT moves slightly higher. When the market is moving lower, TLT explodes higher. So, the TLT is great vehicle for a directional trade or hedge at this point in the market. FXY is also an indicator to watch for market directional. Carter is still bullish MMM, longer term KO.
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