Weak ADX knew ahead of time to expect spike in Volatility!

Average Directional Index was in a very weak trend which signaled beforehand that we could expect some choppiness. The market was trying to decide which way it wanted to start trending towards again, which is why it was so easily swayed. We should have known how information sensitive the mkt already was and sat back and thought. Looking back now, the more powerful narrative being told was a negative story and not a good one which would have exploited or strongarmed this weak ADX trend into a strong negative trend.

This was a very unique scenario. All the variables aligning at once leading to the fastest correction in history!
1) Very weak ADX trend.
2) Coronavirus fear
3) Mkt priced for an “extreme” best-case scenario
4) Mkt pricing in an “expected” rate cut leading to earnings growth
5) Investors being rather complacent and almost unfazed by coronavirus risk

Beyond Technical AnalysisChart PatternsTrend Analysis

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