The most confusing aspect of a high volatility market phase is that it has a knack for roping in bulls and bears alike, especially the dumb and inexperienced ones, i.e. the vast majority. Yesterday’s session was a textbook example and all the other charts I am going to post below are beautifully summarized by none other than our much beloved Zero indicator:

Equity futures pulled an NFL yesterday judging by the complete lack of participation throughout the big roll over day into the 2018 March contract. Fairly unusual at least in my (not so) humble opinion, and it seemed as if everyone rolled (or perhaps not) and then simply walked away.

The equity market in particular has become extremely good at luring and then trapping people into highly volatile reversals. Which especially is true for those rare moments when we may be tempted to  trade against the prevailing trend, which of course continues up, up, and then up. Given the increasing number of traps placed in front of us on a weekly basis I have a hard time imagining how anyone could succeed trading equities on a long term basis without the aid of some sort of participation measure (a.k.a. market lie detector) as for example our very own Zero indicator: