Carry trade is the ulimate goal
think like big money
If you consider the amount of money some entities have, it makes sense that the carry trade is the best trade for them. In trading, retail traders want/need/crave volatility. We need the market to swing from highs to lows and carry a trend.
Big money is the opposite.
They fight for the carry trade, the yield, the low volatility. They want to sell insurance, so to speak. They want to hold their huge cash stock pile in an asset that barely moves and pays them a low risk yield on a consistent basis.
They are buying the super lows, they are inching into positions.
This is the mode we are in right now.
With this in mind, we are near a staring at a breakout level here around 5263. I think unless we can take out 5223 on the downside, we are likely to see dips bought and breakouts higher attempted. Eventually it will give. Is that today? IDK. All I can do is be prepared for either scenario and align myself with the context.
If you remember the theme from last week is we are in a period of low vol, which I stated Friday before last.
Here:
This should continue until 5/17, and probably until 5/22 when the last of the big shorts in the market are set to expire.
If this 5263 goes, it can see 5276 and 5288.
If 5245 breaks early, the lowest I see is 5230 and 5223. This is a fringe possibility in my opinion.