Mexico City Stock Market Bomb Scare

As one of our members pointed out, there was a bomb scare in Mexico City's Stock market. Searching Reuters, who seems to have broken the story, the earliest reference I can find to it was at 3:14 pm our time in the market-Here's the Story.


Looking at the chart below, you can see a red arrow at that exact time.

A sell-off like that, similar to a rally like that, near vertical, has the earmarks of a computer trade program, it may or may not have been, in either case we didn't get the all clear until  Reuters released a follow up at 3:45 which correlates with the SPY price of $107.15. The trend line drawn in red across the chart shows the lows of the day and where likely stops were placed, thus all the volume. Once the SPY moved below that level sell orders were triggered and filled. I can't say that this is not helpful to smart money in accumulating a position as we had seen Friday and today, however, with all of the orders needing to be filled, a recovery back above the $107.30 area (the trendline) I guess was an unlikely chance.

The SPY hourly which may not be fast enough to react, shows no real damage done to a potential bounce.

Here was the flag, an upside continuation pattern that I mentioned, the question is, would this have broken out to the upside had the Mexico City Stock Market Bomb scare not have occurred?

Right about where we'd expect a breakout and about the time smart money starts working in the market, we got this scare.

All indicators get a little whacky inside a consolidation like a flag, but looking at the 5 min 3C to uncover the trend, it seems pretty clear that it was holding up fairly well.

It's conjecture, you can come to your own conclusions, but I'm going to guess that we would have closed higher. Now I'll need to start over. This is nothing like 9/11, but these types of events are totally unforeseen (at least we hope they are) therefore it's difficult to analyze them and put them into context.

We have the last half of Friday and about half of today contributing to accumulation in the market, we don't know how much of that position could have been sold off in the late afternoon, so this kind of puts me back to square one with analysis. I'm going right back to work, looking for signs of anything helpful and I'll put anything I find in tonight's wrap up.

What a strange occurrence.