New moon this coming weekend and the seasonal geomagnetic model peak.
Skew continues to flag an imminent correction.
Small caps are at historic overvaluation.
Source: Martin Pring
Margin debt to GDP: 1987, 2000 and 2007 all gave rise to waterfall declines.
Source: Martin Pring
Investors Intelligence sentiment. A 6 month double peaked concentration of excessive bullishness, like 1987.
Source: Ed Yardeni
Liquidity negative spike as per 2000 and 2007 peaks.
Baltic Dry Index collapsed again.
The solar maximum has waned sharply.
I’m feeling confident that this is finally it. It’s been a 7 month topping process, during which we’ve seen extreme indicator readings and negative divergences develop, margin debt, hot sectors and the solar maximum peak out, and two distinguishable peaks behind the scenes. I’ve been able to publish 100+ charts warning of the top between December and now, with some of the latest charts filling in the missing gaps.
Small caps and European indices have already broken down, leaving US large caps to now join and complete. Large caps may potentially overthrow to new highs into the coming weekend’s new moon but if so it will be on negative divergences and unsustainable. Thereafter we tip into negative lunar pressure and August to October provides the seasonal backdrop to market falls, due to the seasonality of geomagnetism. A congregation of indicators suggest the sharp falls will erupt in this period.
I’ve done my best to produce a cross-referenced multi-angled case for why this is a (i) stock market peak that will give way to (ii) waterfall declines within a new (iii) bear market. If you are sceptical about it, you are right to be: until price turns down definitively then it’s just theory. But it’s the strength of the case which gives me the confidence – once large caps break I will be looking to add short with stops and build in as much as possible, on top of the existing short portfolio. It’s another decade until the next solar maximum, and I see this is as a golden opportunity.