October 2000 vs. October 2014

By various indicators, equities in 2014 align well with the last solar maximum year of 2000.

The topping process began in January. The solar maximum occurred in March with an associated speculation peak (margin debt peak, speculative target index peak with p/e>100 (Nasdaq in 2000, R2K in 2014)). A double top occurred in July and September, and an initial washout low in October (capitulative breadth spike >10). All this is captured in these two charts, using the Dow Jones World Index:

30oc6 30oc5

Source: Stockcharts

The July/Sept double top in price was higher in 2014 than the March peak (vs. lower in 2000), but the indicators reveal the topping process proceeding in the same way since the turn of the year.

We can see the top performing sectors align (defensives signalling a market peak):

30oc20

Source: All Star Charts

30oc21Source: Macromon

The extreme high banding in allocations aligns too. The October capitulative low failed to wash this out, just like in 2000.

30oc8Indicators position us equivalent to October 2000 (and January 2008 if we tie in the 2007 peak). Subject to how October closes, the monthly candles look similar:

Screen Shot 2014-10-29 at 15.50.58

The long-tailed candle, rather than being a bullish development, instead appears as the first evidence of real selling befitting the end of a topping process. That makes the rally a rip to sell.

The candle comparison unites with the positioning by indicators (solar max, topping process, margin debt, breadth, treasuries, sector performance, allocations), so it seems right. A negative November looks to be on the cards.

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436 thoughts on “October 2000 vs. October 2014

  1. John,

    Thanks for you work. I love your insight.

    Here is my two cents about some crazy stock market math.

    If you believe in cycles and the way to count them, as I do, then check out this math.

    The longest 4 year cycle advance in the history of the stock market prior to this one was 60 months (2007 and 1987). The current advance is 66 months if we peaked in September. We are about to enter month 68 of total 4 year cycle. The longest 4 year cycle from low to low was 77 months which occurred from 2002 to 2009. The last cycle was the longest by a wide margin. Unless we are going to stretch to a new record (doubtful) this 4 year cycle should bottom before August of next year.

    Here is where it gets interesting. It implies the correction will be swift in time. If we are in a new secular bull market then the low will be above the 2009 low. If we are not in a secular bull but a bear then we will take out 2009 low. Either way this could be one of the most dangerous stock market set ups since the dawn of the stock market. Given this set up the chance we get an epic crash is high given we are running out of time to make a low. There is the chance we stretch but given where QE has taken price I don’t think this will be a long drawn out affair.

    Buckle up this is about to get very interesting.

      1. Interestingly the Rusty, which has been the leading indices along with the DAX since John’s SC top, is has back tested the underside of the upward sloping neckline from the head to right shoulder which also corresponds with the 50week.

        It is also at a decision point. It either overcomes resistance or reverses here. If it reverses and takes out the October lows all hell will break loose.
        US Thanksgiving may be packed full of surprises!

        http://stockcharts.com/h-sc/ui?s=$RUT&p=W&b=5&g=0&id=p21042823067

        1. Allan.

          NO collapse here. Too close to Elections and Christmas. Besides FED still playing games in the background.

          Why sing the song of collapse, collapse, collapse for the last couple of months – for forever already – you lose credibility – smell the roses instead and get real 🙂

          Crash is NOT going to happen till sometime next year!

  2. In the great majority of cases, prognostications about the future – here on this board and elsewhere – rely on a belief that what’s occurred in the past will likely do so in the future, or at least a close approximation thereof.

    So, simplistically but logically readers, why not take the same tack and review what has happened each time the Fed has ended a QE program? Has the market reacted and how? It seems as worthwhile an exercise in extrapolation as any other that has been put forth.

    Unless, of course, you believe, the Fed continues to buy securities contrary to their statement yesterday. There I can’t help you. You’re on your own 🙂

  3. Blue, I expected the bull to end in 2015,
    My take was/is that earnings outlooks
    Will begin to weaken providing traction to
    The downside, however John’s outlook may
    Still prove valid so remaining open-minded.

    I am surprised that the longevity of this bull
    Phase is rarely mentioned, even if you are an
    uber bull, by about any historical metrics we are in
    A late stage bull market.

    1. SS, thanks for this article. I think the author makes numerous leaps of faith in forecasting the Yellen future couching them in certainty rather than probability but laying that aside I myself have wondered how Dr. Yellen’s evident focus on the 95% might play itself out in Fed’s policies.

      I do think she is interested in leveling the playing field which will evidence itself in policies that promote long-term wage growth, higher inflation and employment. (See Paul McCulley’s posts in this regard.) All other things being equal, that means, at the margin, a greater share of the economic pie to labor and less to capital.

      I think the article is, as you say, a must read.

  4. JTTT, mate if you actually knew what amd others here were about you would know that most are not permabears, which judging by your previous posts I am certain is what you are implying.
    Speaking for myself I actually called for a bottom two weeks ago and was looking for a very strong rebound, but of course let us ignore that shall we. Not only that, at that time I warned that the DAX weekly candle reversal should NOT be ignored. However, I call it as I see it and at present I see bearishness is still underlying most indices.

    As for a collapse, a oollapse can last for years and a collapse is not a crash. Also in case you have not noticed, we have yet to make new all time highs in ANY major global index so as Gary just said, from a bears perspective I love to see cockiness of the bulls, who have once again become overjoyed with this latest rally as it augers well for those of us that are bearish and bearish because we see something that makes us bearish and not just beacuse it is easier to run with the herd.

    I will let hindsight be my judge, thanks.

  5. Gary, to paraphrase the great Mr Twain, history does not repeat
    But it sure does rhyme.

    We all know the bull will eventually die just as night
    Follows day, any disagreement is really a matter of
    Timing -and unlike night and day the timing cannot be
    Set by a watch.

    1. But that’s the point of this blog! To try through the efforts of this community to better judge the timing of the death of the bull (or bear as the case might be).

      1. Gary FYI

        The 10 largest crashes by magnitude:

        October 15th 2008: -7.87%
        December 1st 2008: -7.7%
        October 9th 2008 – 7.33%
        October 27th 1997: -7.18%
        September 17th 2001: -7.13%
        September 29th 2008: -6.98%
        October 22nd 2008: -5.69%
        April 14th 2000: -5.66%
        August 8th 2011: – 5.55%
        August 10th 2011: -4.62%

        1. Wow..do you mean the market is higher now than those days? Now, I understand why people believe in going long. Longs will be rewarded by sitting tight unless this time is different.

  6. And Joe may I promptly turn your attention to the DAX whch has, in the last hour, gone from being nearly 50 points up to nearly 100 pts DOWN!

    I say again. The DAX will lead global equity markets to hell in a hand basket before the year is out.

  7. Nope Alan, it will be the US Market that will lead the rest of the world down NEXT year.

    Nothing much will happen for the rest of the year here except for violent swings up and down – and it will end the year on a positive note.

    1. Joe.with due respect how do you draw that conclusion when quite clearly the DAX has been leading global indices including the US and did so into the early October lows and IF you look at the DAX rebound to date, it has been very lack lustre. In fact, as I posted two days ago.Is downright bearish?
      You need to stop thinking that the major US indices are leading this move and understand that this is a global collapse that has been underway in Europe for several months.
      The US WIlL NOT survive this on its own and nor will it hold up the rest of the world or are its major indices leading.

      If you read John’s previous articles you will soon realise that he has nailed the speculative top in terms of the global speculative bubble, which is most obvious in the DAX and R2K indices.

      1. Joe, just to add. The day of the lows in early Oct I was watching both Europe amd US indices very closely and I can tell you categorically that the DAX was the first index to bottom and to begin reversing. Not the US.
        It is the DAX today that reversed and began pulling down US futures as I type. It will be the DAX and Europe that will be the fly in the US’s ointment.

        1. Allan,

          OK I stand corrected re the DAX

          Resistance is at 1990 and next resistance on SPX is 2000.

  8. I personally think the US market is good shape ATM thanks to 4 Trillion being pumped in by the Feds.
    It’s Europe, war and Ebola which will drag the US down rather than the other way round.

    Feds no longer have your back unless another round of QE comes about, please don’t think the US can isolate itself from the rest of the worlds troubles.

    Denial- disbelief – fear.

    1. Aaron, the US markets are in terrible shape.. Last I saw they were the 3rd most ovevalued markets in the world and by far the most overvalued in the industrialised developed world.

  9. I apologise for taking up so much of the forum but this is hugely critical today. The DAX is now just 27 pts away from taking out the critical 8900 level again.
    To do so I believe sets off the most important phase yet of the collapse that began months ago and likely the initiates the waterfall declines that John writes about so regularly.

    1. Allan,

      DAX rebounded and closed – 74

      BTW no need to apologise – I do enjoy reading your posts.. There will be no ‘waterfall declines’ till maybe next year.

  10. Aaron, about half of the $4trillion splurged into the markets, another half is stuck at the Fed as per regulatory requirements banks reserves had to go up. i posted earlier my belief that the major reason for the fed to print was to replenish bank reserves and decrease their leverage. I believe we are far from being done on banks reserve reqs. Per Basel the reqs are to be inreased into 2018 gradually. i saw a stat recently that the current reserve ratio at the banks in the US is about 10%. As per Basel, its could go as high as 18%, depending on a bank! All this cash will have to come out of the market and be parked neatly with the big daddy. I also think that the current market valuations reflect the current amount of money printed already (there are numerous charts that confirm that) and that the yanked cash will continue putting pressure on the asset bubble.

    1. Weaning bulls & corporate america off POMO will take some time. Once reality sits in, market should normalize to 1600ish level

    2. As Bloomberg columnist Jeff Kearns recently quipped: “Quantitative easing may turn out to be a gift that keeps on giving for the U.S. economy.” The consequences of the Fed’s multi-trillion dollar bet will continue to influence markets long after QE3 is forgotten. As a result, fears of another sudden stock market selloff post-QE are likely overblown.

  11. euro/yen hit falling trend line from dec highs. 10 points to go down from here. Same as in January post the Fed taper decision setting in. Let’s see what this does to equity markets.

    1. Well, they stayed down and still the market paid no mind! Crazy. To be fair, the overarching/underlying issue has always been earnings and those continue to be better than expected.

    1. my dad went to the ER on friday and was admitted to the Hospital and passed away late Sunday night…

      the chart that never lies has been bullish since Friday – but may whipsaw here soon.

      with V for debt late fee usury saving the planet this morning breadth is bound to crumble quickly

      1. BBE very sorry to hear about your loss. No matter how much warning/expectation its never easy. Our thoughts are with you.

  12. Chop at the top… tops are very disturbing as hope is diffused in long and tedious process. Better to spend time other way then looking at the markets today.

    On the other hand why is propping stock market until 4 Nov elections so important for them ?

    1. good question. which party will benefit from the market staying high? And how would “they” keep the market elevated anyway?

    2. Honestly can’t believe the U.S. markets this week. Corporate buyback a probably hit a record today. The government should cap buy backs to encourage better wages for the employees and more capital spending but they are so blinded by stock markets representing the state of the economy. Then they complain about wealth inequality. The government really hasn’t thought things through!

  13. Can NOT believe that they turned the DAX around AGAIN after it broke down yet again from the wedge and what would have been yet another horrendously bearish bar on the daily chart.

    Ya think these people don’t mean business to defend paeticular levels think again. At least the bears in Europe now know what DAX level has then S%#Y scared!

    1. If this market is about to rollover – jury out for me at the moment – then I think we can expect more of the “Grand Old Duke” routine Allan.

      I remember the wild swings pre-Lehman’s demise. Lots of money will be made/ lost intra-day as and when this thing finally gives up!

  14. Let’s not forget that the 3.5% GDP number is actually .5 – 1% given that the way GDP is calculated was changed last July. Is it any coincidence that since then US GDP has been significantly improved………NO!

    Also the hand of the Government had a massive influence on GDP last qr., so basically the US is doing just as poorly as Europe, which of course anyone living in the US would actually realise anyway.

    BUT the numbers never lie right?

  15. next week is week number 2 of the lunar edge negative period for stocks. If we don’t start down early next week, I’m thinking it’s not going to happen this year.

  16. net line buy signals and some fairly clear buying pressure mounting in the small caps but iwm is still a lower high and it has rolled over on each similar rally attempt…

  17. any long positions should be treated as pure speculation as the V crowd this morning indicates.

    this is not a market of willing buyers and sellers individually and freely transacting…

  18. I see the BEARS bears are now getting a lot of great support from Greenspan.; according to a piece in the WSJ to wit:

    “Where should investors turn? “Greenspan said gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments,” The Wall Street Journal reported.”

    (News and sentiment are supposed to be bearish near market lows.)

    How low can we go!

      1. BBE, it was time for your dad to go to a better place. We down here are still stuck on this prison planet waiting for more unusual things to happen. Regards.

  19. Closed my ftse longs. Might be a terrible mistake but this rally stinks of manipulation. I’ve got a new motto for the FED…Long live wealth inequality.

  20. SPX 2000 within touching distance.

    Looking increasingly like this was a shallow
    Correction in a continuing bull market.

    Need an immediate reversal here or the
    Bull marches on to 2015 imv.

    1. I didn’t think he was arrogant at all. But the network that had him on is apparently staffed by bozos. They couldn’t get ONE of his greedometer charts up. Not one. They interrupted him to have him talk about the 2014 chart because they apparently found that chart and were going to show it, so he starts talking about 2014, but they couldn’t even get that chart up! Idiots!

      It will be interesting to see if his call for a top within 1 percent of the 2019 high comes in. And did I hear him correctly, he’s expecting a drop of 65 to 70 percent?!

  21. ok folks, pretty normal day so far. QQQ and IBB at record, GILD at record. GDX and GDXJ down their usual 4%-5%. To be really honest, this is by far the easiest market I’ve ever seen. I don’t understand why some people here refuse to play it and insist on being short the stock market. It’s really beyond me.

    1. this has been rumored for quite a while already, i can just see pensions getting wiped out…any reason to go long i guess.

  22. wave 2 retracement % in S&P 500 now in line with 1937 wave 2. # days at 58% or close to Fibonacci target 62%. Metals and Hui starting to look interesting. Reverse of 2011.

      1. Hi BBE ! Don’t touch GDX and GDXJ with a 10 foot pole. This is a secular bear market. I don’t want to brag but my track record is very impressive. I might start an investing blog.

        1. brag away – but at least my posts accurately before commenting

          so maybe learn to read before bragging. lol

      2. The GDX chart sure looks like it’s finishing a thrust down out of a triangle. i.e. final wave down. Also can count 5 within this final wave.

  23. Short set at 2003 on SPX, 100 pt stop.

    And short set below at 1989.

    After seeing it earlier I really did think I missed any chance getting back in as I bottled it yesterday and made a small loss.

    My other auto short is still waiting to hit below gathering dust at 1899., I’ll prob cancel that one out as it looks like it will may never get their.

    1. Price wise in 1937, US stocks had quintupled in value over the previous 4.5 years.

      At the moment, they have “only” tripled over the past 5.5 years. A quintupling (if there is such a word) would see SP500 at 3330. I give it at least an 80% chance that we’ll witness a bubble to that sort of level.

    2. I have us hitting the 62 percent threshold at the rollover between today and tomorrow. So today’s high or tomorrow’s high, assuming one of them turns out to be the top, would make the time expended by the recovery rally = 62 percent of the time the market took to drop from SPX 2019 to 1820.

  24. Slightly down on my new IBB long but, Nic, counting on you and your impressive track record. this is total awesomeness, how could I have switched to the dark side? go Nic and his new blog!:))

  25. so far this market tracks 1937 by price and time as follows: 64% by price based on wave 1 down and 29-32% of time on both wave 1 and 2.
    Assuming the market continues this shadow pattern on price and time wave 3 target comes out at 1469 to be achieved in 20 trading days.

  26. what BBE says about this shit not being life

    as they say “true dat”

    a bunch of colored pixels on a computers screen backed by electrons used by most with little comprehension of what is really happening

    1. the best cure is get outside! Leave the pixels behind for a few hours or a weekend or a week. Go climb a mountain or walk a beach, hang out with friends and family (and get them to turn off their damn smart phones!).

      Hey, I’m talking to you Bud! Who me? Yeah you! Okay, I’m outta here, good evening to all!

    1. Sure looks like it. On the DJIA its dropped back below the top uptrend line that I was tracking. Dots connected were:

      Oct 23rd 16775ish and Oct’29 17060 (my data includes out of hours)

  27. if this isnt the WTF moment it is the penultimate WTF preview

    but the machines have no flesh so they must drink BLOOOOOOOOD!

  28. It works both ways and when it does they can try as many traing halts as they like( which will likely only exacerbate the situation anyways)
    I would not be surprised to see the DAX crap itself again tomorrow.

    Boy oh boy are the bulls cccky!

  29. Given the velocity of this advance, some minor pullback
    Approx 2-4% would not surprise me.

    By mid next month I would not be short unless
    Something dramatically has changed.

    1. retest of the recent lows and then we will see an attempt at a bounce for a holiday rally – pretty sure that fails hard

  30. Followup on fibonacci projection to 2067, deja vu Oct 2007 from yesterday. Noticed the strong reaction to DJTA from trend top from Jul and Sep tops (approximates Calderos 3 year EW trend top from 2011 P2). Same projected top for Thanksgiving is DJIA 17570, SPX 2060, COMP 4730.

  31. When i discovered this site i was so glad

    i thought i had discovered a bunch of really smart people

    only thing i’m thinking now is that i’m such an idiot

    but perhaps i’m not alone

    1. Specie depending on time of day I’m either with you or with the ‘smart’ people. I suspect they are feeling the same way too.

      ‘You can thank your lucky stars that we are not as smart as we like to think we are!’ …. a line from some song if I remember correctly.

    2. thats right, Specie! Cant wait for you and Nic to start your own blogs and show them all how its done! thank you, you are awesome, lots of love!

        1. i understand where you are coming from, sometimes i find myself over analyzing things and maybe that’s why folks i know who have no clue why or how the markets continue to up is doing quite well by just buying a long fund…maybe it is no so bad to be like sheep? this must be the top, lol!

    3. oh there you go thinking the universe is personal

      lol

      confidence is restored and you can go to the polls and vote

      ROFLMAO

    4. There is a great book called “The Idiot and the Moon” outlining the market implications of lunar phases. It is available as an ebook for $19.

  32. this day started with data anomalies on the dow with V opening 8% plus up.

    the minute feed on the dow was all jacked up and then they resolved that only to go black on other feeds later…

    lets all say it together

    “its only a video game!”

    1. bbe please keep telling me it’s a video game

      it might allow me some sleep sometime

      meanwhile, it’s time to go find some whipped cream gas if i can

  33. Maybe my 2003 will hit tomorrow or overnight. Friday is alway an up day, I cannot remember any serious down Friday .
    Good luck all.

  34. It seems many of John’s fans are feeling discouraged, confused and lost. Wake up, guys! Everybody agrees there’s no free lunch in this world. How about free tips to make money then?

    1. Bowed in and gone long dow albeit with a very small stake. To me this move makes no sense but it’s the only way to make money these days. Usually a top or bottom forms when I switch from bear to bull or vice versa so let’s see if it happens this time. Target is 17350 then exit and wait to see if it’s a double top.

  35. Equity markets done good volatility recently.I think stock just doing sideway from now on. Meanwhile, forex and gold not doing much for 2 weeks. Now tide turns. Tomorrow Friday will be a firework for USD, gold and gas.

  36. The following graph is by far not the only indication, that John and many others on this site just don’t want to consider, because it’s evidence is inconsistent with their bearishness or cycle bias.

    Comparisons with 2007, 2008 are unjustified, if you look at the course/slope of the longer term moving averages of the main US-indices, (lacking) crossovers, (lacking) macd, rsi divergences and so on. Ciovacco is explaining everything you need to know in this regard.

    Looking at the NAAIM graph the steepness of the upswing is only comparable with October 2011 and spring 2009. The first is the best outcome the bears can hope for and it may be supported by the bullishness recorded in the AAII-survey. But make no mistake, SPX 2150 by year’s end is by no means less realistic according to the stats and market models I have presented earlier.

    1. Theo, frankly it’s just silly to say that John doesn’t want to consider the chart you present, et al. He may feel that other pieces of evidence overwhelm the facts you present and that’s why he leans bearish but to ascribe to him an outright unwillingness to consider contrary evidence to his thesis is plain incorrect.

      1. I don’t mean „unwillingness“ in the sense of a conscious decision. But if someone is wishing to discover a cycle that is working as a tool for timing market tops and crashes, be it solar cycle or what ever,he is automatically inclined to give weight to indicators that support the suggestion. That is leading to a dangerous bias in judgement.

        And solar activity cannot be an explanation for speculation peaks. People may get excited by solar activity, but it is up to them, how they deal with this excitement,just as John and his followers are deciding not to take part in bullish speculation peaks.

    2. It fine for me. Jim Roger short gold around 400$ or 500$ sorry I don’t remember exactly the price short. When gold touched 800$ he felt sick. Eventually he so rich when gold down much. I already know sp may go up to 2150 but still enjoy John intellectual. However, I stay away from SP at the moment because it going down going up too much so it will be sideway for a while before any significant move. The problem John is a longer term trader whereas some reader here swing ones. Me as day trader so no problem for me. I just read his article and enjoy his vast synthesis.

    3. Alla Peters of http://alphawavetrader.com/ is bullish based on pure price for next few months. But the long term chart on previous posts correlating market performance with the solar cycle is very compelling. Also there is a regular downturn in the market every 68 months and we are due.

    4. Hi Theo:

      The chart does a good correlation. However, we need to add something at each one of those NAAIM bottoms, QE1, QE2, QE3. Take a moment and look at the first point that drops below the “Least Bullish” line. At that point and right up to the first QE, the S&P dropped 51%. It was at the fourth test that the rebound occurred. We also have to look at demographics, business cycle and credit cycle. With these and no QE, history will not repeat.

      So, is this the first test, or the fourth?

  37. Nikkei up 1.7% at open on news pensions funds there are going to move more assets into equities from bonds. News to me is worthless, however, a friend told me today that US pension funds, etc., are reported to be doing something similar as bonds are not paying enough to meet their payout requirements. Could this be the next source of money to keep equities moving up?

    1. in that case we may see another huge leg up, ‘dumb money’ is always last to go in, retail have given up on stocks does that mean pension funds are the new retail? if that is the case then i can see crashes to well below 09′ lows that some expect to see, after pensions are all in…taking down all the pensions, a nightmare scenario – trillion dollar question is when will it happen?

      1. James,
        Trillion dollar question? Sometime NEXT year – maybe the middle of the year. Meanwhile go LONG now…..and stop listening to any more doom and gloom.

        1. thanks for the advice, i caught the boj news early and made adjustments immediately, we’ll see how things go when US opens later.

  38. Looking at the SP from a pattern perspective, it appears we may see a crest tomorrow. This top my be a wave 3 or a wave 5. If it is a wave 5 then it will end as a 5th failure. Markets that end with a 5th failure of this magnitude are usually followed by a fierce sell off that last for an extended amount of time. It is safe to say they are crash type affairs.
    If tomorrow completes a wave 3 however, we should see a wave 4 down that last several days and maybe drops up to 38% of this leg up.
    If we look at the gap centered by 1910.50 level spx, we get a mid point gap flip that takes us to 2000.50 spx target. Sometimes the mid point gap targets a wave 3 and at other times it targets the wave 5. So it does give us a projected target, but not sure if the target is a wave 3 high or a wave 5 high. We should know by how it sells off which it is. A wave 4 is a 3 legged abc type affair while the start of a new bear market usually leads off with a 5 legger.
    Thanks for all your hard work. I hope this info is helpful to some.
    Kindest regards

  39. I think the peak might be 1/2015 after all. This will still be inline with the solar cycle, which peaked in 1928 and crash 1929. In addition, IBB and NDX are making new highs. The risk right now is that we go parabolic up +30% like in 1929 or 1987 with EVERYONE knowing it is a bubble and agreeing that it is overvalued. Still, that move will stop all the bears out.

  40. The gold miners are collapsing. They have entered their annihilation phase where losses could be another 40-50% or more from here. Many juniors will go bankrupt. This is the ending phase of this cycle and no one knows how long it will last. But it’s about to get much much uglier. Beware.

  41. Dow and S&P sideways since July. After reaching a high in July, both fell sharply to the 200 dma. They rallied back to a slight new highs to only sell off to a lower low signaling a DOW primary bear trend environment and flattening the 200 dma. Both potentially very bearish developments. Now, they have rallied back close to the Sep highs. After the lower low, even a higher high leaves the mkt in a precarious formation. That is the situation the Dow trannies are in, a 10 pt or more lower close will be a sell signal of the megaphone formation forming since July. The trannies have been down the last 2 days as the more popular indices have zoomed toward double tops? The r2k is down since July, never equaling the July high. The interesting aspect of this is that it feels like the mkt is zooming to all time highs and the bulls are chortling. Could it be a bull trap?
    The Dow Theory gave a bull primary bull trend signal in 2009, and has now finally reversed. It is so fundamental, who cares. Everyone should have it at least near the forefront of strategy. One should be thinking bearish rules. I have already written how gold and especially oil had these tremendous counter trend rips that seem to exist to scare bears out and keeps bulls in all the way down. Time for a bear counter attack?

      1. If the bulls run out of firepower, as unlikely as that feels right now. Commodities, gold, oil, the $ and interest rates are fitting my scenario, but certainly not the stock market.

  42. DJI looks about to break through to a new ATH.

    GOLD looks on the prespice here.

    Unless you are utterly convinced of an imminent reversal,
    I would seriously consider closing shorts.

    1. the last time boj surprised the world the yen went nuts for over 6 months. i wonder what kyle bass is thinking right now.

  43. the awesome gift of free money keeps on giving, thank you Japan and Nic! i am happy to be out of the shorts and be loooooong! why overanalyze it when they just make money growing on trees! totally awesome!

    1. r u kidding they will print almost a $1 trillion!!! after they are done, europe will start. then the Fed. I am seriously considering that I will quit my banking job and just rip these market benefits. who needs to work when central bankers work for you!! thank you, Nic, again, for making me see it through!

      1. not only are they increasing their purchase of jgb’s, they are tripling the size of their etf purchases and don’t forget about their gpif, the size of that fund is over 1 trillion dollars, the stock allocation will be up to 25%…i am surprised that the nikkei is up only 5%!

  44. Well my 2003 hit on SPX , lol, deep in red again.

    Just closed it and will wait Sunday night, can’t sit here screen watching.

    Good old BoJ 😦

    1. NIkkei up 4.8% however its exchange rate lower 2% only.

      Either its stock market over shoot or its exchange rate need to further depreciated.

  45. It is clear that “they” knew it before the news. So gold goes to triple digits, USDJPY to the moon but as for stocks… they should fizzle after the elections

  46. Excellent! Thank you BOJ. Moved stop on dow long to break even and revised target to 18,000. Feel much less nervous going long. Still find John’s analysis the most valid I can find but it’s getting close to the Christmas rally so a crash is almost 0% chance I would say. But that’s all my opinion which is far less researched than John’s so to be honest I’m probably just getting lucky with this move.

  47. I just wonder how US can tolerate yen depreciated that much, with US dollar goes much much stronger and strong US do not help economy.

  48. Just going to say the same thing, I have never seen a SPX 200 point move down then anexact move up in such a short space of time

    1. You point out an important point, this fast up and down market action proves that only trader are in in these markets. There is no any accumulation phase or distribution phase.

  49. Blame Putin. The west now in total war financially with Putin. Decreasing oil price, gold price , rubble rate….For example, to decrease oil price. Increasing supply by telling Saudi Arab. Could be keystone pipeline, SPR, cracking. Even increasing margin for whom want to long oil but decreasing margin for those who short oil. Lastly, all the west devaluating their own currencies except US. Conspiracy, I believe FED editted its FMOC announcement to make USD stronger in order to kill Putin. I see there is an orchestra to overthrow Putin globally

  50. Here is McHugh’s Market commentary for Oct. 30. One analyst said that after a while people will get revulsed by these Markets. Here is one of the reasons:

    “The parabolic rally from October 15th is likely to generate a new all-time high in the Industrials. This changes our wave labeling. This rally from October 15th has not been broad based, and has definitely had a huge push from the Plunge Protection Team, most likely motivated to support incumbents in the U.S. midterm elections next week. The PPT is pretty smart, waiting until the overdue and necessary decline from September 19th exhausted itself, not really reaching typical selling capitulation which we see after crashes, but enough selling exhaustion to remove much resistance for the overwhelming buying they kicked off. The rally has been parabolic, with no corrections to speak of, which is typical of deep pockets buying.

    “The wave labeling change is shown on page 22, where wave d-down ended up being a 3-3-5 flat pattern, and the rally since October 15th is wave e-up. What is interesting about this development is that the coming wave i-down decline once wave e-up finishes will be more powerful than the sharp decline from September 19th through October 15th was. The timing for this decline should not be that far off, early 2015 at the latest, possibly as soon as next week at the earliest.”

    “Thursday, October 30th’s rally in Blue Chips was not that strong based upon internals, weaker than the price gains suggests. Our Secondary Trend Indicator only rose 1 point out of a possible 9 on Thursday’s rise. There was a huge increase in New NYSE Lows on Thursday’s rise. Volume was very low on the rally. We came very close to seeing a new Hindenburg Omen observation. A small decline Friday could generate one. It will be very interesting to see how much higher the PPT pushes prices over the next three days, and even more interesting to see how hard prices fall after the U.S. election Tuesday. Most short-term indicators we follow are very overbought.”

    1. https://www.boj.or.jp/en/announcements/release_2014/k141031a.pdf

      ” b) …The Bank will make ETFs that track the JPX-Nikkei Index
      400 eligible for purchase.”

      Well, there you have it. I don’t see how anyone can argue that markets are not manipulated by central banks; it’s there in print.

      Likely the other CBs will follow suit.

      With unlimited fiat currency at their disposal markets could be in the early stages of the greatest bubble in history.

      http://tinypic.com/r/2yuc3gh/8

      Near term, the FTSE will likely creep along upper trend resistance to the .618 fib.

      But as previously stated, I’m not expecting much by way of a pull back until after the US elections on the 4th Nov.

      #freemarketsnomore

  51. May I interrupt. I see Americans always talk about end game. What end game would that be? we Asian need USA strong for ever because we kill each other very well otherwise. When US left Iraq the mess there but if US does so in Asia Pacific, I sure we killing each other far more than radical Islamist. IS brutality would be dwarfed by us Asia. With all respect, you as Americans should believe strong in your own nation, PLSEASE !

  52. Gold cut through what many considered important support
    Like a knife through butter.

    The best anyone short can now hope for is a minor retrace

    To work off overbought indicators.

    Very luckily I do not go short markets or use any margin.

    The case for 2014 waterfall declines is now dead.

  53. And if anyone needed anymore evidence that Central Bankers were and are prepared to elevate stock markets then todays action by the BoJ should lay that doubt to rest.
    There has been a concerted effort from the ECB,Fed and BoJ the last two weeks to inflate stock markets to avoid what was turning into a collapse.
    As sure as night follows day Central Bankers understand cycles, technicals and they knew full well what was unfolding and what the potential consequences were.

    I really don’t know now where this market goes. I do know at some point it will collapse and that it will be the most horrendous collapse in history due to excessive intervention.

    I am thank God I am not short and I hope those that are really take great care to protect yourselves.
    I will not be going long and refuse to participate in what I consider to be irresponsible, immoral action by global CB’s and trading banks.

    May God help us all because I don’t think that anyone can comprehend how bad things are going to get when it finally does collapse. It will likely make the Great Depression look like a golden era.

    1. Agree completely but I’ve realised I might as well stay long and become rich in the process of this stupidity. At least I’ll feel happier lol.

  54. Did anyone read the small print released from BoJ?

    Iv just taken a look, before I get shot down, did anyone noticed anything different?

  55. Here is a clue, look at the change of distribution, and time line, prob why Japan is up 5% and poor old ftse is trailing well behind that level.

    EU CPI is out in 5 mins, could change or spike up.
    Wtfdik

  56. May I share my Biblical view of the end game ? It may bit of taboo for you so I apologize first. At the end, the Jews will conquer all the world. To save the world, all Christians needs to evangelize to the Jews about JC so they can admit JC into their heart. Then JC will destroy the whole world to make a new one on earth. But before that happening, Islamist trying to destroy Israel as well. They will be backed up by Russia and China. To counter attack, the West needs Japan, India and Vietnam to contain China in Pacific. So there will be a lot more things going before anything about your 41k, your retirement account, your hoarding gold, your pessimistic view about USA or whatever. I from the East, I know the weakness of China and Russia. They will lose to USA but US weakness about military industrial complex and banking controlled by the Jews. So in all, the West will win over Russia and China, then the Jews make American people like slaves, then Christians save the world with JC later on. Keep strong faith ! Keep your faith on your own USA please ! Why American so pessimistic about their own nation ? US won over Britain, Hitler, Islamists, USSR, Japan -The Rising Sun…..USA came over many crisis but always prevail from Great Depression, Bretton Wood, Oil crisis, dotcom bubble….You can have insane profits from SP500 down or up by long and short accordingly. US will go down last, actually last second after Israel, meaning all other countries must come down before happening to your USA. So don’t be panic, don’t sell out your America. Just for trading ,buy buy then short wisely even John right at the end but that not mean you can have profits by long in up swings

    1. Aaron

      WHY should Le Hong be removed from the bb? Does truth hurt you that badly or what?

      And remember THIS is America not Israel.

    1. Phil,

      WHY? cannot handle the Truth? If you cannot, you can easily SKIP past his posts surely? Nobody has a gun in your forehead FORCING you to read his post!

      Grow up please. Reminder: This is AMERICA.

      1. Thank Joecthetruthteller. Truth is always truth. Remove me or not, don’t bother me. But thank to John. His analysis very enlighten. John helps you prepare to end game, not CTA advisory services to offer trading position . I long Sp500 from the bottom but quit soon. John helps me not being so greedy. Im overseas so no way to access US futures market so I doing forex. Based on John analysis, I figure out USD will be the best. SP500 up or down USD always prevails especially ECB, BoJ and RBNZ all destroying their currencies now. Then I short gold early. Trading gold u need a broader perspective and John give you free here. Too much to get from here

      2. To quote Rodney King: “Why can’t we all just get along”. Part of getting along is being respectful of others opinions without getting caustic. If someone has foolish ideas direct contradiction is ineffective.

      3. many of us here are Americans, but John is British, so it’s totally up to him how he runs his site. Even if he were American, it would still be up to him! It’s his site, he pays the rent on it. He can close this comments board if he wants to, or if he wants, he can exclude certain members. Has nothing to do with free speech or truth telling or whatever you want to call it. If you don’t like how the site is run, you can always start one of your own and then run it how you wish.

        1. prima,

          I didn’t see ANYONE here saying they don’t like how the site is run. Where did you get that idea from?

  57. I would say this, If you believe in bible, then you should remember 144000 is an important cycle, and in coming Dec 18-23 2014 would be (1) 1440 TD from 2009 Mar 6 low (2) 90 / 91 CD from Sep 19 top, in Gann term is a square and i think we likely to have the top around these date and drop til 2015 Aug.

    My projection,
    time is
    Nov 4 big down day (if you believe in the PPT no need to support the market anymore lol)
    Nov 7 TD (non farm payroll, mostly better than expected as hawkish statement from FOMC so buy on previous day Nov 5-6 and sell the news)
    Nov 11 TD (low) and rally to Nov 20 Bradley day (possible top for 2014, if not this day then might be in Dec 18-23)
    price is SPX 2050 around (if you draw a TL from 2007 first top Jul and connect it with 2007 final top in Oct and extend.

    Good trade all.

    1. Thanks mate. Thanksgiving full of surprises perhaps :).

      I know of one analyst that says we top out just before Thanksgiving and begin the biggest decline in history right through ’til 2017 eventually taking out the 2009 lows by a mile.

    2. I would like to supplement why i think Nov 20 Bradley is a high, if you have study George Lindsay and there is a famous pattern for 3 doom and a house or whatever and one of the pattern was a low +221 to 224 CD always was a final high. This corresponds to the low we have on 4/11 this year.

  58. There is a significant amount of solar activity (flares, spots) that have happened in the last few days/week. Coinciding with the strong rallys. After watching this website for a few months it seems to me that prediction of the solar activity would be most beneficial for trading. From my observation the market trades very closely with the solar activity (maybe even to the minute). Those who could have predicted this october peak in solar activity woudl have been able to see this rally coming a mile a way, it seems.

      1. That’s what i’m saying. I don’t believe that we don’t know when those sunspots are coming. Look at Gann and Jensen and Bayer they all knew about this. This info has been known for YEARS. People know well in advance what the weather on the sun will be like not just when the solar maximums etc are going to happen.

  59. I am going to have to spend less time reading this blog, as a few posters above are either trolls or just stupid.

    Thanks John for your information over the years, I wish you all the very best.

    J

    1. thank you for giving us all a piece of your mind!

      the chart that never lies, AS I SAID YESTERDAY, has been on a buy signal since last FRIDAY. Yet todays action hasnt forced a cross of the ma’s. that isnt so very important except that there are all kinds of weird candle sticks and patterns showing up like yesterday. I havent participated on that signal because as I also said yesterday my Dad went into the ER on Friday. So SUE ME jegersmart. (JEGERSMART! LOL no ego there! hohohoho That Jeger, he be a smarty! ROFLMAO!)

      Check out that last two days candles on the $BPNYA – NEVER have I seen such odd spikes in that indicator.

      And yesterday’s spy tape was one for the record books.

      the NYAD is seemingly setting up divergence that is needed if a top is forming.

      dangerous

      1. I don’t want to make assumptions, but if I would bet that jegersmart was referring to a couple of other posts here and not yours when he said he’d be leaving.

  60. I use google translate quickly.
    I like to read John’s article,
    Each I have a backup.
    John is a very far-sighted and meaning person.
    He is doing a very great job.

    The following is taken from a very high accuracy explain righteous book (not China).
    Provide users reference countries.
    Historical events that have occurred, I will not explain (for example: the book naming names of Chinese leaders Xi Jing Ping.)

    1. Prior to AD 2018,
    a. Japan’s devastating earthquake is likely to occur.
    b. Japan suffered bomb attacks.
    c. Other
    PS: Since then Japan has never recovered

    2. between AD 2012 ~ 2018
    Big events worldwide (or disaster)

    3. AD 2033, China began to implement democracy.

    4 …….

    n. AD 2096, the Earth’s biological warfare occurred.

    Derived from the Chinese Tang Dynasty accurate prophecy book:
    Tui Bei Tu

    1. Some believe that the future can be affected by the power of human intention.
      That could have been the future for the people and intentions of prior times. The cumulative intention of all the people who have existed since that book may alter the events. Check out the work of Bruce Lipton if you are interested in this:http://en.wikipedia.org/wiki/Bruce_Lipton

      1. I use google translate quickly
        Since this is the present 1500 years ago in ancient books.
        Most of the descendants of its interpretation is not correct.
        This book should be used to explain the Chinese Book of Changes.
        This book its circulation is only about 1,000. (2010 publication)
        I nearly 20 years, I have read the contents of the clearest explanation.
        So not many people know (the book explained after) the existence of this book

        I found this book very similar to John speculation.
        This book will direct sun pattern as illustrations.
        Affect the time is AD 2012 ~ 2018

        1. I consulted the I Ching in 1982 just before the beginning of the great bull market. Most people were bearish and pessimistic. So I asked was there going to be a depression and and huge bear market. THe I Ching said No, A great edifice was going to be built on a foundation of sand. As time has gone by, I have been more and more impressed with that answer.

        2. I Ching’s more ancient than the Tui Bei Tu.
          Tui Bei Tu want to read, you must first understand the definition of the I Ching.
          Tui Bei Tu is the author of China in the Tang Dynasty astronomers: Li Chunfeng
          He is now the prevailing lunar Modified.
          This book is for the historical events that have occurred can correctly predict, and accuracy of prophecy has come to the point of “minute.”
          If you’re looking to understand Chinese, this book is very interesting.

    1. wow not much play to the upside here but I thought the trendlines would be retested before a splat

      this really is a classic set up for the divergence on the breadth indicators

  61. I was atheist and do not indulge in superstition.
    But I respect any religious person.
    Everything I look at the evidence.
    ^. ^

      1. My English is not good enough.
        so I use google translate quickly. >.<

        a. In a given year AD 2012 ~ 2018 period.
        Global event (or disaster) will occur.
        The sun is triggered culprit.
        May be a serious global climate anomalies
        John speculation or knock-on effects
        Or other.

        b. This book describes the situation in Japan is similar to severe volcanic eruption or a nuclear bomb attack.
        Japan never recovered.

        c. AD 2033, China implemented democratic politics after independence for the five countries.
        Decades later combined into one country.

        This book is a banned various dynasties in Chinese history.
        Because it is extremely accurate, precise prediction history dynasties flourished.
        So are afraid of each emperor.

  62. Anyone has a new target for SPY for the bulls?

    Baba wasn’t the top,Nikkei yelled Banzai and september was just a correction.

    1. Should be complete confusion from here on out. Commodities, pm, equities, bonds will trap huge money on wrong side. But vix will generally trend up through it all. Bet on chaos.

  63. The Sun VS. The Markets & Governments. Guess who will win?

    What? The big guy didn’t want to fight? He didn’t care? Both of the sides didn’t even know there’s a fight?!!

    Come on! It’s for self-amusment only.

  64. Is there anyone have a Nikkei USD denominated chart?
    When I looked at Nikkei (Yen dominated) Today has broken the downtrend line from 2000 to 2007.

    For USD/JPY, I have target first 112.67 (1200 pips) and 115 (1440 pips) from this year low.

    1. I have the chart, but I don’t know how to upload it. You may do it yourself. It’s simple.

      Draw the chart “Nikkei:JPYUSD”.

    1. Breakaway gap exhaustion gap. It’s irrational exuberance based on US economic news and expectations of EZ money in Europe, Japan, and probably China.
      The EZ money places are sending capital to the US for the strong $ and rising stock market due to US “strong” economy. I have been expecting deflation to overwhelm the EZ money Credit cycle, but obviously hasn”t happened yet. Oil and commodities going down, the strong $, and low interest rates have been correct, but not the stock market.

      1. Yes, its a breakaway gap but in order to show it have weakness, must need a reversal bar (open higher than yesterday close but close below yesterday close).

        1. Et tu apple? your narrative left brains wont let you look at the one hour gap in yesterday’s data feed and the agitation of the HFTMachines.

          funny how the human brain simply confabulates a story to explain discursive data

      1. Did you write that with a straight face? No argument (I’m a bear also), just can’t resist saying some of my snide, sardonic thoughts.

    1. I rate pugsma but I reckon price will likely go through by a few pips before pulling back slater9 – got to get the maximum number bullish.

      And then there’s the matter of those elections! Bit higher than 2019 I reckon FWIW.

      As an aside, Dow 13333 looks like a buy for a little intra-day trade IMVHO.

      DYOR.

  65. the erratic action yesterday and the desperation of using BOJ as a surrogate is proof of a back fire and unwind

    hold on kids; this is no theme park

    1. a close below 2011.36 or the Sep high in the cash index would be nice. Similarity to Gold double and bubble peak in 2011 could be made then. Bubble tops are messy affairs. This one is no different.

  66. Just one last thing, my comment was not directed at Banned by elvis…..as he seems to have got upset……maybe he gets that reaction a lot? But NOT aimed at you – honestly.

    Good luck all.

    1. I know who you were aiming at – honestly!

      I just think calling yourself smart and others (any others) stupid is, well, stupid!

      live and let live or move along?

  67. Placing a short on the rebound rally after a greater than 6% correction from an all time high is a great way to short a major market. The risk reward is very high. Holding onto that short after new highs are made…..not so great. Still have 3 hours but not holding my breath.

  68. now that the boj has gone all in to devalue, other aisan countries will have no choice but to devalue, the problem is that a lot of their debt are in us dollars. i think what we have here is the beginning of asian financial crisis part deux…oh what a mess we’re gonna have.

  69. I reviewed the last six significant corrections in SPY that had sharp declines exceeding -4% (each from a 52-week high at the time) which featured a subsequent V-type recovery that date back to May 20-2013. I used weekly charts for reference here so dates begin on the Monday of each new week:

    SEP 15-2014: 201.9 to 181.92 (5wks) -9.9%
    V-Recovery: to 201.82 (2.5wks)

    JUL 21-2014: 199.06 to 190.55 (<3wks) -4.4%
    V-Recovery: to 199.76 (3wks)
    Exceed hi: to 201.58 (2wks) to 181.92 (6wks: Oct bottom)

    MAR 31-2014: 189.7 to 181.31 (2 wks) -4.4%
    V-Recovery: to 189.14 (<3wks)
    Exceed hi: to 190.42 (<2wks) to 198.29 (next 7 wks) to 190.55 (5wks)

    JAN 20-2014: 184.94 to 173.71 (<3wks) -6%
    V-Recovery: to 184.95 (<3wks)
    Exceed hi: to 188.96 (<2wks); to 181.31 (5wks)

    SEP 16-2013: 173.6 to 164.53 (<4 wks) -5.2%
    V-Recovery: to 174.5 (<2wks)
    Exceed hi: to 181.75 (next 6 wks) to 177.32 (<4wks)

    AUG 5-2013: 170.96 to 163.05 (<4 wks) -4.6%
    V-Recovery/Exceed hi: to 173.6 (3wks) to 164.53 (<4 wks) to 173.6 (3wks)

    MAY 20-2013: 169.07 to 155.73 (<6 wks) -7.9%
    V-Recovery: to 169.27 (<4wks)
    Exceed hi: to 170.97 (<2 wks) to 163.05 (4wks)

    So the six past V-Top style corrections where the V-recovery reached back to its previous 52-week high from the bottom, all six of them pushed through to new ATH in the amount of (SPY points) +2.5, +1.7 (+8.6), +4, +8, +2.6 (fail), and +1.9 respectively (in date order from most recent to latest).

    The only V-recovery that can be categorized as a "fail" was the week of Aug 5-2013 where it made the recovery and shot through to ATH in one leg before collapsing in price. The other ones typically took under three weeks on average to push through to new ATH after reaching the previous high on the recovery.

    Considering NDX made a new ATH today and SPX only hit close to its previous 52-week high so far and based on past historical chart patterns, the probabilities weigh towards SPX also making a new ATH within the next three weeks of at least an additional 20 to 25 above its previous 52-week high of 2020. But be wary because in nearly every case (except for the Mar31-2013) after establishing a new ATH it also exhibited a subsequent decline that spanned 4 weeks on average.

    1. Thanks for your analysis and sharing.

      Yes, I think there is a high chance we have a ATH for SPX as $TRAN and NDX has made a new ATH already.

      For the target, 2051 is a likely target (that’s 1.5% from SPX high 2019) as this is an (1) uptrend line resistance (2007 Jul to 2007 Oct high TL) and (2) it is the 1.382 extension for wave one 2009 low to 2011 high (666 to 1370)

  70. HUI hit the bottom of that 18-month trading channel today at 152 and it bounced along with gold. It took only a couple of days and did not even require Nov to reach that target. It probably stays in the channel recovering for a bit now before it can break out below 150. Maybe it does not happen or possibly takes a few more months of uphill grinding back up, but if HUI declines below 150 in the months ahead then you are realistically looking at 100 HUI and likely $1000 gold.

    1. Steve, your call is spot on both shorting metal-related and longing stocks. Hats off to you. Interestingly, in the futures market we have the highest volume on down bar for two consecutive days this year, whereas all the other high volume days are on up bars. Professional money always buy on down bars (bag-holding the panic sell-offs) And in the background we have QE overdosed sentiments all over the stock market. Plus this news regarding Swiss Referendum in November. The end of a downtrend is usually marked by high volume large spread sell off.
      http://www.forbes.com/sites/stephenpope/2014/10/25/switzerland-set-to-greedily-grab-gold/
      Again I’m not a buyer in the precious metal market but this is what the volume and price action are telling me. I will not take on either side of the trade until a setup is triggered with a follow-through action, such as a pull back with a retest of previous low levels. And I do suggest others to do the same.

  71. Elvis, do you think your bearish outllok
    Comands any confidence with those reading?.

    There are two posters here who have called this
    Correctly, Steve T and Nicholas.

    1. Phil do you think I care what you think as the minute charts look like a smiling baby puking after every bite!

      What possesses guys like you and Jsmarty to personalize everything – if I am wrong then I suffer, not you.

      By the way, IF YOU COULD READ, you’d have to admit that I said we’ve been on a buy since Friday – now I think it is stacking up now as a “sell”. I think there are many divergences lining up.

      so again, if I am wrong I suffer. NOT YOU. Do what ever the fluck YOU WANT…

      there are still coupons available for

      1. seriously its just a video game! not even a movie for gods sake

        shake off your cultural programming and reset your head!

    2. phil

      why would you even post that

      everybody here can choose to read or ignore any post

      the more ideas the better, and i don’t care who they come from

      an idea isn’t right or wrong just because it comes from a certain individual

      they all deserve consideration

      maybe even mine – some day

  72. Elvis, do you think your bearish outlook
    commands any confidence with those reading?.

    There are two posters here who have called this
    correctly, Steve T and Nicholas.

    Without typos.

  73. I’ve been cognizant of the bear arguments for a long time, whilst trying to let price dictate my next move.

    But I really feel that today I was handed a gift by the BOJ; their move with regards to the purchase of Nikkei ETFs made it absolutely crystal clear why the “Prechter crowd” are so wrong.

    Central Banks buying up the indices is a big deal. There was no subterfuge, no cloak and mirrors, no Presidents Working Group on Financial Markets (PPT) etc. There it was in black and white. A policy statement; a statement of intent. This time it really is different.

    Gratitude to the BOJ.

    BTFD

    DYOR etc

    1. what about the “pecker crowd”?

      I repeat – long signal on Friday the 24th – now I think sell signal likely

      peckers woods need to stop creating false dualities and straw men to stroke off to

  74. Happy Halloween everyone. Going to take my kiddie out for a run and come back home for house party. Party safe for the bulls, full steam ahead

  75. Elvis,

    Highlighting your incorrect calls may be
    Helpful to others as you often attempt to
    Shout down those who disagree.

    Perhaps time for you to reflect and reconsider.

    1. what FUCKING INCORRECT CALLS????

      BUY SIGNAL SINCE FRIDAY AND I SAID I THINK THAT WE ARE GETTING AN ALIGNMENT of indicators THAT MEANS SELL RIGHT HERE!

      CAN YOU FUCKING READ!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!????????????????????

      now, my long term view IS bearish but I DO NOT TRADE MY LONG TERM VIEW you illiterate ass!

      ahyeeeeeeeeeee communication not a possibility!

  76. Just checked my account balance and found I’ve made 20% in this October. It’s my best personal score, ever. Thanks very much, folks! John is a cool guy, but other commenters are even more fantastic. Honestly, I’ve learned so much from you guys.

    I’m a big fan of this great site.

  77. You just witnessed the beginning of Primary Wave 3 up. Don’t screw with it. Bears will capitulate in 2015. What you are witnessing is smart money front running that. We may get another dip buy at 1950 at end of month or not.

    http://redlinescenario.blogspot.com/2014/10/dude-is-lost-next-dip-buy.html

    For what it is worth. The bull started in 2012. Everybody who is counting this on the Internet is wrong. It was a perfect complex correction from 2011-12 to end the bear.

    Thank you for your work John.

    1. Souljester. I really like your posts, you provide very good insight. I like that you allow for the possibility for the market to go up or down. I flagged your most recent posts here on Sept 12 and 16. Do you have your own blog where you post more frequently?

  78. Too much emotion flying on this board, which I completely understand. Congrats to the bulls for having a stellar corrective rally. I’ve come to believe that the Fed manipulation has distorted this market to the level not ever seen before. Obviously they are trying and successfully keeping the markets up until the election on 11/4. My view is not wavering… the Fed can stretch the cycle, but they can never eliminate the cycle. I think it will be the bear turn, shortly after the election. Too much divergences, too much panic buying. It is Oct 2000 all over again.. and we all know how that ended up.

    The markets sold off every time the Fed ended QE. They did after QE1. They did after QE2. What would make QE3 any difference now???? I am not sure about the crash scenario. But the 20% min correction as John has demonstrated is not out of the question. imho.

    1. Agreed erick

      Despite the announcements and price action today, a sharp correction cannot be ruled out.

      I’m thinking we penetrate all time highs to get everyone bullish and then a sharpish pullback to 1920s before 2067, and then a nasty “c wave” to 1730s by end of Q1 2015. That should put the cat amongst the pigeons.

      Not a prediction, but one potential wave count. Price will determine ultimately.

      WTFDIK

      GL

  79. Just a word of caution for newbies. Don’t read too much into some of these posters. Read it with grain of salt before making any investment decision. Some of these predictions have been more wrong than right. Always hedge no matter which side you are on. As long as you ride the trend, you will always make money. Just remember to get out before the party is over.

    1. To flesh those bones a little:

      Unless you are a psychopath, more likely than not you are going to get upset sometimes when your trades don’t work. Sure, some meditation or transformational breathing can help here, but what you really need is a Rule-Based Trading system to take the emotion out of it.

      Back test until you find an EDGE – one that is demonstrable, explicable, repeatable. Then apply that edge like an ice-cold automaton – or better yet, have a computer do that for you, if you have those skills.

      To find that edge you need to measure your risk/reward – measure your returns in terms of R, your risk on each trade i.e. your entry to where your initial stop is. Convert this to a percentage of your assets and decide how much you will risk on each campaign. Back test the effect varying this number e.g. after a certain number of winners/losers has on your equity curve. Have a plan for how you are going to manage your campaign, trail your stop, make your exit – before you enter. Place your stops in the market, not your mind.

      Do all this consistently and you have a shot at making the profitable 10%. The reason psychopaths win at trading is because they don’t let emotion cloud their judgement and deviate them from their strategy, as the rest are wont to do.

      And remember, it’s just business, nothing personal 😉

  80. John,
    As always, I appreciate your time, thoughts and research.

    I am hoping you can help me elevate my understanding of a solar issue and potential impact. Is there a difference between Solar Prominences/Filaments and CME’s. As best I can tell there isn’t. And I am curious if there is an impact of same on economic/financial activity, that is different than Sun Spots. The reason I ask is that it does not appear that all sunspots produce Solar Prominence/Filaments or CMEs (I am assuming that they only emanate from sun spots which may be a very bad assumption), so clearly there is a qualitative difference to sun spots. The reason I inquire is that, as pointed out here in earlier posts, prior to/concurrent with, a recent sunspot was very large and had an associated CME. Next question would relate to the historical numbers regarding CMEs/ Solar Prominences/Filaments.

    Any thoughts or direction? Thanks in advance,
    SC

  81. Le Hong, I am from Guangzhou, China. I came to America when I was 5 years old. Here is my take on the “Biblical view of the End Game”. Yes, you are right – China is weak because it is a Communist country without freedoms. However, the Globalist Elite have worked to strengthen it (such as through trade) and also funding Mao Tse Tung so that it will be a future enemy. In order to accomplish their goal of a NWO (One World Order), they must have enemies they can defeat and conquer.

    And Americans have every reason to be pessimistic about our country because we have been taken over by a cabal of Elite Globalists (Banksters), using our Military Industrial Complex to destroy and take over other nations, using Central Banks to rob everyone on this planet clean. Our Constitution and Bill of Rights have been shredded. We are spied on like guinea pigs and a militarized Police State is forming before our very eyes. We are now ruled by Psychopaths. And our Congress has been bought out and essentially powerless.

    And it is impossible to preach JC (Christ) to the Elite (or ruling Jews) because they are Satanists. The Second Coming of Christ is HIS COMING IN EACH OF US spiritually. Jesus Christ already came in the physical the first time as recorded in the Bible. His second coming will be the coming of the Christ Consciousness in each of us. In other words, when the people move up in consciousness and wake up on this planet (especially in America), then the Psychopaths will no longer be able to be the rulers and masters of this world. This is what the Elite are afraid of. That is the reason for all the NSA spying, “Homeland Security”, fear mongering, etc. For example, ISIS and Al Quada are funded by the U.S. and its allies such as Israel, U.K.,Saudi Arabia and others. The end game in this is eventual war with Russia and China, WWWIII, to control the world. There likely will not be a big economic collapse in the U.S. until then as the PTB can probably keep this game going for quite a while (though I think we are still due for a good size correction that I think the PTB will allow to occur to reset the Markets).

    Hopefully by the grace of God and the Sun, WWWIII will not happen. I say the Sun also because it is said that the Sun is able to affect changes in the consciousness of the people through its radiations and changes in the electromagnetics on this planet. These changes in the electromagnetics of the earth also causes changes in the electromagnets affecting our brains and our hearts. Now you know one of the reasons for them Chem-trailing (spraying chemicals) on us from planes, it is to keep the Sun’s radiations from reaching us and enlightening us to overcome our Over Lords – so that we may have true Peace, Freedom, and Prosperity on this planet (minus the Psychopath Elite and their endless wars).

    Thank You and Bless you John for providing a forum for all of us. I bet you never thought your site would end up looking like this!

    1. Thank Mae. Keep strong faith !

      I think John not surprised because at the end you realize when you discuss about Son or Moon, u will end up to God or at least 7- year of Joseph cycle or a Time to plant and a Time to uproot. So after reading John synthesis and Jonathan post about forex, I sat down, reflected and meditated then the good idea came: LONG USD across the market. USD has got 7 years from 2007-2014 going abroad as a funding currency for carry trade. Now it is time for coming back home. Even John said Sp500 down but for me his vast of research stimulate me think clearly. John gives it for free and I just figure out how to apply my own trading.There is Bible, there is John blog and there is Jonathan prophecy. That my recipients for my trading idea besides my system. My account up 50% just 1 week. I still short gold and see it can plunge to 1000$ on next Monday

      P/s: I disagree with you partly about JC coming just for Consciousness but let this blog be tidy and neat

  82. Why don’t you, Jegersmart, create yourself a seperate home, so you can get used to the idea that different people have different views wich fortunately can be opposite of yours? Don’t you think John has other stuff on his mind right now? This must be a difficult time for him.

    And then there is Phil. What is wrong with you? First you bash André in his effort to make sense of the moon and the tides and the stockmarket, october 26 (“start your own blog, instead of insulting peoples intelligence”). Than you want Le Hong Linh to be banned from this site for giving a personal take on matters. The next thing you do is going after BBElvis who provided us with many useful charts to illustrate his views, helping us to navigate the wild swings in this market. Bullying people is contraproductive, you should know that.

    Peter.

    1. The last thing I will say is to look at the histogram on all the daily index charts. In virtually every single case it is the most overbought in years and I mean YEARS, ie not 1 or 2
      TVIX/UVXY diverging.
      Once again good luck.

  83. it’s been a month since I last posted and things have become even more emotional on this BB. And wow… almost 400 posts!

    Dollar index looking to break out properly as I’ve said all the long and the Japanese decision is no shock to anyone who understands the debt crisis developing all around the world, especially in Europe. Wait until European banks start to vomit. Then we’ll have drama.

    The British Pound closed below 16,000 this past week and this coming week spells a lot of trouble for Sterling. Look out below. Anyone who is short the Dollar or the stock markets has to be crazy in this environment. What we are seeing is something never experienced before. We are seeing global currency wars and I have urged many of you to track the flows into safe havens such as Sterling last year and now the stage is set for the U.S. Dollar. With a strong Dollar, we will see strong US stock markets.

    Why fight the trend? Being short is moronic. But good fortune to those long the Dollar. Many of you will learn the importance of the carry trade throughout 2015. Maybe even Forex Kong will! Then again…. 🙂

    1. so glad to see you (Jonathan) post again. Your view balances the crash now or crash very soon crowd here.

      So much emotion here. Really there is no need to shout or insult others and put more stress on John, our host. Thank you very much.

    2. Glad to see you back, Jonathan. I do forex a lot. I short GBPUSD and EURUSD before FOMC announcement.

      Guys, I already said apologies before posting my view of the world. Fair warning given and I thank if you read mine recently and sorry if you feel uncomfortable with

  84. Hi Peter

    Apologies for creating more turmoil, there are a couple of posters I am referring to. I don’t know John or his personal situation so I don’t think your vitriol is deserved. I certainly relish different views but not trolling. I realise these things are subjective however……

    J

  85. Peter,

    Andre is consistently incorrect, if you find
    that useful then great.

    Anti Semitic comments are disgusting and the
    refuge of those bitter who have failed in life
    seeking excuses for their own failings –
    anything other than except personal responsibility.

    I was one of a number of people who commented
    on that post.

    Elvis swears uses capitals like a kid and
    appears to throw tantrums, quality posting.

    I appreciate this may have been a difficult week
    for many of you,

    Best Wishes.

    1. Anti-Semitic? Where are you seeing anti-semitic posts and who made them? I’ve read the posts here–maybe I missed something–but don’t recall anyone being anti-semitic. And aren’t you being a bit presumptuous about motives of those who do stoop to being racist? How can you possibly know whether they are bitter, whether they have failed in life?

    2. Wow wow thank for not shouting my name here for Anti Semitisms !

      Making myself clear.Actually I not hate Jews, I am even love them. I admire them. Almost Noble Laureates are Jewish or short of from Jews. Israel agriculture the best, they have fish farms in the middle of desert. Our commandos using Israel tactical weapons. I hope I can learn from them many things. In turn, I will try to talk to them to have a second thought about JC. That is. JC is a Jew as well. God love Jews why I need to hate them ? That your conclusion after reading my post above ? My points are 3 things if you misunderstood. First ,Americans suggested to revaluate and kindly advised to believe again in their own nation strongly. Second every Christian nation needs to protect Israel from Russia, China and Iran attacks because both God and JC love Israel and don’t want them to be in carnage. Lastly, love Jews and talk more about JC to them when having a chance.

      P/s: Bible is my source of wisdom for trading and investing, that why I bring it up here

    3. Phil,

      You need to take a chill pill. Are you Arab? Arabs are the only ones who can truly say that they are semitic. The others are simply wannabes as they have an Agenda.

      So what’s your take on the Market, the sun, moon??

  86. Allan,

    Your and John Hampson’s comments are why I regularly visit this blog. Seeing the impolite behavior of some, I understand your sentiments, but I sincerely hope you will not be away for long.

    Regards,
    Apollo

  87. The reason why people are upset with André’s work is that he wants us to believe his contributions are forecasts, instead of what they really are: exploring possibilities. It’s not up to me though to judge the words he wishes to use. Same holds true for Le Hong Linh. It is his personal view he expresses and his angle, to state the obvious, is rather unusal and not in accordance how most of us view the world. And a very angry BBElvis expresses himself using capitals. We all are different.

    This fully reminds me of 2008. Exactly the same happened on another blog. People are suddenly angry with each other, get personal, while others leave (Allan). Telling isn’t it? We need each other insights to weight our own judgement and make our own decisions. I will miss Allan’s contributions and I do hope he will change his mind when we can prove we can be adults and accept people are different, weather we like it or not.

    Peter.

    1. Thanks a lot for the link. The stat is a very timy and convincing warning, that the all clear for the bulls may be too much of complacency. The divergence of TVIX that Allan hinted to above, is showing in the same direction. A very similar divergence occured near the end of October 2011 before a bigger pullback. That scenario would also fit to the target of PUG stock market, that slater presented. Finally Chris Puplava’s article on financial sense is raising doubts as to my suggestion, that we will see a furious rally continuation thereafter.

  88. Already more than 400 posts here! My goodness! John must be a charming host.

    The more people participate, the more value this forum has. Folks, let’s share our thoughts, our trades and our experience here, and make this land prosperous!

      1. Thanks, CJ. Frankly, I feel so flattered that I want to share my positions here, as well as some thoughts about the markets.

        1. I closed out most of the stocks long positions on Friday, including ES and DAX futures. But I’m still long Nikkei (Yen dominated) and MSCI EM futures, and short MSCI EAFE futures. The Net stock position are slightly long. Basicły, I’m cautious on stock markets right now. I still think the stock markets could be declining in the next two months. But it’s almost impossible for SPX to fall under 1800. Buying dip is still the best strategy for trading US stock markets.

        2. I’m still hugely long DEC 14 VIX options spreads, long strike 17 call, short strikes 27/30 call, respectively. Also long some DEC 14 VIX futures, because the short call positions are bigger. I built up these VIX positions in early Sep. Needless to say, it feels like riding a roller-coaster. I deem these potions as insurance. So, it’s OK if I lose all of them. But I think there’s more than 50% chance that VIX has entered into a long-time rising cycle.

        3. I have huge Dollar index long positions. Also long some USDAUD and GBPJPY, but not big. I agree with Jonathan’s thoughts on the U.S dollar. He explained the reasons very well. Thanks again, Jonathan.

        4. I’m hugely short Dec 14 GOLD futures, but long some copper and gold miner stocks (built up position on Friday) as a hedge. Gold traders should pay attention to this: GOLD/$HUI ration was at all time low last Friday. The last time this ratio stays so low was in 2000. I think this signal only point to two possibilities: either the gold miners are under-priced which means gold bull market should continue, or most of the gold-mining industry will be destroyed. Human beings have accumulated huge amount of gold in the past 10,000 years. Technically, gold miners are not necessary for most of the world.

        5. I’m long numerous fixed income products, including Muni funds, preferred stocks ETF, EM market local currency bonds, VZ, and a little bit junk bonds. I think the U.S dollar short term interest rates will be staying under 2% in the next decade. Buying dip is the only choice for the U.S fixed-income markets.

        6. I went short JGB 10-year futures last Friday, just as a gamble. Last year I did well on JGB shorts right after BOJ announced astonishing measures. I hope this time it could be working too. But I don’t have full confidence. It looks this time is different.

        1. Thanks, Michael. I always appreciate seeing what other experienced traders are doing. Good weekend to you.

  89. John

    I’ve been with you since the start, but nowadays I do wonder. I think it was a mistake to have ever put a comments section on your website.

    I don’t believe it helps you, probably the opposite, and I for one have never read one comment out of this puerile rubbish that has added to my skill set.

    Will

  90. Will,

    Not everyone is as experienced and astute as you are. Some of us, myself included, do get value from some of these posts. I’m particularly interested in the lunar influences and appreciate those who are doing research in this area and are willing to share it here.

    Referring to ALL comments as puerile rubbish is a bit of an exaggeration. I would agree with you that some comments here are puerile rubbish. They are the ones that speak of other comments and commenters with disdain, name calling, and other forms of character assassination. What category does your comment fall into?

    1. prima,

      Including someone who makes up little stories like saying that people don’t like how this site is run!!

      I didn’t see ANYONE here saying they don’t like how the site is run. Where did you get that idea from?

      1. what are you talking about? I like the way this site is run. Where’d you get the idea that I said I didn’t? Do you have me confused with Will?

        And it’s not “prima”, it’s “pima”.

  91. Being open-minded, Will dude! There are many impossibilities in the physical world, but nothing impossible in the markets. Let’s face the fact: no one is able to foresee the future. So, everybody is guessing, no matter how confident he or she seems to be. Everyone’s guessing could be right, or wrong.

    It’s OK if a trader’s guessing prove to be wrong. George Soros once said his speculating trades had an 60% or so winning rates. My own record is much worse than Mr. Soros’. But I’m still proud that I can beat a chimpanzee, whose directional bets should have an exact 50% winning rate.

    How to improve our winning rates? Imho, observing other traders’ thinking ways is a good idea. Then you may know why they are right or why they are wrong. Then you may get your own thoughts. Here’s the rule of thumb: you’d better trade on your own thoughts, if no one else is responsible for your trading loss.

    Close-minded is a suicide way for trading.

    By the way, shorts are basicly speculating trades, because time is not on your side. Being short major stock index put options, like Buffet did several years ago, is the only exception. This is actually a investment.

    1. While I agree that being closed minded can be detrimental, the problem with being open to anything and everything – as many people are on this blog – is that the candidate methodologies for market analysis are infinite which means the probability of finding anything useful is essentially zero.

      What many people don’t seem to notice – or at least I infer that from their posts – is that John seems quite strict in terms of only incorporating inputs in his analysis that he deems to have some kind of realistic cause and effect mechanism. This is a world apart from many posters here whose nutty superstitions are completely baseless. They conclude that because John incorporates the Sun and Moon in his research that this automatically justifies anything and everything that relates to the solar system or some book that was written while the author was presumably taking a break from burning witches – or whatever the appropriate historical and/or cultural equivalent was.

      1. Anywhere in the world has its myths.
        Myths maybe just a fiction, but if it is true?
        We can not superstitious, but you can not ignore them.
        Why is it so useful, Lunar?
        The moon belongs to Lunar.
        The sun is the solar calendar.
        The moon and the sun looks almost the same size in the sky.
        Why people feel very strange?
        Curious does not mean superstition.
        Otherwise, we might still think the earth is square.

  92. I really appreciate the content in this blog especially unique ideas like what Andre’ is working on, and appreciate the humor as well such as when Nicolas reminds us all of how successful he is at trading. I myself am working on a technique suggested to me by Andre’ looking at accelerated moves up or down every 14 days as the moon moves over the equator north or south. If it wasn’t for this blog I would not have known about moon declinations and for what it is worth there are ways of making increased returns by trading them. By my count 2/3 times over the last 15 years one day after the moon crosses the equator towards the southern hemisphere until it reaches maximum southern declination the market finishes lower. I definitely appreciate Eclectic, PimaCanyon, SJC, Andre’, Steve T., Slim, Peter and all the wonderful members of this online community and hope that it continues until we all have superior success in the markets.

  93. John has done some fantastic post reports, this is the only site I know which represents a true reflection of the current situation, offering past and present facts backed up by some compelling statistics.

    The sad truth is the fact some dominions come on here to cause havoc and division which incites emotional feelings.

    Great sites like this are ruined in that way, just because they offer an alternative view which is counterproductive for 1% of the worlds population.

  94. Short post now. Reasons:

    A) This blog already generated too many responses
    B) I’m working on a new type of tidal analysis.

    The october 16 low was an important one. And I just had to understand how gravity and the tides pulled this off. And I just may have found the answer. Before I say more about this I want to run some tests, because some people get upset if you don’t get it 100% right. So I need next week to do some more work. Looks really promising!

    I’ll be back!

    Cheers,

    André

  95. Thanks for all the comments. Understandable there is emotion flowing, it’s either last chance for the bulls or the bears. Just please try to stay respectful to each other. It’s an open board and I’d rather only intervene as last resort.

    New post is out.

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