In Perspective

1. The start of January brought the shift to defensives, measured here in 4 ways: stocks to bonds ratio, cyclical to defensive sector ratio, small caps to all caps ratio and high yield to treasuries ratio.

9nov10Source: Stockcharts

2. The best performing sectors in 2014 all year have been health care and utilities, the two defensive sectors that perform best once the stock market peak is in.

9nov15Source: Macromon

3. The yield curve, measured here by 2y versus 10 yr treasuries and 2m versus 10 yr treasuries, has flattened ever since 1st Jan. We won’t get an inverted yield curve under ZIRP so flattening takes over as a topping warning.

9nov114. The best performing asset class in 2014 has been government bonds and the chart below shows this has been a global phenomenon (Germany, Japan, UK and US quoted by 10 yr yields (bonds inverted)), again since Jan 1st.

9nov85. Looking at stock market breadth, deterioration has been under way since almost the turn of the year in the Nasdaq indices.

9nov126. Whilst the NYSE, SP500 and Dow picture reveals breadth issues since the turn of July. We can also see there was an earlier bad-breadth run into the turn of 2014 which was subsequently repaired: like an attempt at a bull market peak but it wasn’t quite ready.

9nov137. Turning to sentiment, NAAIM manager exposure to equities has been dwindling since Jan 1st, whilst Investors Intelligence bulls made a double peak 1 Jan and start of July, since which they have dwindled too. Meanwhile, Vix made its low at the start of July and has been in an uptrend since then and Skew has stayed elevated for a year, with triple peaks in Jan, July and Sept.

9nov148. Commodities have been in sharp decline since the turn of July, as the US dollar sharply rallied, in a deflationary wave.

9nov69. For US earnings, a rising dollar and falling oil prices is overall doubly negative. Q4 earnings growth has recently been accordingly cut in half to 4.5% and sales growth cut in half to 2.2%. Earnings growth has missed target in each of the first 3 quarters of this year. The average of 5 valuations puts US equities the joint second highest in history after the 2000 mania. There is a big gulf between price and earnings.

10. Global stock indices look like this. European indices peaked out by the start of July and have since made a lower high and lower low, the definition of a bear trend.

9nov2

11. The Hang Seng, Bovespa, Kospi and Australian index all made peaks at the start of September.

9nov4

12. However, the US SP500, Dow and Nasdaq, as well as the Japanese Nikkei have all made new marginal highs since then.

9nov1

13. The Russell 2000 double topped at the start of March and start of July, whilst the overall Dow Jones World double topped at the start of July and start of September. Junk bonds and leveraged loans also made July/Sept double tops and lower highs and lows since.

9nov5

Across all the above charts in this post, three dates consistently stand out: the start of Jan, start of July and start of Sept. The topping process began the 1st January and additionally the Sornette bubble end flagged on the SP500 at the start of July and on Technology at the start of September. Insider selling peaked at the turn of the year and we have seen six major distribution days since then without any major accumulation days. Put/call ratio, bullish percent and the summation index additionally point to the relevance of the start of Jan and start of July:

9nov19

Now draw in the solar cycle. The likely smoothed maximum was April 2014 (based on SIDC, Solen, NOAA, IPS and polar switch). Here’s why the smoothed sunspot maximum is important, it generates peak speculation events:

9nov22

Either side of the expected smoothed solar maximum of April 2014, we have two seasonal peaks (inverted geomagnetism peaks) of turn-of-year and mid-year:

5nov40

Homing in on the new moons of those two periods we get specific dates for a triple peak confluence of speculation/optimism: 1st January 2014 and 27th June 2014. I believe this is a compelling cross-reference for all the market charts above. We see multiple index and indicator peaks clustering at the very start of Jan and very start of July (both within two trading days of the new moon).

So I maintain this is the true picture of where we are, mirrored on the last solar maximum stock market peak of 2000:

30oc6

30oc5

And I still expect stocks to reverse here like they did at the same point in 2000:

9nov17

We have had several days of small range consolidation with a slight upward bias (averaging the 4 US indices), whilst sentiment and allocations are bumping up against invisible limits. I therefore believe the next move is down, like the subsequent red candle above. Furthermore, I believe that is then the end of the topping process in global equities. It effectively ended at the start of July, and really did for various indices shown further up, including the overall Dow World. But we have now seen new highs again in US large caps which on the surface look bullish, but underneath not.

I believe the unprecedented extremes in levels and durations of price levitation, sentiment, allocations, leverage, tail-risk, and negative divergences mean a crash is coming. Like an elastic band stretched to the limit. The superficial 2014 bull trend in US large caps is nothing of the sort under the surface, but has served to fool most into a false sense of security. This last rally from October to November has sucked everyone in again (sentiment, allocations) and we have extreme lop-sidedness in the markets. I believe equities will tip over here and fall hard and fast, with no reprieve this time. No dragging on until year end: the megaphone formations on the US large caps are ripe for resolution now and overbought/overbullish indicators support this.

7nov120

The October monthly hanging man candles suggest November should be a significant down month. I maintain the view that the evidence is too compelling now for consideration of an alternative scenario. If you remove me from the equation then there is an awful lot of fact in the above charts and many other recent charts that I have relayed that a bull needs to explain away. Simply, too many. However, we can argue there is a middle position in accepting all the warning flags but predicting prices can still yet go higher into year end under dual positive seasonality. Perhaps a scenario of increasingly thin volume and increasingly bad health but still scraping higher.

The problem with that is that whether we look at Nymo, Rydex, II, AAII, RSI or the ascent and shape of the Oct-Nov rally we see the same tell: exhaustion. Stimulative action from the BOJ and ECB in recent days have failed to catapult global equities higher. So I believe the middle position’s best hope is that equities retrace away from these exhaustion levels but then quickly washout, to enable a December rally into year end. However, I would refer you again to our positioning in the topping process. There is no case for another rally. If we tip over this week I believe that is it: equities won’t come back again. This is what I expect to happen.

Screen Shot 2014-11-04 at 07.53.54

SP500 Monthly

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102 thoughts on “In Perspective

  1. Great analysis; thanks.

    I have 2 lines of reasoning.

    1) My 15/6 109cd cycles structure indicates 2014 was the year for a high with july 28 as the most probable date for the high. So if this cycle is down, we have witnessed the end of the bull run from early 2009 and we will see at least 6 109cd cycles down into 2018.

    2) The gravitational trend is still up as argued yesterday and points to feb 5th as the most likely date.

    Combining these I see the middle position you refer to.

    A strong decline needs gravitational support; I am very convinced of that. But when a longer trend has turned, gravity can’t deliver ATH’s.

    So my most likely scenario is a very round topping process that would confirm both your unique analysis and my gravitational forecast. No rallies anymore but no crashes either-yet. This combined analysis also explains the consolidating year we have seen; two conflicting trends neutralizing each other.

    November 15th is a major date as it ends the first 110 day cycle down after the july timing. It explains the firm decline into october. Counting back 27,5 days from nov 15th we get Oct 18th, 2 days from the low.

    This 110 day should be down. The only reason for the swift recovery is gravity; the market isn’t ready to let go yet. The next 110 day cycle gives march the 5th. but any 27,5 day cycle can be a timer.

    So February 2015 is a very important month, between Feb 5th and March 5th.

    Anyway; the light you see at the end of the tunnel is for real. It is coming so close we should be able to smell it soon 😉

    Just my thinking; that’s all.

    Cheers,

    André

    1. Andre’,
      Thanks, I believe you are putting together some important pieces. I have a question. I understand how you derive your dates, but the comment “6 109cd cycles down into 2018” I am unsure of. Yes it would be at least 6, a lot more unless I am missing something. If the start is 7/28/14 then it would be 12 to 14 into 2018 (depending on when in 2018). Are you taking the decline from 11/15/2014 or 3/5/2015 (that would still be 10 to 12 109cd), or is there something else that I am missing. Are you looking at the up and down moves as 109/110 days? Thanks in advance,
      SC

      1. Steve,

        I now basically have 2 independent timing systems:

        1) the harmonic 15/6 109 day cycles structure
        2) Apogee cycles.

        History shows the market turns when both systems have turned. In 2006 Apogee gave the high in December. But the market kept going as the harmonic system was still completing the 15 count. That’s why the high came 2007.

        At the 2009 low the two systems were in sync; almost to the day. This created a sharp v-turn.

        Now in 2014 the harmonic system is ready as of July. But now Apogee isn’t ready yet.

        So only the combination of 2 systems gave the 2007 high and 2009 low reliably. That’s why I expect the market to stay in a topping process until the Apogee cycle is finished.

        I said we will see at least 6 cycles down. I assume this structure gives 15 cycles when in sync with a longer wave and 6 when retracing. So it is either 6 or 15. And then Apogee must confirm this. By the end of 2018 apogee gives up and 2020 even more. This indicates a longer term cycle is still up.

        I am looking into up and down cycles. But now the market is wobbling as the 2 systems are out of sync. Once Apogee has turned is will be easier.

        1. P.s. You are right with the timing; 6 cycles won’t push us into 2018. The 15/6 structure is leading. I will recalculate the timing.

    2. Andre,
      I was stunned to see your top date of february 5, as I had just calculated an annual
      “up, then peak, then down” cycle top date, along with a once every two decades
      “major up, major down” cycle top date – and they both peaked exactly on February 6th. Do you have a website where you post your work, where I could learn more, and post full details on these coinciding cycles? If not, you could if you wish provide me with your email address, and I’ll describe these cycles and also post some useful cycle links. My address is nlv44@oplink.net.

      Nick V

  2. Thanks John.

    “Stimulative action from the BOJ and ECB in recent days have failed to catapult global equities higher”

    The old ever diminishing returns. I think we could see some big moves in Asia this week. Particularly the Hang Seng. DAX daily action also beginning to look decidedly bearish.

    Cheers again.

  3. Medianline sets are old school technical analysis… old school in the sense from the time of better known Elliot and Gann.For my own trading I keep it simple and only use standard,gap, and modified schiff sets. Price at a line will do one of 3 things… reverse.. coil.. or accelerate, for my own trading I look to see if one of the handful of algos I trade triggers when price at line…no algo no trade. With the indexes.I am VERY focused when despite the fact they measure different things they all come together at key lines at same time… such is the case now

    tna

    http://stockcharts.com/h-sc/ui?s=TNA&p=60&yr=0&mn=11&dy=0&id=t50520700041&a=331801219&r=1415535661430&cmd=print

  4. UUP-everything I know the computers that run the markets know… what I do different from most traders is archive and study and trades simple patterns I have seen the computers use countless times…. Traditionally taught, three pushes to a bottom is taught as a sequential move… about eight years ago I started showing a setup I called DBS… OVERLAPPING 1.27’S….the trade is triggered IF and ONLY IF a line drawn through first two pivots intersects the 3rd pivot at the overlapping 1.27’s….does not get more exact than this….
    As stated before, it is idiosyncratic to the red line green set that the odds are based on just a move to the medianline…. after that other geometry must take over to launch price to the upper line.

    http://stockcharts.com/h-sc/ui?s=UUP&p=D&yr=1&mn=11&dy=2&id=p08418747146&a=370190465&r=1415538631683&cmd=print

    1. Again Thanks for your charts and tutoring …………….i appreciate all the talent with all these charts as l’m sure all do………Elvis i addressing you too

  5. What about the significance of all these indicators for the US-Indices if the money of the world is turning to the US ? As Chris Puplava just stated market breath has regained its bullishness in recent weeks.

    Schaeffer’s Monday Morning Outlook stat:
    When the SPX returned more than 5 p.c. from May until October (14 incidents in 49 years) the average return in the following period November through April was about 10 p.c. Positive returns occured 86 p.c. of the time.
    I think that is the preferable perspective should the next week not end decisively negative.

    1. Regarding breadth, I show 3 measures above for the different indices, all diverging: summation index, advance-declines and stocks above 200MA. For small caps here is stocks above 200MA:

  6. The variation in the Sun’s motion about the Center of Mass is characterized by a periodicity of 178.770 years: Every 16 loops about the barycenter the Sun repeats a very similar path. The slight time derivative or torque to this 178.770 year cycle, a time dependant periodic function of +/- 1.05 years is called the torque cycle, determined by nine subsequent synodic periods of Jupiter and Saturn (9 * 19.858 years = 178.720 years) and used by Theodor Landscheidt to forecast sunspot cycles. The projection of this 178.72 Year Cycle (+/- 1.05 years) from the peak of SSC #8 in March 1837 suggests the peak of the current SSC #24 is still ahead of us and would occur in 2015-2016.

  7. Yes.

    In 1835 the market peaked 23-months BEFORE the peak in SC8; assuming the peak occurred on April 29th. Or if you want to use August, 1835; the market peaked 19 months before SC8.

    But, the market peaked in September, 1929; some 16-months AFTER the peak in SC16.

    Either way, a case can be made, just using this variable, for higher index levels in the market?

    1. I agree with your approach of looking at these older cycles eclectic. Our little planet has witnessed hundreds of millions of solar cycles, but we only have contemporaneous sunspot numbers for a tiny sample of 23 completed cycles.

      So it seems prudent to me to study as many of that tiny sample as possible, especially those cycles most similar to the current one. John’s chart above of cycles 20 to 24 shows just how different the current one is in amplitude, shape and duration to the ones we’ve been used to during our lifetimes.

  8. Mercury retrograde max elongation just finished, bearish 20 td. Saturn opposition coming up in 10 days, bearish for one month after. Seasonals weak until US Thankgiving week. Lunar Edge kicking in tomorrow to last 14 days. Market being propped up by dollar rise and flight to quality. Declination N to S starts 11/9 weakness 14 days. No clear bias next two weeks because of the current trend of US being the only winning horse. I guess market to have rounding top until end of November. Minor sell off in December. Major sell off next February March.

    1. On Saturday the moon left earth’s orbit and is now adding miles to the distance fast. So this provides a clear upward bias into Wednesday, as the longer term gravity cycles are still up.

      On Thursday the moon comes under the spell of Apogee and slows down (relatively). It stays in this position – with low but stable gravity – until Monday 17th. The tides give a high on Saturday; exactly at Apogee. This same day also gives a high tide inversion. On Sunday Neptune turns direct. This marks the turn of a 27.5 day apogee cycle that will push down the markets into December 12th/15th.

      I think…

    2. Betafish,

      Having just calculated the top dates of two very obscure cycles, one annual and one multi-decade, and both picking February 6th as the nominal top date, I was stunned to see that Andre had February 5th – and you’re calling for a major selloff starting in February. Do you have a website where I could read more, and post the
      cycles I’ve got? If not, I could email the analysis to you as well as some very useful links. My email address is nlv44@oplink.net. I also have a lot of 20th century
      astro techniques that still come in handy fro market timing, despite QE, that I would be happy to share.

      Nick V

  9. From Peggy:

    This is an hourly “snapshot” of the gravitoelectromagnetism that spirals around the earth for the time period beginning at midnight tonight and ending at midnight on 11/11. This spiral defines a path for market prices as well – on 11/10 up to 2 or 3 am est, down to 9 am est and then continuing up through the close.

        1. Each blue square is one hour. The GEM spiral path starts on the left 11/ 10 at 00:00 est, curls upward 3 squares until 2:00 (to 3:00) est = high. Then the spiral travels downward until 8:00 or 9:00 am est (each square = 1 hour). Then up through the rest of 11/10 with largest gains (space between squares) after 11 am. Hope that helps.

          Peggy

      1. Peggy,
        I like your GEM approach. It also provides a theoretical basis for incorporation of other planetary effects that are (perhaps) too far away to impact through gravity. Good luck in your research. Can I ask what makes up your data field in the construction of you GEM data points?
        SC

        1. hi SC
          I acquired the hourly Spiral data from 7442 Analytics, which is derived by an array of NASA data. I’m told they did extensive research on the effects of other planets and found no consistent correlation to price.

    1. Wow, this is one unique way of approaching the markets especially from a day trading perspective. I am quite intrigued so I will follow the intra day action closely tomorrow. Thanks Peggy for your valuable contribution.

    2. Last night’s high of 2029.5 was established in hour 23:00 and has been retouched this am at 5:00 and 7:00. The “low” of 21.00 in hour 22:00 is expected to be retouched by 9:00 am. Then the upward movement begins and gets stronger later in the morning and continues to the end of the day.

    3. Didn’t do exactly the inverse of this?

      Not criticizing, just bringing up the big problem with anything to do with the moon and geomagnetism. It’s not that there isn’t an effect — clearly there is — but often it is exactly OPPOSITE to what you expect.

      It’s all right, or all wrong. That makes it hard to trade.

      1. no, not the opposite. there was a velocity move at 23:00 which is a separate dimension that I didn’t post but will going forward – the extremes of the GEM create highs and lows and especially in a narrow range it will be not as easy to see. I’ll post frequently enough for it to become clearer.

        1. the “upward movement begins and gets stronger later in the morning and continues to the end of the day” – wasn’t that exactly right?

  10. I’ve addressed this a few times now but it keeps coming up. Yes, there is the possibility the solar cycle is anomalously long, and yes there is the possibility that the stock market anomalously peaks out some time after the solar max. But both are anomalies, not the norm.

    On the solar side, 5 main models are united in it being behind us, plus non-anomalous solar cycles would now be in waning. On the markets side, we have all the evidence in the post above that points to a topping process that began in Jan and effectively ended in July, which brackets the likely solar max of April 2014. Add them both together and there is a compelling cross-reference. It’s a matter of probabilities until it is certain with hindsight, but it’s a strong case so I am betting on it.

  11. I have zero understanding of the solar cycles. I say institutionals still have shares to unload to the public but the public is not buying, the public was burned alive in 2008 ( those who sold especially). so I think pros at big firms, banks, collude with the CBs to delay as can be another 2008. kicking the can as long as can be. will market gravity have the last say however or them ? then again a lot of pros sold and have a lot of cash ready to scoop stuff cheap. so…. I think this will drag down but in 2015 we see crisis from Europe, default(s), euro cratering, emergency meetings etc. i keep pointing at DBank and its 55 trillions of euro derivatives…
    and its exposure to southern States. anyway how much higher, on ever decreasing volume ( except in Oct when it corrected 10% almost) can it go ? what is the risk reward to remain invested except in some super high dividends stocks ? the REITs were not affected by the October correction: they are boring but yielding.

    1. Ton of building going on north of the Golden Gate in California. If banks start no money down programs, it is Katy bar the door. One developer is putting in 500 new homes within next few years and this is a smallish suburb of SF. Real estate is cyclical but I guess they aren’t building any more land.

  12. Captain Obvious reporting here again. Anybody else notice this coincidence?

    SC8 = stock market peak in 1835
    SC16 = stock market peak in 1929

    A natural progression for the next stock market peak could then be expected to occur sometime during SC24.

    1. Eclectic,
      Nice! I wonder what SC-0 would be or what economies were doing. SC-0 (yes, I know, there is probably no such nomenclature – I made it up). This SC-0 would have occurred in the 1740’s. During this time British population grew slowly, increasing quickly after this period ended. Also, toward the end there appeared to be pressure on iron prices, with Britain outlawing the production of iron in the colonies to protect the British iron industry. Slavery in colonies increased dramatically.
      SC

  13. John, thanks again for providing yet another riveting installment. Where do you find the time…

    From perusing the research it builds a very persuasive case for an imminent market drop. The question remains as to just how imminent? It would seem to me that if the market rose over the next 1-2 months and then fell in the manner you predict, this would still be in keeping with the overall narrative of the charts you present – especially given the drivers presented to underpin your view are medium to long term.

  14. “China approved more than $100 billion worth of infrastructure projects in late October and early November, state media said on Saturday, in a bid to bolster slowing growth in the world’s second largest economy.” Cam Hui, Humble Student of the Markets, is cautiously bullish based upon dovish comments by Draghi, lovey dovey Sino Japanese discourse, and Chinese stimulus. What to believe? I am just going to trade seasonals, lunar edge, apogee weakness, and declination until I get chopped up or start winning. Cam’s calls have been reliable last 12 months on his charts that he publishes. Although he is only investing in healthcare which seems to indicate that he is bullish but not with his money in the broad markets.

  15. Andre’,
    Thanks for your response above, gives me some meet to feed on for some ideas that might help regarding how the 110 calendar cycle potentially connects larger and smaller cycles.
    Also, your comment: “So February 2015 is a very important month, between Feb 5th and March 5th.” Many months ago, and since, I have commented on the importance of being aware of the Saturn-Uranus cyclic relationship. I indicated that the next time it turned Retrograde would be the middle of February, and the speed of the angular relationship would go to 0* 2 weeks before/after exact. This may be an interesting ‘confluence’ of separate and independent events.
    SC

  16. Steve, I believe you brought the 7 year top cycle to my attention. The best cycle I have seen is the 4 year cycle bottoms in the 1950’s to 1962, 1966,1970, 1974, 1978, and 1982. It hasn’t worked so well since then. The utility average has been rather remarkable for that 7 year top. 2014 should be a topping year for all indices with the utility average topping in Dec 2007 or Jan 2008. Seven years ago it topped in Jan 2007/Dec 2008. Same in late 2000 (other indices topped earlier). Ditto !993 (Sep not Dec) Again late 1986 then fairly good in late 80 and again in 1973 – when the Dow started a severe 2 year bear market. The utility average is rather precise. The other indices seem to orbit around those year end tops.

  17. $/Y has a typical topping pattern of 3 peaks at major highs – looks like 3 as of this morning (compare to 4/1990, 8/1998, 2/2002, 7/2007) – average down-side from top 7.8% in leg one or 106 and time 1-2 months.

  18. Every day a new “event” or “statement” that the markets rally on. Seems to be no end in sight. VIX is in free fall compared to small gains in S&P. Might still roll over, but crash chance is waining.

  19. Thank John. After being with your blog for a while, I has discovered the pattern of gold. Gold is bearish so long recommended. Waiting for Full moon then I short on Monday if gold has been up a bit. Further filtering could be Mars and Moon declination but I not have a double check yet. Before coming to your blog, I saw gold usually down big on Monday but I needed more filtering. Now I found it. All in all, it is Monday, it is fullmoon, it is Mars Negative Declination , it is Moon Positive Declination and gold going up for a while then shorting gold is highly recommended. Cheers !

  20. Isn’t it rich, isn’t it queer
    Losing my timing this late in my career
    And where are the clowns
    Quick send in the clowns
    Don’t bother, they’re here

    diverge, converge, concur and progress
    zero sum recipes and cannibal stews
    served cold to a people ever told
    they can’t lose

  21. You will recognize the pattern of SP500. Monday and Thursday are the turns. If Monday bullish, it likely be bullish for the whole week. However Sp must be down to march with bond. Seasonally, Sp should correct a bit in order to rally EOY. So it is the last week for SP up, 2 cents

    1. I also have noted Nov 13 as a somewhat important date. It might have something to do with the upcoming lunar apogee on Nov 15 (Sat). I reviewed all of the past apogees for 2014 and this was the general observation. If the market is in a decent uptrend heading towards the apogee date then it potentially could top out and reverse for a correction or continue to rip towards higher levels. If it does happen to be one of those topping/reversal scenarios then it typically records the high about two TD’s prior to the apogee date.

      The one apogee date of Oct 18, 2014 (Sat) had the markets in a steep correctional decline heading towards that date, and in that scenario it marked the bottom/reversal as it recorded the bottom about two TD’s prior to that apogee date.

      I previously noted that Fri Nov 7, 2014 offered potentially a decent opportunity for profit taking hopefully in the 2040-2045 range but SPX never got to that range despite the jobs data news. Based on the past six V-shape recoveries in 2014, I previously noted that markets at the minimum made a higher high 20-25 points relative to the previous 52-week high. The Sep 19 SPX high was 2020. So going by both the apogee info and past V-shape recovery data, the probability is quite high that the markets continue marching forward this week to at least a slightly higher high than today.

      1. Thank Steve. On Nov 3 Sp down 24 points so for a measured move, 2050 is a target. For 10 years, if you long EUR/USD from Nov 12 to Jan 12, a decent profit made. Wonder this works again this year. Coincidently with SP top ?

  22. My 2 ftse longs doing great, still waiting for a drop below 2000 SPX to trigger shorts. First one at 1974. Might put in a forth short in at 1995.

    It looks too good to be true, safe and making money for now, I realise that can change at any moment.

    1. Yes Aaron. It CAN be too good. Just take your FTSE profits and sit around for the trigger shorts.

      Sometimes the market DOES give you a piece of cake AND want you to eat it too.

      Congrats on your trade. Well Done.

  23. Hi Aaron

    The FTSE has arguably cleared the 6600-6610 resistance – hopefully it will gain some strength from that, will be looking tomorrow:)

    J

  24. John,

    Your analysis is good but we dont see any reason why we will get a sell off. Also none of the past NYMO cases (above 80 twice in a week) had the market gone up, this time surely looks different.

  25. Bill

    Who is “we”?:)

    Everyone is wrong more often than not, we can see that from the calls made by pretty much everyone on this blog, including me. The trick is to survive when you are wrong and profit when you are not. No one is suggesting that you follow anyone else’s advice….:)

    Good luck.

    J

    1. Or stubbornness or even outright refusal to admit mistakes. Market has the tendency to push those out of extinction very quickly.

  26. Bill, I agree with jegersmart… Who is “we”?

    I agree with John that a topping process began early this year. Can it go a little higher in December? Again, agree with John it certainly can although not as likely. And further agree that the higher probability is a top has already been made in several of the US and Global indexes and that the DOW, S&P, etc. are soon to follow.

    I would also reply that your “this time surely looks different” is the exact sentiment that marks tops… i.e., you’re it. the contrarian indicator.

  27. Well, the Rusty has shrugged off the retest variation sell candle pattern, median line set resistance and overbought momentum and looks to be making a break over the garden fence:

    http://scharts.co/1xErxGr

    When a setup fails and what “should” happen does not, we can usually expect a move of similar magnitude in the opposite direction.

  28. “And further agree that the higher probability is a top has already been made in several of the US and Global indexes and that the DOW, S&P, etc. are soon to follow.”

    Well, either it will or it won’t but there are always ways to make money….

    J

    1. There’s no way to know for sure until it’s in the hindsight. Christmas rally is likely to a positive catalyst in the coming weeks. But who knows, this year may be different.

      Good luck to all for the remaining few weeks of the years.

  29. From Peggy:

    “Adding a dimension – the 2nd series shows the times of greatest velocity. Both GEM paths begin on 11/9 at 18:00. Each square is one hour. Greatest velocity 11/9 22:00 to 23:00 (then consolidation), 11/10 3:00 to 6:00 (then consolidation), 9:00 to 11:00 (then consolidation). The 1st series shows the directional path.”

  30. Bretz 5 day additive TRIN gave an SP SELL signal at close today. Sell triggered when 5 days of closing TRIN total less than 4.0. 5 day total today 3.75. Last sell signal given on Septemebr 17, 2014.

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