Solar maxima generate speculation peaks. The latest smoothed solar maximum is likely to have been April 2014. The chief speculation target has been equities, particularly US equities. That mania is demonstrated in valuations, sentiment, allocations, leverage and more. A speculative mania has indeed been delivered at a sunspot maximum again.
The chart looks like this:
If we substitute the Dax for the SP500, the aligned peaking looks clearer:
But where is the subsequent collapse? It really has to occur within the window January to April 2015 to be both within acceptable range and normal seasonality, with the latter guided by the sun’s second tool, geomagnetism:
As things stand, the set-up is as compelling as it could be for this to occur. Global growth proxies, oil and copper, are collapsing. Bond yields are reaching for record lows and yield curves flattening. Volatility is in an uptrend. The US dollar has surged in a deflation wave. Earnings forecasts have been slashed on the moves in oil and the dollar. Plus, the key ingredients for a collapse remain in place, namely excess leverage, very lopsided sentiment and allocations, and a wide range of negative divergences.
Additionally, the real (actual) geomagnetic trend has intensified since August 2014. Here is the commodities index versus trend geomagnetism for the last 6 years. Note the geomagnetism is inverted as higher geomagnetism is negative for sentiment. We see geomagnetism has helped drag down commodities over the last several months.
However, when we look at equities, we see them levitating away from the model in an 18 month mania:
Combining equities with commodities we see the mania from another angle:
The similarities with 2000 are notable. Back in 1998-2000, we saw a similar pulling away from the geomagnetic model. Eventually stocks were dragged back to it, in a post-mania bear:
Note how the geomagnetic trend intensified downwards in the second half of 2000. This would have played a role in popping the uptrend in equities, as it tugged downwards on sentiment, and ought to play the same role now given the steepening over the last several months.
I maintain the parallels with 1937. Ultra low rates and QE, deflationary pressures, excessive valuation into the next solar maximum following the demographic peak. We should be heading for a major low in equities several years from now at the next solar minimum. Top chart from S. Tarassov.
S O L A R C Y C L E S 
This sentiment & allocations aggregate (II and Rydex) is a good proxy for the speculation waves of last 2 solar cycles, mirroring the sunspots chart:
“Most risk markets have gone into a V since about June.” -Gundlach
Read more: http://www.businessinsider.com/jeff-gundlach-webcast-january-13-2015-1#ixzz3OnCI0brg
Thanks John, Looks very convincing to me. They say that commodities have their own cycle, Most peaking in 2008 and 2011, a ten year up cycle and then a 20 year down cycle, which would mean we have a lot more downside to go, dragging the stock markets along with it.
We had a nasty reversal day today. So we await to see what happens soon.
John, when you mention an acceptable range between January and April 2015, are you referring to 1937/8 v 2014/2015 timing? With SC17 and SC24 SSN peaks both occuring at the same time of year (April/May), and the final Dow declines happening in March 1938, then that accords nicely with your acceptable range.
Dow lost an overall 47% during the 1937/8 bear – a percentage which regularly pops up when looking at post solar max declines. But it had already lost 40% between August and November 1937 before the final March 1938 decline, and the fact that similar declines didn’t happen during H2 2014 is a major difference between the 1937 scenario and now.
I may have already commented on this, Mark, but it seems over the past month your view of how the solar cycle will play out has come into greater alignment with John’s. (Not surprising given the time that has passed.) How do you view this H2 2014 disparity? Critical? Does it mean the date of the waterfall declines John is expecting should be pushed out in time, in your opinion?
Comparing SC24 progress so far to previous cycles Gary, I still think there’s an 80% probability that a truely manic phase for US stocks is ahead of us, most likely continuing to around September 2015 or early 2016. As for the other 20% chance – a crash/ severe bear market must start during Q1 2015 (in fact, preferably before 9 February), or else it will not get started for at least another 9 months.
It does look as if the markets are going through a major shaking-off period now, in preparation for a big move. If SP500 holds up reasonably well until early February, and January’s ISN (monthly sunspot number) does not crash, then I will change my 80% probability to at least 90%.
So my view is that the H2 2014 disparity very likely is critical, but that the next few weeks will make it clear one way or the other.
Great brief, Mark – thank you
Thanks Mark, I believe that another strong push on the SP500 is due (after this small drop Jan-Feb) before a starting waterfall Sep-Oct15 into mid 16. Great synopsis.
Cheers
Thanks John. Many analysts are blaming the collapsing oil price on a price war……what say they RE copper now plunging to new 5 and a half year lows and looking likely to test $2 a level not seen since the height of the GFC?
Allan,
Analysts will blame the weather if they can get a chance. All they have to do is to look at the real data that is in front of them, look back at history and ensure mistakes are not made – easy right!
UK and Aussie markets in virtual lock-step since mid 2014. Neither market are strongly reliant upon the other in that the Aussie economy has stronger dependance upon the US and China, yet they both are front running the rest of the world?
http://stockcharts.com/h-sc/ui?s=$FTSE&p=D&b=5&g=0&id=p57803001800
http://stockcharts.com/h-sc/ui?s=$AORD&p=D&b=5&g=0&id=p46680982171
I guess the question is. What do they both know that the rest of the world hasn’t quite yet caught on to, given that both these markets are exhibiting much weaker charts?
Allan,
Being an Aussie, our traders are less likely to take risks on stocks that have the potential to lose based on any dollar fluctuations, mining (which is moving from the research drilling into production phase – big job losses happening now) and retail due to the waning consumer confidence. They see stocks where they are now and where they will be in 2 or 3 months only.
Our market ‘as you say’ has been marking time due to falling commodity, waning consumer confidence and a company’s ability to rise above these strong influences.
I think the Aussie market is already on the way down.
My thoughts only
The FTSE in particular looks awfully close to the S&P price action around late 2000. Nearly a full year of distribution and choppy breaks lower. I expect 5,000 sometime this year for FTSE.
The whole world trades those markets, I am pretty sure that no one “knows” anything particularly within the countries in question…:D
J
J, quintessentially all markets can and do most times, reflect underlying disturbances that are not in the first instance necessarily evident to investors on the surface for some time. This occurs time after time.
My point is that both these markets are at a similar juncture in terms of how advanced their now on-going declines are compared to most of the rest of the world and yet neither is overly connected or dependant on the other.
One of course is largely commodity dependant whereas the other is largely service finanially dependant.
So IMO they are both signalling something similar but from different perspectives.
Cheers
Head and shoulders neckline to be taken out decisively on the open, follow through confirmation will target Oct lows and clearly establish a new trend of lower highs and lows.
http://stockcharts.com/h-sc/ui?s=$SPX&p=D&b=5&g=0&id=p71846539008
Allan…the S&P logarithmic chart depicts the low so far today finding support right on the neckline….here it is: http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=11&dy=0&id=p72948436131&a=307662600&listNum=1
I’ll admit that this market appears to have more lives than a cat lol. How it managed to hold that neckline at the open is testimony to the bulls resilience but it doesn’t have many lives left if any at all.
A crude example of traders reversing longs.
http://shadowrider-07.deviantart.com/art/50-Car-Pile-Up-101845455
Let see if it’s another buy the dip
It certainly isn’t a good sign for bulls that even with the ECJ’s positive opinion markets are selling off. Markets certainly got a temporary boost overnight but now…Nicolas, how do you read things now?
I was traveling all day yesterday – driving 14 hours….
If anyone is curious…not as much fun as you might think….*shaking head here*
So…..what’d I miss?? 🙂
Anyway, Hi Gary….
I’m not Nicolas, but my guess would be something like this:
*blah, blah, IBB, blah, QE, blah, my research predicts big central bank buying during 2015, so it should be another excellent year, blah, ECB, blah, BOJ, blah, new highs, blah, Who’s stupid enough to buy a gold stock?, blah…..”
But to be fair to Nicolas, he ~is~ right about one thing…..
For me, two weeks in…it’s ALREADY becoming an excellent year…. 🙂
He nailed it!! 😉
Backing/Filling/Bounces along the way notwithstanding, I am currently still bearish…
GL
Nicolas may be doing more research, not sure…
Lol, now now boys.
Okay, I actually did just laugh out loud… 🙂
But wish he’d make that phone call to Janet and get her on the ball here…
I’ve got a piece of property I really would like to sell before things get out of hand…
Concerned Kent may just be on to something… :-O
Might be good for people short stocks, but for everything else in our lives, not so much…
In 1980, oil peaked and the dollar bottomed. It did not seem like any big deal at the time. However it set in motion economic forces that resulted in collapse of the US savings and loan industry around 1986 and the Mexican Peso crisis of 1994. Citicorp and Goldman also had to be bailed out then. From an article in Seekingalpha by New Low observer. Why will it be worse this time over the next several years? Due to the extreme amount of mal investment caused by artificially low interest rates and manipilated high oil prices. Plus China’s extreme mal invest along with emerging economies, soon to be called submerging economies. The Dow fell from 1000 to about 800 from 1980 to 1982, even though it was extremely undervalued (pe 6, yield 6%, and at book), like 1937 as well. Now we are as overvalued as ever by many measures!
The PPI comes out this week. If it is -.042 (5% annual rate) or worse it officially signals a deflationary spiral which is what happened from 1930 to to 1932, 300 to 40 on the DOW. The mkt high was 386, but 300 was after the original crash, rally back and then long term decline. Could we be on the verge of the initial crash, rally back, and then long term decline?
A lot of good things to think about there, Kent…. Well done…
I think John Li yesterday said that we were completing 2nd chance and waterfalls thereafter. If Dec 6th low doesn’t hold then that scenario looks very likely.
Thanks for that. I do think SPY is in second chance, but second chance need not be long because DAX and others iterated above are post-second chance. Still, we have enough events ahead of us — option expiration, ECB, FOMC, holiday effect that I think there will be some two-way action.
I was short yesterday and taking profits today.
The PPI was released today and fell at -.3, which is less than the -5% annualized rate needed to signal a deflationary spiral (Strategic Investment Timing by Dick Stoken).
Pegasus, where are you expecting Yen to trade? This latest move up is eye opening.
Looking for 111 for a sensible support Gary. This will leave the door open for Bulls on $/y. That would be sp500 1900. There is a gap also.
BTW, my research suggests that Mario Draghi and Janet Yellen are about to elope.
I stand by the source too!
Oh god, they’d make more CB’ers!! We’re F-ed!!
Andre,…Not bad so far….
selloffs aren’t gonna matter much til biotech caves…. unbelievable
I hear what you’re saying, but “my research” on this would indicate that sometimes it’s a leading indicator……other times it’s not….
No way to know which is which ahead of time…
They will probably hold up in January since they are small caps.
Moon is in scorpio today until Friday. Many steep sells offs historic occur when moon is scorpion. I am in cash. Would be short but Lunar Chord is 2/3 positive and seasonally this week is above average.
I’m not the expert for sure on this, but I thought I read here a few days ago that this particular week is one of the weakest of the years…..
I don’t know who’s right, and I could be wrong…
*often wrong, never in doubt – hahaha* 🙂
I have a set trading seasonal approach. With the exception of Apr, Jun, Sep monthly seasonal pattern I have observed is: week one, up..week two, down first three days, up last two..week three (this week), up all week..second to last trading week, down all week..last trading week, up. Work in progress though, obviously this simple system could benefit from more dialing into to monthly variation but that would make it more complex. Since I use the lunar chord and candlestick technicals in addition to seasonals having a simple and unrefined seasonal guide is what I am satisfied with at this time.
Nice to see all the big banks breaking their weekly uptrends from ’09
and GE breaking to new lows
I suspect GE must be heavily involved with loans/derivatives in oil and gas
I know a GE subsidiary is heavily into sub-prime car loans and there the delinquency is approaching 1Trillion.
Given GE’s propensity to gamble on the tax payers money I would not be surprised to find their fingerprints in oil and gas too.
wow, could biotech finally be breaking, details to follow, film at 11
Stick save needed: http://scharts.co/1AupNC0
Who on the site think this is just another head fake down and we move higher with ECB QE next week?
I wrote this last night. I expect intervention but it may not matter. I attempted humor on this.
http://ibankcoin.com/bluestar/2015/01/14/janet-yellen-i-see-you/
Yes – we see them now – the emperor with no clothes. May their nakeness now shine forth.
We have had 4 Hindenburg Omens now – January 5th, 6th, 12th and 13th, 2015. This is what Central Bankers do to Markets.
I am trying to find a chart for theses Omens but cannot find one for 2015. Do you mind to share your link of these Omens ?
Thks
I keep a chart, but calculate 2 Omens, the normal 2.8% and then a relaxed 2% new highs/lows. Also, I only use stocks for new highs/lows, most people forget and use the entire market including ETFs.
The vertical lines are the HOs. Zoom out I have gone back to 2006. No false signals using my methods.
http://stockcharts.com/h-sc/ui?s=$NYA&p=D&yr=0&mn=4&dy=0&id=p67149720817&a=379612359
From Dr. Robert McHugh’s newsletter – he keeps track of them.
Omens don’t work well at turn of the year, due to the January effect.
Good post, Mae. Your contributions to the board are nice.
next tuesday and wednesday are perigee and new moon with moon rising towards equator from south. i expect rather robust up move in market beginning friday.
on prior charts new moons and perigee are very price supportive.
On the other hand, I just went through my usual charting routine, and I have to say, other than maybe……if you held my feet to the fire and MADE me buy something…Emerging Market ETF’s I can’t find one thing stock-wise I would buy right now… And EM’s are a big if too, at that…..
Short-term – and short-lived – bounces aside, I see lower prices ahead…
No Sun, or Moon, or Seasonal, or Gravitational work involved here, so caveat emptor….. 😉
Gratias ago tibi, emptor.
I held nothing to the fire yesterday, but I bought Pinnacle (PNW) at open, it closed in positive territory. if it closes below the current flag, I will exit, but so far it looks good. I know nothing about the company, I don’t need to know.
I like this volatility, although I don’t like when it happens outside of US session. Yesterday, SP500 test-rejected Jan 6th low, and again now…decidedly, the market doesn’t know what to do, may stocks are just stuck in consolidations.
So close to a collapse, but instead a double bottom in ES. VIX held upper wedge resistance and SPX has a hammer looking candle on the daily. looks like it’s meant to rally into the new moon, speculators buy into the hype ahead of ECB meeting, which coincidental or not, is Jan 22, a day after the new moon/perigee
And Andre has Jan 22nd as a low….
So the only way I keep from going bat-sht crazy ver all this stuff is to just look at charts every night for clues, try to stay (somewhat) aligned with my trend-following system, and cross my fingers…….
Oh, and wait with bated breath for Nicolas’ analysis…. 🙂
Andre is 22 jan high and then bags to 5 febr?
It’s good to see that the Swiss have finally seen the light and ended their ridiculous peg to the Euro. However what I don’t understand is the dampening effect it has had on the US markets this morning. Just wondering if it’s overall nerves or a correlation that I haven’t worked out.
Anyone here got any thoughts please?
I wonder how much of US corp earnings come from Europe…. I reckon sooner or later a weak euro will hit earnings?
Purvez – i see it as incremental evidence that Central Banks don’t know what they are doing
a tipping point will be reached someday – a real POR (Point of Recognigtion) for the masses
I’m not sure I see that – why wouldn’t the simplest explanation be the best one, i.e., Swiss CB knows ECB QE is coming and is taking a preemptive strike to lessen the impact on its currency (making it more costly for others to park their savings in the Franc, thereby mitigating its appreciation).
Good points…
Probably something like being married to someone that you now realize is an idiot, and for self-preservation, you say to yourself, “I just gotta get out of here…”
Would SNB’s action suggest that ECB’s QE will be bigger than expected? Something drastic/desperate on the way?
Gary, yours is the most obvious, sensible explanation…..but do CB’s do ‘obvious’ and ‘sensible’? Maybe the Swiss are different.
What a dangerously interesting perspective Mun Hon! Thanks for highlighting that possibility. Let’s hope it isn’t ’cause that would be an even BIGGER shocker than the SNB’s news, specially as the world and its grandma believe that Draghi is on an ultra short leash.
To be sure, the Swiss authorities action resets the Franc crosses higher. But if QE is coming they obviously didn’t have the wherewithal to keep the Franc/Euro cap where it was, and rather than support it by intervening thereby sustaining severe FX losses as a result, they faced reality. They didn’t want Nicolas in there betting against them, a la Soros.
“i see it as incremental evidence that Central Banks don’t know what they are doing”
LOL – you know, you could just be right there…
Volatility back with a bang to shake out some
of the complacency.
Barry, this currently looks a highly dangerous market to me,
whether on the long or short side.
Your strategy of reaping profits when available is valid imv.
Hi Phil;
You got that right, that”s for sure, sir… *nodding emphatic agreement*
There are old pilots, and there are bold pilots, but there are no……… 😉
And speaking of that, Nicolas, you just got your warning shot last night, c/o the Swiss CB…..
CLEARLY, CB’s have no f-ing idea what they are doing, and are just slinging crap around to see what sticks…. Depend on them at your own peril……
They are NOT there to make sure you, or I, make money in the markets, I assure you…. Good luck, dude….
Meant to add, my trading system has a couple of whipsaws the past two trades, one a sizable one, but yes, keeping on one’s toes has been very helpful….
Have to say, this is starting to become draining though, and avoiding just that is the reason I built my trading EOD trading system in the first place…
So there’s a disconnect somewhere in what I’m doing right now…
I’ve had a really good first two weeks of the year, but 3X ETF’s ~are~ like having a bull by the tail sometimes….. :-O
Always appreciate your thoughts…
Barry
PPI collapsing = eonomic deflation…..wooohooo let’s buy stocks!……..the penny will drop in 5 4 3 2……..?
http://finance.yahoo.com/news/u-producer-prices-post-biggest-133408395.html
No US interest rate rises this year now looks probable.
I perviously posted that there was likely to be one rise
at most, through 2015, even that now looks unlikely.
Phil.the US Fed will never ever raise rates in our lifetimes. That is about the ONLY certainty there is apart from the obvious other two.
BTW you could be 20 yo and I would still stand by that statement.
allan, they will have to raise rates at some point…look at the banks now. they are hurting. the law of diminishing returns has finally hit them. Only thing QE and zirp did was help them with their trading desk gains. Now that is over. We could be japan part 2 but they saw that didn’t do squat, plus the market collapsed forever. So they might just raise it now, help the bank’s balance sheet, survive the crash and maybe start over sooner….who knows though.
555 TRILLION Reasons Why The Fed Won’t Let Rates Normalize
http://www.gold-eagle.com/article/555-trillion-reasons-why-fed-won%E2%80%99t-let-rates-normalize?utm_source=Gold+Eagle+Email+Newsletter&utm_campaign=a117dcb457-RSS_THU&utm_medium=email&utm_term=0_654d25a6f9-a117dcb457-98152541
Allan, looks like your Gold call may be coming good.
Have to admit I thought it may trade lower,
however it’s acting as a nice counter trade with
rapidly increasing volatility in equities, and with
yet more QE ultimately likely in the US.
Mate in all honesty I really don’t think it was that hard a call. When a trade gets so lopsided and sentiment so extreme history tells us that reversal is near.
Watch the USD trade next. That will really propel gold.
Cheers
http://stockcharts.com/def/servlet/SC.pnf?c=$GOLD,P&listNum=
Just a few days ago, everyone and his brother (many on this thread) were smack sure stocks were headed much higher, gold much lower. And yet they both bottomed OVER two months ago! These foolish newbies apparently weren’t around in the Nov 2000 bottom in gold stocks or the Oct 2008 bottom either. There will be the same fools at they next bottom hearts from now! lol
Allan will soon be a hosting an all-expenses paid three day soiree (that’s too nice a word for the debauchery sure to ensue) at his newly acquired island next to Larry Ellison. I’m in!
Do you have to be his mate to attend. Will there be alligator wrestling?
Miners lagging here tho.
Long metal short miners. Watch em get severly burned.
I was sure Allan that you would not dream of shorting the gold miners at this juncture. The first year or so of a new cyclical bull (in a long term secular bull) in the gold sector always sees the miners leading the way. Today a classic example gold +2%, miners +7%.
I’m no trader, just holding gold and miners for the next 2-4 years as this mess unfolds.
Good luck.
The moment of truth finally approaching. If December lows are taken then all hell will break loose as it means major bear has arrived. SPX 1700 would be reasonable target as it is 38.2% retracement of 2011-2014 bull. Gold may target 1500 in the same time.
Interesting. In October, the market spent entire 5 days below August lows…not hell, just limbo.
Lol GM I didn’t mean me!
I haven’t even finished accumulating.
Oh, sorry, yes, I can see that now. I thought it was odd for you to say that.
Just a word on central banks, the topic de jour after the SNB’s move today.
It’s worth remembering that the vast majority of CBers are beholden to the psychopathic politicians, and that the politicians are ultimately driven by the gravy train loving electorate. So I cut them a large amount of slack, as they attempt to navigate through uncharted waters.
I guarantee you that every central banker knows that the world is going down, very hard, and that this time is probably the bursting of the debt bubble for good, including the sovereign debt bubble. The US has had a great run as reserve currency issuer, but all central bankers know the dollar system doesn’t work due to Triffin’s dilemma. Yes, the Fed knows its days are numbered, dissolution lies ahead as politicians look for someone to blame.
Hence, central bankers have been playing the game, buying time, as preparations are made to cope with bank failures, and also to ensure the next reserve currency (the Euro) is ready and waiting when the dollar collapses. It is ready.
Oil (the Saudis) made the decision to move away from the dollar in the 1970s, but have had to bide their time ever since, to allow preparations to be made. Note that the Saudis have taken down the oil price, bringing matters to a head, right now.
An analogy i read recently is that this is going to be akin to changing the engine on an airborne plane, likely to be hairy and bumpy. But the world needs to move away from debt and back to settlement. No prizes for guessing what will be used to settle up in the new world that lies ahead.
Good luck.
GM I was with you ALL THE WAY….until you said the Euro would be the next reserve currency.
Unless you have a single Euroland, with single debt issue, that is probably the MOST ABSURD suggestion I’ve heard. Not meaning to be rude, just aghast.
purvez, if you know what the full plan is, you’ll understand why it’s not absurd.
The plan is that intra-EZ debts will be settled via CBs using official gold reserves.
Also, the ECB is likely to QE into physical gold, driving the price considerably higher and helping break the LBMA paper markets. The world needs a higher gold price, and needs to settle its debts on an ongoing basis. Like a gold standard, but with a floating gold price.
(It’s a huge topic, taking one back to the 30s, but lots of interesting reading material here for those that may be curious..not my blog):
http://anotherfreegoldblog.blogspot.co.uk/
It is a grand plan, let’s hope it works out, for all of our sakes.
Ok GM I’ll keep an open mind and read the blog….but it’s late here in the UK so it will have to be tomorrow.
Thanks for the link.
GM I visited the blog that you mentioned and I …..tried to understand what it was trying to say. However it appears to be a collection of material with ‘gold’ at it’s center but I couldn’t from just reading the first few make out what this ‘grand plan’ is and how it allows the Euro to become the next reserve currency.
Your point about intra-EZ debts being settled using gold reserves is just dealing with the EZ’s own affairs. How does that allow the Euro to become the World’s Reserve Currency?
I think it is the other way around. Central Bankers are beholden to their Globalist Elite. Politicians are arm twisted and bought out by Central Banksters (Globalist Elite) and Wall Street.
The Banksters know that everything is falling apart but try to keep it together to keep the sheeple complacent while they plan their ongoing wars of conquest and control of the sheeple on their way to consolidation of their power via a New World Order through Wars and economic chaos. Through Chaos, they plan to take over.
Debt is one of their instruments of War against nations and people. We are seeing their chess moves in front of us. However, they still cannot control everything (such as the sun and stars) – may their karma return unto them.
Yes, that is the ZH narrative indeed, but if you read, watch and study the BIS/ECB you will quickly see it is nonsense. And when the ECB are failing major banks over the next few years, well, it will be plain as day.
All of a sudden the authorities’ omnipotence is being questioned. Why wasn’t there more coordination? Lagarde wants to know and so do markets.
MarketWatch headline: IMF chief Lagarde surprised she was not contacted by Swiss National Bank head
Lagarde = IMF = USA = old-system (socialist)
SNB = ECB = BIS = new system. (ordo-liberal)
I believe that the Anglo American Globalist axis consists of North America, England, Europe, Japan, Australia and their client states. So I believe that Lagarde, IMF, USA, ECB, BIS, SNB are all in the same club. Though they may not always agree on everything.
The other axis is Russia, China, BRICS, many of the Middle Eastern countries and their client states.
According to long time political analyst Joel Skousen of World Affairs Brief (and he has been very accurate so far) they will plan to get rid of the impossible debt via WWWIII, between these 2 axis powers, where the debt will be wiped out, currencies will be reset, and they can blame it on the war and still manage and plan to be in control.
This is how the devil and the psychopaths who worship him would plan things.
http://cluborlov.blogspot.ch/2014/12/the-imperial-collapse-playbook.html
Gary, i really think this is the crux of the whole matter
2000 everybody knows the internet bubble broke
2007 everybody knows the mortgage bubble broke
i suspect in a few years
2014 everybody knows the central bank omnipotence bubble broke
the swiss national bank just got the party started
especially sweet because they fought so hard against the gold initiative
Specie,
Yup agree.
http://ibankcoin.com/bluestar/2015/01/15/central-bank-omnipotence-is-now-officially-dead/
My two cents … about gold and miners. I think there is enough momentum to continue a run up into about mid-Feb or early 3rd week of Feb to 20th. I would not short miners even if done as a long metal/short stock hedge. The weekly chart indicates it wants to complete a bottoming “W” pattern and that implies GDX low 24’s as a minimum target to gun for in Feb. For remainder of Jan it might bounce between low 20’s to 22 and frustrating both longs and shorts.
There also exists the (remote) potential that it extends to end-Feb/early Mar and if so a GDX target of 26 is possible in that scenario. That would be a dream exit for any longs.
Mercury inferior conjunction on Jan 30-2015 and gold at the very least typically rises up to 10-14 days prior to such date(s). If on a strong upwards trend then it can sometimes extend past that date by an additional 3-4 weeks.
So GDX should not breach much below 20 for any extended period in the next month or so if the run is to continue. If by late next week still holds up in the low 20’s minimum for GDX then miners likely makes a run past the Mercury inferior conjunction date of Jan30.
FWIW I think this is a bear market rally for gold/miners and it will then have another staggering decline afterwards from spring to early summer. As BetaFish mentioned before, this early summer time period would coincide with the start of Venus retrograde cycle and probably a good entry point to pick up beaten up gold stocks at that time for a more extended bullish run.
With the mentioning of the Hindenburg Omen, I would like to add another possible omen which I will dub the “Elvis Omen”.
I have noticed that since Elvis has left the post, the market has tanked. Possibly when he returns it will be a sign that the market will rebound.
Steve T., “TimePriceResearch” has some interesting graphs of Mercury Retros and they show almost always generous times to the market, especially the latter half. Venus Retros are similarly generous though since they last longer harder to trade.
Beta, the upcoming Mercury retro cycle Jan 21-Feb11 is one that will feature a big move. My concern is in which direction (lol)!
I looked at some past cycles and there have been both bullish and bearish cases. Last year the one that occurred in Feb 2014 took place shortly after the market bottomed after a big decline and it rallied quite hard during the retro cycle. However, one also took place in Oct 2014 (Oct 4 – 25) and that had an ugly drop but indeed the midway point marked the bottom.
The price action since Dec29 (and so far) has been overly bearish leading up to the Jan 21 date. That is confusing to me if Jan 21 is supposed to be the start of a nasty decline. But the present chart pattern is also following the action back in Sep 2014 leading up to early Oct 2014 too, and if that is the case, these next few days up to a week could merely be the halfway consolidation point before a sharp significant correction that will could begin late next week with most of the damage occurring in Jan 26-30.
All Mercury Retrogrades (most all) have nice bonus wrapped inside. So if we have continued weakness, I would look for a very strong finish to the Retro that is exaggerated to make up for the losses. Using money management of course, not betting. I have looked at decades of MRs and all have a positive tone except a very few. The current market action could be an inhale before the market sprints higher into the end of the MR. Not to forget we are in the golden glow of Nicholas’ bull market which coincides with the year 5 phenom.
Oh man…. That’s harsh….
I just assumed Elvis got banned, and that’s why he’s not around….
Certainly, these threads would have about twice the comments though… LOL!!
Some good, some “ehhhh”… But some were really good…
Miss the dude… Hope things are okay with him…
Maybe OD’ed on WCCG…. 🙂
Elvis could be visiting his relatives in his Transylvanian homeland.
He’s not banned.
Moon in Scorpio again today and tomorrow. Sting!
VIX is acting real comfortable here. I think it spikes much higher in next couple days. No panic buying follow through from yesterday. I think there are tons of longs trying to figure out how and when to hedge.
And two big thumb’s up to GM today….
Excellent posts a bit ago… Thank you, and well done!!
I hope this market mayhem continues. Would love to see all those mega bullish predictions for 2015 destroyed badly but am always cautious as the FED is on their side. I reckon another pop at 18,000 is due to get all to switch to Bulls before the bigger drop of 10%+
Hard to see that happening with HY ~still~ under it’s October lows…
The pop part, that is….
Bounces along the way, yes….
But 18k Dow? Hard to see it happening from what I watch….
DAX needs to finish its 3rd second chance and tank right about now…
The big news from CHF should be risk off. Puts sellers on CHF might have blown up completely.
To follow John Li here, an interesting article on the topic of the day right here…
Fed transperancy has allowed speculators to front run the markets and drive up asset prices to bubble prices. Now interest rates are at record lows and assets are at record highs. The next logical move is to maximize leverage to short for crazy risk/reward ratios. The fall could be epic.
This time it could be different. The SPY and DJIA are 100 correlated with most peoples retirement planning. If they were to drop, I guess people couldn’t retire as early.
I think a perfect storm has been set up via fed market propping and decreasing demographic trends.
WT you can’t give the Fed’s all the credit. ALL CB’s have contributed. Something desperately has gone wrong today with the Swiss. Their hymn book has gone 180 degrees and it will be interesting to see if any of the other CBers wake up or even better the populaces of the PIIGS.
Well worth reading this writer every day IMO:
http://www.alhambrapartners.com/2015/01/15/forget-the-peg-fight-the-dollar-short/
I think it’s perfectly clear today that Mario is about to back up his word in the next meeting or March meeting. Welcome to the euphoria stage.. this is the final leg up in world equities!
Happy trading boys. Don’t get caught with your shorts down.
Just went through charts tonight, and just not seeing a reason to go long yet….
Still holding shorts….
And I like it when my shorts are going down…. 😉
That’s what he says until his wife walks in discover why he has his hand on his dick next to a pre-teen video
test
This just in. Max low December 16, max low tide December 16. December 17 way up. Max low tide for January was today! Watch out above!
This correlation between max low tide of month and monthly price low is not always so exact but is often useful.
Max low tides correspond exactly with Peggy’s spiral low price dates (by coincidence or correlation is ambiguous).
Today’s latest solar polar field strength readings show that the sun’s northern hemisphere is still not progressing through its reversal into its new polarity (and in fact might even be easing backwards – again). This indicates that SC24 max is not over just yet.
This quadrupolar status (one hemisphere reversed, the other not) has been persisting since mid 2012. There was a remarkably similar period between 1777 and 1779, according to this study of sunspot cycles and field reversal timings: http://www.gpsl.net/climate/data/ssn-1780-anomaly.pdf
At that time (SC3 max) there was nothing obviously unusual about observed sunspot numbers – just the timing of polarity reversals. But there was a very unusual 350% increase in commodity prices, coinciding exactly with the onset of the quadrupolar sun, in a space of only 2/3 years – that was equivalent (in percentage terms) to the total commodity price increase over the 40 years between 1968 and 2008!
Perhaps this indicates the levels of speculation we might see during SC24 max.
Or perhaps it is just a coincidence – I’m sure other more practical reasons have been put forward for that 1777/9 surge.
Long term commodity price chart: http://www.ritholtz.com/blog/wp-content/uploads/2012/04/bla3.png
Thank you. I don’t have any other events for SC3 noted.
This is either an “on-time” inverted crash, where commodity prices rose instead of fell, OR this is a bubble that crash 2+ years late versus solar max.
At the risk of being Captain Obvious here, just going through my charts tonight, and seeing the chart of FXF, the Swiss Franc ETF, for the first time today…
You see the reports and stories of the pop in it, but seeing it on a chart just stops you in your tracks…
For anyone short the Swissy, we salute you…. Whew….
Hi John – How far out is the next solar minimum projected? You mention several years, but is there a more specific time frame? Thanks.
Average 7 years from max to min, so from 2014 roughly 2021.
Does it have to do with a golden ratio (~61.8%) of the entire cycle?
15/1/15, who would have thunk it but perhaps today is the game – changer, the day we start losing faith in central banks after the SNB shocker. the technical picture has changed -. just look at the NDX 100. it needs a magical close above 4100 tomorrow, otherwise we are headed for 3700 to create a gigantic H&S
Stunning if true. From Bronte Capital:
It is time to close Saxo Bank down
Posted: 15 Jan 2015 04:48 PM PST
Saxo Bank is a retail foreign exchange trading bank. The idea of forex trading as a retail product is mildly offensive any way. [I simply can’t see how you can make money doing this in any consistent manner.]
However the (a) lack of systems and (b) depth of the scam is revealed by Saxo’s statement after the giant Swiss Franc move today. To quote:
“Due to today’s exceptional market movement in CHF crosses, we have been filling client orders and positions in an extremely illiquid market. Once we are better able to establish true market liquidity, all executed fills will be revisited, and will be revised and amended to more accurate levels. This may result in a worse execution rate than the originally filled level.”
It is of course garbage of the highest order that in the biggest currency movement of recent times there pertained an “extremely illiquid market”. If Saxo quoted the wrong price the problem is Saxo’s systems. Instead Saxo is just stealing from its clients. It did a deal and they traded at a rate – and they are rewriting that deal to suit them.
Theft is the right word.
Any regulator that lets Saxo Bank do this is failing it core functions. Saxo bank’s licenses should be revoked.
They have had consistent bad reviews and it’s one of most famous bucket shops among traders. One of many reviews :
‘But I tried to trade CFDs, futures and forex with Saxo. And here Saxobank shows its real face: Total scam.
If you set a stop loss, it will be triggered, doesn’t matter how far away the price is. The second time it happened I made a screenshot that proves that the price NEVER reached that level and complained. The support just said: Our indicated prices are not binding and just a rough indication where the price could be….Great broker, isn’t it?’
Yes, the regulators seem not to regulate :
http://forexmagnates.com/saxo-banks-license-is-under-threat-following-a-portuguese-clients-lawsuit/
“Saxo bank’s licenses should be revoked” Be careful what you wish for Gary – I received this email from a UK spreadbetting broker yesterday (who are not associated with Saxo as far as I can find out):
“Dear Mark,
Please be informed that due to today’s exceptional market movement in CHF crosses, we have been filling clients’ orders and positions in an extremely illiquid market.
As such, we are now reviewing all executed fills and we will amend them to more accurate levels. This may result in a worse execution rate than the originally filled level.
Please keep in mind that, therefore, the balance in your account(s) might change and your trading activity be affected”
Sound familiar? Sounds to me like a co-ordinated effort to make retail traders pay for financial industry losses. We’re now seeing the early signs of what will turn out to be widespread bank closures – starting with the minnows.
No such emails to me form 2 spreadbetting UK based brokers (although I had no positions in CHF)
Mark, did you lose money on this? It is an outrage!
I haven’t placed any trades with them (ETX Capital) for several years, so am not affected. But the same wording being used by two seemingly unconnected firms shows that there must be some degree of centralised effort to make sure that industry insiders are not left with any losses.
So if this is what happens when a currency suddenly slumps, what will happen to gold investors who use bets (or indeed leave their gold in the custody of industry insiders), when they get the surge or reset in gold prices they’ve been waiting for?
Gary, I suspect that somewhere in their ‘small print’ it says that they are allowed to do this during ‘exceptional market conditions or some such’.
I think it’s referred to as a MAC clause, i.e., a material adverse change or some such thing.
http://www.bloomberg.com/news/2015-01-15/yellen-leaves-greenspan-put-behind-as-she-charts-rate-increase.html
I think I can hear Nicolas moaning, “Nooooooooooooooooooooooooo” all the way over here…. hahaha
“Turn those machines back on!!”
“Get those brokers back in here!!”
Barry, I suspect Nicolas may yet have a short lived last laugh.
I think the Swiss just pushed the ECB into a corner where they now have to put up or shut up. Merkel will not back off and that is the boost that Draghi needs and gets by having the Germans finally back him on Euro QE.
Only when the populaces of Europe & US see that the effect on the Swiss was nothing like they have been told will happen with deflation that the game will be over.
I think Gianna above is right. Also some others who have been suggesting a blow off phase!!
Tight leashes on either side of a trade are definitely necessary.
Today may be a short term rip your face off rally, especially as DAX is targeting new ATH. Buy the ECB rumors rally and selloff after the announcement is made… this is quite probable scenario
“the swiss national bank just got the party started”
Yep!……just the first salvo. Wait and see what happens when the first repercussions begin.
Don’t forget Greek elections next week……that will be the second salvo and further repercussions……
The losses will continue to mount from there…………a word not heard for some time will be the buzz once again….
CONTAGION!
Remember it’s the punch you don’t see coming that can do the most damage…and the SNB just landed one fair and square on the chin. This has not even begun to play out.
I think the SNB may have acted with the knowledge of the other CB’s. Take one for the team as it were…..
J
js, mate I doubt that. It appears that the IMF had zero knowledge. If CB’s were informed so too would the IMF have been informed because that is just how it works.
It would surprise me to see some fallout within the SNB over the next few months for such a rogue move.
“it would NOT surprise me to see some fallout”
Allan, there are two competing forces, the SNB and ECB are working hand in glove, the Saudis too, away from the USD:
Lagarde = IMF = USA = old-(dying) system (socialist/big govt/debts)
SNB = ECB = BIS = new system. (ordo-liberal)
“zero knowledge” and “you don’t see [it] coming”
Yes indeed, those were the very essence of this crash – and every crash.
That’s why it cannot happen in the stock markets now – not while there remains widespread talk of a crash, and a widely published “crash setup”.
Mark, I don’t see much talk of a crash. Certainly bearish rhetoric is on the increase but come on buddy, the bearishness is nothing compared to the bullish rhetoric of new all-time highs in 2015.
The SNB move has already taken two scalps, admittedly minows, but that’s just the beginning.
I stand by what I said, this hasn’t even begun to play out.
I actually agree with the vast majority of what you say Allan, its just the timing of when all these negative stock market indicators and divergences catch up where my opinion is very different (and what happens in the meantime of course).
I take your point about current bullish rhetoric from mainstream analysts; mostly calling for continued strong steady gains I think – they’re doing their usual thing of simply extrapolating 2014 into 2015. So no doubt they’ll be wrong as usual, and movements will be more extreme than they forecast.
But as far as sentiment goes, I remember back near the approach to 2000 when the Sunday papers usually came with a “best 10 ways to invest in the stock markets” special feature. There were TV programmes about “ordinary” people who had given up their careers because stock investing was a one-way road to riches. Others regularly met for coffee mornings where they brought along their calculators and added up how much richer they were than the day before!
You and I both have experience of similar mania in the property markets in Australia and UK.
But I don’t see anything like that now. In fact, I personally am not familiar with a single person who has any interest in stock markets – never mind having bought a share or two – never mind being “fully invested”.
Well, to me it’s always been about the leverage in the system. Because it can come down to not whether you want to sell but whether you have to sell. And while people can say everyone is leveraged to the hilt, how do then really know? Perhaps the credit/FX markets are our canary because If those instruments are the securities most likely to be levered up, then shouldn’t we see any force unwindings occur there first, and not in equity markets? And are we seeing that? So far (and I recognize it’s early) it’s only been the two-bit players who have been carried out.
Swiss franc is the second big funding currency for the carry trade next to the yen. What we see is the beginning of a trend reversal in both.
http://www.thestreet.com/story/13013582/1/why-is-doug-kass-still-buying-gold-now-here-are-seven-good-reasons.html
HI Allan
It “appears”….ok then. I bow to your superior inside knowledge…..lol:)
Lows have been rejected, Dax soaring….
US markets have disconnected from EU. Somethings brewing.
WT, people trying to front run the ECB QE may be one reason?
I don’t see permanent separation a possibility due to QE at DAX highs. I think the cb’s lose control imminently.
No not suggesting a permanent disconnect. Just that the Dax is receiving more attention currently in anticipation of Euro QE.
Hi all ! I am not worried at all. IBB is still near the highs. This is only a very short term correction and a sucker’s rally in gold. I suggest you all add to your gold shorts. Wait until you see the ECB QE, I expect a truly impressive amount and markets will rally big.
So far, Nicolas, you have been right to be bullish. Markets still appear under the spell of QE (witness Europe) so your “don’t fight the Fed” strategy is right…until it isn’t.
Nicolas you were short GDX from just above $17, you must be feeling some pain?
Anybody finding the weakness in the Trannies odd?
Gary I assume you are referring to the weakness in crude and its no impact on transports?
Yes, exactly. Transports should be leading the pack here, and they’re not.
Yes Gary. At the end of the day cheaper oil saves on costs but if your deliveries are facing declines that outweigh the lower costs then of course that means lower profits.
DOW Theory still has a place.
Lunar Chord:
Perigee in 5 days.
New Moon in 5 days.
Declination passing South tomorrow (14 days of weakness over)
Seasonals:
Next week should be down all week(second to last trade week of mo).
Price:
Lacks direction, downward bias.
Inner Planets:
Mercury approaching retrograde (more vol next month with up bias)
Venus has left opposition which was supportive now drifting to next retrograde.
Summary of My Positions:
Cash. While Lunar Chord is setting up for phenom. week next week. Seasonals and price action are negatives, as is possible headwinds from Mercury not quite yet in full retrograde. So, I will be trading on technicals only which is made up of a simple candlestick red/green candle technique. Green candle above red candle open buy, red candle below green candle close sell.
“Wait until you see the ECB QE, I expect a truly impressive amount and markets will rally big.”
Right, that’s the reason why the smart money indicator on the DAX -daily- is plummeting big time, in a stair stap fashion, only more agressive before the 10% correction in july last year. For more info on the s-m-indicator: http://www.technicalanalysissite.com/indicators/smart_money_flow_index1.htm.
Anybody convinced this rally is anything more than a DCB take a lookie see at this
http://stockcharts.com/h-sc/ui?s=AAPL&p=D&b=5&g=0&id=p01670049092
And this
http://stockcharts.com/h-sc/ui?s=TVIX&p=D&b=5&g=0&id=p60807512898
Thanks everyone. New post is out.