Bulls still have the ball at the moment, but we remain neither confirmed in bear nor bull market so need to keep teasing out the clues.
One that got some coverage this week: two all time record high prints in the Skew (protection against an outsized move). The 8DMA of the Skew shows reasonable odds that turns out to be a top in stocks on a longer term view.
Source: @sevensentinels
Next we see the long sagging breadth in the SP500 is similar to 2007-8. From the recent low in breadth a bear market rally is in keeping but ought to fail by the 200MA, shown circled in both instances, if this is indeed a bear.
Source: Stockcharts
Credit spreads are a negative divergence. Like breadth they have fallen some way and some time already.
Ditto oil. So take your pick: either all these things have washed out and yet stocks have held up bullishly, or, like in 2007-8, markets have rolled over gradually (back then: real estate, developed stocks, emerging stocks, and lastly commodities) with developed equities now the last this time to complete the bear.
Support for that latter option comes from various other stock market indicators which diverged pre peak in both cases and remain in downtrends:
The big picture shows similarities to the 2000 peak also, in terms of IPOs, leverage, risk and M&A. If this isn’t a third major market peak, then we need to explain away these:
Turning to the US economy, services are generally doing fine, whilst manufacturing is at recession levels. Various overall indicators, net of oil and dollar, are doing fine, but again the question is whether oil and dollar are flagging creeping disease or whether they are more isolated troubles.
Here we see how overall US economic indicators are weaker than at previous tightening cycle commencements, perhaps providing the justification for staying at ZIRP, but either way telling the story of a very delicate economy.
Source: Shane Obata
World trade is negative and central banks have notably recently been having to draw on reserves, something we haven’t seen since the last recession.
Source: Economist
Economic surprises are overall increasingly negative around the world.
Source: Thomson Reuters
Has the world entered an unstoppable cycle of negative feedback looping? That’s what I see is happening and it befits the period post solar maximum. But it comes back to the stock market: equities typically lead the economy and for much of 2014 and 2015 the levitating market prevented the weak economy from tipping over the edge, due to the wealth effect. The 10% drop in stocks in August was therefore a major blow, but, having partially retraced, what’s happens next is key.
Here we can see that other major stock markets are in a more bearish position than US stocks.
And here we see that US small caps and mania-leader Biotech are under-performing large caps, whilst gold has notably taken off (and rallied despite a pullback in oil this week).
This all adds weight to the likelihood of this being a bear market rally, with US large caps the last area of strength to break decisively.
My positions are the same. I am looking for stocks to arch over again this week or by 200MA / November at the highest / latest. However, even if this were to ultimately resume bullishly, this kind of technical price pattern historically has seen a pullback in prices from here to create a third but higher low. So if stocks do start to fall back again it still won’t be true bearish confirmation and both bullish and bearish alternatives will likely remain in play for a while longer yet. Thus, I will rather look to leading action from the likes of gold (ideally continued strength) and Biotech (ideally breaks downwards again to reveal recent stabilisation as a bear flag), plus some leading economic indicators and credit. And then there’s earnings. Earnings got properly underway last week but plenty more big ones to come over the next couple of weeks. Thus far the earnings growth is a blended -4.6% and the revenue growth a blended -3.2% from a year ago. Given US equities are still highly overvalued historically it’s going to take some big beats for this not to weigh negative on the market.
S O L A R C Y C L E S 
Reblogged this on Rajveer on Markets and commented:
A must read as always
Thanks
We read a lot about skew index. I think Its misleading indicator. If you check Oct 1998 daily chart of SKEW index (SP500 had decline in almost similar fashion then) with SP500 daily chart for same period you would notice SKEW gave false signal with reading of 146 on Oct 16, 1998.
But, I personally expect SP500 to re-test Aug 2015 low in near future.
Caldaro thinks this is the 5th Primary of Super Cycle 1. We could be weeks from the top. Even though I cannot agree short term, I do expect the 5th to fail. The bear of Super Cycle 2 is knocking. Caldaro thinks that will deliver about 45% or so correction and be around 2 years. Then a 30 or so year Super Cycle 3. Trouble is he’s been hard to believe in the past whist being about the one that was right.
https://caldaro.wordpress.com/2015/10/17/weekend-update-522/
My count is the same as Caldaro’s. I called the top of primary wave [3] over a month before he did. I use a number of charts to assist in my swing changes. I’ve posted my cycle chart here several times where I predicted in advance a rapid sell off for primary wave [4]. Here it is again. https://alphahorn.files.wordpress.com/2015/10/spx-weekly2.png
And here is my NYSI weekly chart, which is quite accurate predicting swing changes. It’s pretty definitive that a significant bottom formed. One needs to be objective when trading. Keep an open and don’t search for others that provide the enabler role to keep you in a bad trade. Cheers. https://alphahorn.files.wordpress.com/2015/10/nysi-weekly1.png
Yes SC3. The possibilities are extensive with something like 2000 – 2003 also there. The bigger the wave the longer until the confirmation. The assumptions get bigger too. e.g. that the form of the future will be a replication of history.
So your nysi chart confirms we are topping here…
I can confirm your count via std EW 12 (1) (2) (I) (ii) (iii) (iv) V) (3) 2019.26 (4) 1820.66 (5) 3 2093.55 4 1980.80 5 2134.72 5 waves done. Alternative count correlates with your count 3 3093.55 a irreg b c 1867.01 4 and we are in process of a new high.
If one uses a monthly MACD the sell signal is very clear and it is very unlikely that it will reverse and make new highs.
At 2038.84 a 5 wave count was completed which completes a 335 from 1867.01 wave 4 and a test of lows and lower should be impending. Or if a bull considers 1867.01 as completion of ABC wave 4 then the move to 2038.84 is w(I) of 5 for a new high.
The test is if SPX current strength breaks through 2052.09 that would confirm the bull count.
It is the 1993ish SPX high on 8/28 that tipped the markets hand. That was a 3 legger up. So we know it is part of a wave 4 or wave B. As long as the 5 wave leg down to 1892ish on 9/29 is a C wave, and not a 5th wave failure, we know this move up to this level ( and possibly a bit higher) is correctional. And it will most assuredly fail. The challenge here is not calculating what will happen next, but rather finding a good entry spot whereas risk can be controlled.
If God assured me the 5 legger down to 1872 spx was indeed a c wave of a bigger B, I would bet the farm this pattern would fail. It is a textbook death pattern. Over 90% of such patterns will fail. The fly in the ointment is the possibility that the wave 4 finished at the 2021 high and was followed by a 5th wave failure down. That would make this 5 legger up extremely bullish. Not just bullish, but extremely bullish because of the 5th wave failure.
When we look at everything John has brought to the table we see that is not a high percentage possibility however. If we use John’s work and astro work together we can pretty much eliminate the bullish scenario. Or at least reduce to very low odds.
We must keep an eye on that possibility, but trade the most obvious. And the most obvious is that this is a death pattern.
My greatest fear right now is that this continues to creep higher until it hits the F.M next Tues. and the FM slaps it down like a red headed step child. I am not accustomed to taking that kind of heat. One day of heat is about all my tummy can handle. I have been in this business too long to feel bullet proof.
If this last 5th wave is unfolding as a time crunching dia. tri. ( which is possible), it may test our gut for several more days to come. But test my gut as it will, the odds remain near 90% that this will end with lows well below 1867 spx. Based on all the info we have in front of us, there is a 90% chance this is a true death pattern.
My only question is, ” how many times will it take out my probes before it rewards me”? And, when will the establishment step in and steal our trading capitol? That is my bigger concern of the two. I know very few of you are concerned of gov. theft, but that is only because the banker’s network media does such a good job of concealing it.
“If the masses understood our monetary system and who was behind it, they would revolt by morning”. Henry Ford I may not have quoted him word for word but close enough.
2037.97 completed 5 waves from 1871.91 that has 2 connotations:
1. Bearish as it completes the ABC from 1867.01 for wave 4 and we are headed to new lows. OR
2. at 1867.01 that was an abc correction from hihs 2132.82 and a bull count of 1 a irregular b c to 1871.81 for 2. The move to 2037.97 would be wave (I) of 3
Thus we are seeing currently is a correction from the 5 wave move to 2037.97 and how deep the correction will tells us whether the bull or bear case has merit.
The monthly MACD of SPX tells me we are in a bear market and not likely to make a new high as bullish count implies.
All very compelling John, but there is one very bullish force in the background: there is hardly any alternative for stocks to make some money.
You will find that when investors become risk averse, they are not interested in making money, rather in holding on to what they have already.
So, you will find the UST market (and gilts and JGBs, maybe bunds) will go super bubble in the period down to the solar minimum, also gold will be well bid.
I’m still feeling a downdraft lies ahead here, overhead selling resistance must be huge about these levels, longs trapped for a few months. I am torn between whether we will see new lows, or just a mini-correction. Will have to play it by ear
I noticed the USD perking up on Friday, I know Allan has written it off, but I suspect it has more legs, and perhaps therefore one final low for gold lies ahead, and perhaps its miners too.
I am looking forward to playing a no limits poker tournament tonight on foreign soil. Plenty of French tourists around, playing fast and loose, me, tight as a rock, after a few obvious loose hands.
Good luck everyone.
American manufacturing starting to recover:
http://finance.yahoo.com/news/american-manufacturing-trouble-red-flag-110700169.html
Armaments & Munitions? Is oil so important still?
We can frack we can frack
And do it til u can’t stand still HA!
Exactly who are we manufacturing for??? Who will buy the products??? I think this is more hopeful wishing. I am watching to see how this Christmas sales season goes, I am of the feeling we are on a negative spending trend. Time will tell.
PALS and SPX this week:
Phase: very negative all week
Distance: very positive all week
Declination: very positive all week
Seasonals: weak Tues, Weds
Planets: very negative all week (except lingering VIC effect)
Summary: fully short into Monday’s open, will switch to cash if 1 to 2 percent realized. May look to buy weakness as late October rarely has sell offs due to wealth effect and holiday shopping.
Gold failing at it’s 200 day simple moving average points towards stocks going higher…..much higher.
Is the Australian and Canadian Dollars breaking above their 100 day sma’s an early sign that the Bear market in Commodities is over? If a Bull market in Commodities (except for Gold of course) is beginning will that be optimist or pessimist for Stocks?
Anybody know what Iron Ore and the Baltic Dry Index are doing?
Anybody know how many coffees Richard has had this morning?
No
I have had no coffee this morning. Instead, I have been doing my “due diligence”:
http://www.agrimoney.com/news/australia-ukraine-give-double-dent-to-world-grain-harvest-hopes–8911.html
Hold on to your Corn the basis (cash) is rising:
http://www.agweb.com/article/keep-that-corn-basis-is-rising-NAA-tanner-ehmke/
Now wouldn’t that be something to see both the Baltic Dry Index –and– American Corn start up in Elliot major 3rd waves. So much for Gold and Silver as they break down hard from their 200 day sma’s.
This is a nice top of the wedge position on the NASDAQ (1day chart):
Corrective form to there.
We can reference a 1000 different indicators,
those aside this is a key week being so earnings heavy,
the picture should be clearer by Friday.
JH, Thanks for the IPO and M&A indicators. My gut was both of them were running high, which is a red flag for me. My experience is that in the final stages of an up cycle M&A is used to combine balance sheets and obfuscate the real accounting numbers. Within legal limits of course. The result is that companies fight to hide the true decline in business activity and my feeling now is that when you see companies saying we made our earnings, but our revenue is shrinking, the gig is up. If it were aa few outside companies, it may not be a big deal, but every company is following this trend. If somehow we squeak through this earnings season without too much damage, the M&A accounting manipulation will start fading and companies will eventually be forced to show the reality in coming earnings that business is shrinking adding fuel to the Bear. I still find it hard to beleive that we will make it through this earnings season without damage to the indexes. I am a seller of more of my core holdings if this keeps rising.
Agree
Perter, interesting post re Caldaro’s views.
From a fundamental perspective some weaker
earnings are now the main headway in getting
back to those levels – can’t be ruled out.
If you tell me where my comment went amiss then I will know you got a grip there.
There’s a bloke that I follow (paid subscription…because he does this for a living) who has been following the VIX. Apparently the Oct’15 calls which expire Wed are worth $1.50 BUT the Oct’15 puts are worth $0.10.
Make your own conclusions.
BTW I’ve been reading up on the posts since I got back to Blightey and they are are ‘illuminating’. Starting with our host John H’s. Thanks very much John H.
Right this moment I don’t have the coherence or muster to make a call. But just wait for 24 hours for the effects of travel to wear off and then I’ll be able to make some ‘amazing’ (ly ridiculous) calls as usual.
Good to be back
Purvez
I conclude that followers should not try to be leaders unless they are recruiting for their master
Peter_, very politely….please go away. Thx
Peter_, hopefully nothing ‘cryptic’ in my message above?
It is my own conclusion as you asked non? No free speech what
Adieu, Bonne journée, À plus tard, Salut!, Ciao!
And the fountain of all knowledge accept you in its bosom
🙂 Very good …. but not good enough for me. Adieu.
I am “dip buying” the major grains.
Thanks for sharing your work. Well done.
From a pattern, or chart perspective we should expect another big top ( and reversal) this week ( c:4 or c:B), followed by a move down to the 1830ish SPX area ( provided this rally is a wave 4), or a move down of somewhere near 267 SPX points ( or more) if this rally is the c:B and the C wave down is equal to the A wave down.
What makes the pattern bearish is the corrective nature of the rally from the 8/24ish low. Some might see it as a bullish 1,2,3 up, but at this point it fits better as an abc up from the Aug. low. This long drawn out rally appears corrective in nature. A correction from a low such as we saw in Aug. would suggest a wave 4 at work or a “B” wave at work.
If Pastor Williams ( retired employee of the owners of the Federal Reserve Bank) is right, the US is about to get hit with news of devaluation of the dollar. Currency reset. He says the devaluation will come in increments starting this fall & winter ( possibly starting as early as Oct. 20). If that happens ( and we have to be a bit skeptical until it does), it would be extremely bearish for the US markets.
The USD is not backed by a commodity such as gold ( its considered fiat money). Since the USD has no real value, it would be easy for the USD to loose it’s standing as world reserve currency as well.
Let us pray?
I’ll have a pint of whatever Peter_ is on please.
And just a half of what Richard is on.
😉
The result would be a phsychedelic upper.
Awomen
Interesting comment. Devalued compared to what? If the USD is what everybody devalues to their currency to, how does the US devalue? If this were to happen, would it set off a wave of devalue across all other dollar based currency? In short, I see this statement as the creation of chaos. But I wouldn’t be surprised. The world is in a twisted state right now and this will have to be unwound eventually. The question is how? I tend to believe the markets will correct it over time, but a action to devalue by the US???? intriguing thought. It wouldn’t surprise me, but I still do not believe it.
It must sound crazy if you are hearing this for the first time. The first I heard of it was from John F. Kennedy in the 1960’s. In his speeches he talks of a secret society that wants to make all American’s their slaves. (John was the president of the US at the time.) In an effort to dismantle these people he made arrangements to abolish their ability to create the US dollar. He was killed soon afterwords ( as was everyone else involved with trying to abolish the Fed.).
This secret society Mr. Kennedy spoke of was the owners of the Federal Reserve bank. There were others in the secret society, but it was the bankers that seem to be the greatest threat. These people own our network media and censor all we see.
It is hard to believe any group could have this much power, but they do. Mr. Kennedy saw them as a major US threat in the 60’s and some know them to be an even greater threat today.
Now that you know who some of them are, I will tell you what they have planned. As hard as it is to believe, they plan to re-write the US Constitution and become the new leaders of the world. (Again, if you are hearing this for the first time, your immediate thought will be hogwash. Understandable.)
This fall they ( they ~ often called the elite bankers), plan to start with currency reset ( they estimate this one step will create 30% in inflation). Step #2, Sometime this winter they plan to offer an alternate world reserve currency backed by gold ( probably China but that info seems to remain their secret). This will send the US economy into a spiral that is unrecoverable. #3. Just when we need our retirement funds the most, they will go into our retirement funds and steal some portion. They will say it is necessary because they can no longer sell bonds and T bills. This is a deliberate and well planned attack on US citizens, but few will understand it or believe it as such. The media will convince the masses that it just happen by chance.
When the masses grow hungry they will protest, giving Obama the justification he seeks to declare martial law. He will use his unharnessed power to take our food, livestock, and even the food of our pets, saying it will be nationalized. When in reality, they need to take our food, the food from farmers, and livestock from ranchers so that it CAN”T be used to help the hungry. Hunger is going to be their key weapon. I was told this about 6 months ago. From there on the bankers expect blood in the streets… literally. They believe they will be able to dupe our military into violating our constitutional rights, at least in the beginning. In about two years, they plan to close down every bank ( derivatives will be the explanation for that step.). All deposits and the valuables in a safe deposit boxs will be lost. ( FDIC only has enough money to cover 1% of the US deposits). In order to convince US citizens to accept a new constitution ( one that makes the bankers our kings), they must drive us to starvation and bring us down to the level of a 3rd world country. This is their plan as I have been told. I have been told this by several of their employees, who also gave me a list of things to do to avoid the brunt of the future hardships. Should all of this take place.
I don’t know if they will be successful in their attack on US citizens, and I can’t be sure the first announcement will start on Oct. 20-21, 2015, ( actually their attack has already started), but I do believe they will go through with it in a timely manner and give it 100% of their attention.
There are a lot of people these elite bankers have shared their plans with. If you go to utube and look up Aaron Russo you will see one who tried to warn NY of the 911 attack months in advance. If you look up Pastor Lindsay Williams you will see another who is trying to warn the citizens now. There are others. They believe the elite because they tend to tell the truth. They live a secret life. They are seldom heard from. Some say they are the epitome of evil. But when they say something it is usually truthful.
If you wake up in the morning ( or in the next month or so) and see world wide currency reset plastered all over the news, you will know they told the truth. And if that part is true, maybe all their plans are true.
Well, what is the “endgame” in this scenario? A few people living boring lives with everyone else dead? Doesn’t seem to make sense to me…..
The end game for the elite is a one world government. If you can visualize what life was like when there were kings and servants. The kings owned ALL the land and the servants worked it for the kings. The kings held the power of life and death over the servants. That is what they are looking for. They are the kings, we are the servants.
About a 6 months ago they told a few people the Pope was coming to America ( Sept. 23 to Sept. 25) and encourage 1.2 billion Catholics to go along with Agenda 21 sustainable development, and the one world economy. Which is a one world government. I always find it difficult to believe them but on Sept. 23 the Pope was here and his speech was almost identical to what they said it would be. I continue to be shocked at their precision.
Their world will be very boring and even difficult for the servants, but, they plan on living like a King. Agenda 21 pretty much lays it out. We loose all our land, all meat is taken from our diet, we will no longer get electricity or gas for heating and cooling. Not in our home or our work place. We will be held captive the our assigned city. Perhaps 95% of America will be no man’s land. Meaning, we will not be allowed to live on it. Only those who are put in work brigades will be allowed to leave the assigned cities to work. Image a giant prison with no utilities…that is Agenda 21.
Well Golden, I have to say, this is not the first time I have heard it and I still find it hard to believe. There is a guy where I work that tries endlessly to get people to join some VERY expensive club that has all this inside information flow. He talks very much the same way you do. I will take my chances that this will not happen they way you describe.
Remember, The end of the world is always a few years away, until it is tomorrow. `,~>
JFK was talking about communism and is clear about that.
Any other interpretation is nonsense.
Communism is not secret. And communism didn’t kill him and all others who opposed the central bankers. When a group owns the printing press for a powerful country, they will not give it up without a fight. Kennedy and others who tried to abolish the Fed were shot or poisoned.
Lincoln tried to create the green back dollar in opposition to the bankers. The bankers threatened him, then he was shot. His green back dollar drifted away with him.
If you could literally print all the money you wanted and buy anything you wanted, including network media, and do it all without having to answer to anyone ( Nobody to even audit your money printing books), what lengths would you take to protect that situation? If everyone in the US handed you approx. 25% of their earnings every year and you did nothing to earn this 2 trillion dollars per year except print them a little money from your golden money printer, how far would you go to protect that situation? To what lengths would you go to keep those people ignorant of the fact that they are indeed your slaves for approx. 3 months every year. Benjamin Franklin said there were many reasons for the American revolution, but the primary reason was the bankers of Britain. America was forced into debt slavery because of the interest ( slavery tax or income tax) on the money they were being forced to use. The revolution eliminated that interest debt and freed the American people ( most of them that is). Then in 1910, this secret society went back to work creating a plan that would once again enslave the American people.
These people met on Jekyll Island under extremely secretive conditions. They had to. Everyone in those days knew who they were and recognized them for what they were. Within about two weeks they had come up with a plan that would allow them to steal money from every American citizen. This plan had a few flaws however. It was in direct conflict with the US constitution. So they knew they would need a president in their pocket to pull it off. And they would need to keep many future presidents in their pocket to continue the theft. What was their plan? To create an income tax that would be collected and stored as a payment to them for printing the county’s money. Their first corrupted politician would be Woodrow Wilson.
Us constitution says specifically that only Congress can print money and that no American would pay a tax on their labor. Many people lost their lives in the American Revolution to create those laws for us. According to Ben Franklin, those were the two biggest reasons for the American Revolution, and in 1913, the American people along with Woodrow Wilson ( employee of Rothschild, Rockefeller, Warburg, and JP Morgan) brought the slavery tax back to America, in complete violation of the constitution. All of those lives that were lost abolishing that slavery debt were instantly negated.
By the 1970’s these bankers didn’t even have to back the Federal Reserve note by any commodity. Thus fiat money printed from thin air. Look on the bills in your pocket andyou will see the money you have is Federal Reserve money. Not American money. It is made by the owners of the Federal Reserve bank, who are independent from our country. They are not part of our government, most aren’t even American. But, they use our government like its theirs ( and it is) to enforce their slavery tax upon us. For approx. 3 months out of every year you get up and go to work and give all of that money earned to your masters, the owners of the Federal Reserve bank. And you don’t even know their names because our government/their government has made it a crime to reveal their names.
When a government makes it a crime to reveal the names of a secret society, that makes that society pretty dam secret. These are the people Kennedy spoke of and these are the people he was about to abolish with his new “American” made money. Money with no interest of slavery tax attached. And these are the people who had the most to gain from his death. This is not theory. This is American history. But few know of this because this secret society ( with all the money in the world) own the network media and censor what the masses see and hear every day.
You don’t think they censor what you see and hear? They feed their info to you ( through their media) like a mother feeds baby food to a child. I was at an even 18 months ago ( and there are many other than this one), whereas maybe 1000 Americans took up arms and held maybe 350 federal agents at bay for the attempted theft of 80 square miles of private and state owned land. If a single passing car would have backfired, hundreds on both side would have laid dead in seconds. Headlines should have read ” thousands take up arms to prevent government theft of private and state owned land”. It should have been the biggest news since Pearl Harbor. It should have been plastered on the front page of every newspaper. But it was barely even mentioned by the bankers media ( and that 3 second mention was slanted) because it was the bankers who was behind the attempted theft. Still think you are not spoon fed the info they want you to hear?
We are all their little slaves for 3 months of the year and they spoon feed us what they what us to believe. The only thing that stands between us and them right now is a hand full of brave men called the militia. The militia is their main threat, and the establishment is doing all they can to disarm them. If the militia loose their arms or if they are abolished, the constitution will completely collapse and you and your descendants will become slaves to the Rothschild’s, Rockefeller’s, and Morgan’s for 12 months of the year.
Who revealed the ” event ” that lead to the deaths of thousands of Americans on Sept. 11, eleven months in advance? It wasn’t terrorist hiding in caves. According to Hollywood Producer Aaron Russo, it was Nick Rockefeller, one of our Federal Reserve Bankers. One of our masters.
If there is a glitch in the bankers timing, you can thank the militia.
Well golden nugget
I guess you come from Atlantic City.
i must have missed your point
What has all this conspiracy theory got to do with the present topping process?
Are we at the end of the line or is this just a weak period in a bull market.
Kind regards
bobc
Somebody said Kennedy’s secret society was communism. Just explaining that it wasn’t.
SP is still in a death pattern. It still needs a drifty correction ( getting it now) and one more impulse leg up to be complete. I probed short in the muddy complex 4 because it “could” have been morphing into a dia. tri. Can see now it was a muddy complex wave 4. From last night lows, we need one more completed 5 up. Already saw 1,2,3 up (of that 5) completed at 2048.75ES. Not much left now….but there is still another up leg needed.
If the market does anything other than a 4 down and a 5 up, then I may change my “plan” to probe short, but right now all is as it should be.
Thanks. I am familiar with the Illuminati and the Bilderbergers. They are still in control. The only question is how all of this have to do with a continued phony bull market or another bubble about to be burst?
Sorry, was just trying to answer their question. I wish more were like you.
I am now under water with my remaining puts. This is what happens when we probe to early. I hate it.
I just looked at the charts again. This pattern is rapidly maturing. Our wave 1 was Fib. 55 points. If this wave 5 is 55 points it would stop at 1946-47SPX. There is nothing that says w1 will be equal to w5, but in most cases they are similar in size. This measurement alone suggest the wave 5 ( and the complete upward pattern) is reaching maturity.
When we count the waves, we readily see the choppy sideways motion ( that could have been a die tri 5th wave or a complex wave 4) now appears more like a complex wave 4, abcxabcxabc. If that is the case, we still have the final little wave 5 ( v:5 ) ahead of us.
My puts are March, and I did sell a few more near the low last night. The sell off was a 3 legger which suggested another 5 legger up was possible and likely. It looks more and more like the FM has snared the S&P andwi ll not release it until it has also reached maturity next Monday/Tues.
Chap. Commodity analyst had a projection to 2065. He gave up on it yesterday but send me a note this morning saying it still may happen, and if it does, it will likely be a swift blow off affair that will end with a violent reversal.
My remaining March puts should be able to weather a storm of another few days, but I sure don’t like it.
I heard people will be turned into pillars of salt and she-bears will attack little children and rip them to pieces for call prophets “old baldy”.
Yeh, its in the Bible so it must be true.
as much as i am a bear at current levels, a google search reveals Pastor Williams has had the dollar devaluation position for several years….sky is falling. eventually will be right but so is a broken clock.
Actually he gave the date as Oct. 20, 2015. I was lead to believe it was coming fall and winter of 2015. Back in the 1980’s I was given Oct. 21, 2015 as their “target” date. Will history prove it to be accurate? Who knows. But we won’t have long to wait at this point. Fall/winter is upon us.
I understand we will be forced to eat jelly beans and ice-cream every meal and made to read Goldilocks every morning while standing on our heads.
If I was you I’d give trading a miss and find a simpler occupation like street sweeping.
Or perhaps you can re-write the constitution yourself. Surely if a handful of people can do so, why not just you.
the pattern continues to look correctional from the Aug. lows and it appears to be maturing. It still needs to finish the final v:5 of c:B ( “maybe” it will stretch another 15 points higher if there is no neg. news,) but it can end as a failure at any time. After that we should see this 3 legger up give way to a rather large down leg.
John’s work is in line with what the pattern suggest. The next “big” move should be down. Probing short when we see weakness or see the completion of this last 5 legger up ( that could be truncated) should be a good idea. The alternate count would be the SP is entering a wave 3 up right now, but the odds don’t favor that pattern at this time.
I see from your jelly beans you are confident in your security within the US. That is great, but as traders, we should always try to see both sides and have a protection plan for the alternate possibility. An overconfident approach either way could be costly. And, taking security for granted could be a lethal mistake. I was recently asked to help stop a theft in America. I stood my ground along side many others with rifle in hand while the local sheriff department fled. A dozen sniper rifles were trained on my head while mine was trained on theirs. Fortunately the thugs left their loot and moved on without a shot being exchanged. The same thugs continue to loot today and your home “could” be next on their list. If you think a 911 call will be answered against these thugs, think again.
As you pointed out, the bankers are few in number ( but so was Stalin and Adolf Hitler). The bankers are smart. They currently impose an illegal 20% to 25% tax on each of us every year of our life. That is 2 trillion a year we pay these mobsters and they give us nothing in return, except the privilege of using their worthless fiat currency. Congressman Ron Paul calls the elite bankers evil monsters that will eventually bring the US to its knees. The bankers themselves say it will happen sooner rather than later. Don’t be overconfident of anything if you want to survive as a trader or as a human. Study both sides of a trade and both sides of a conflict. Jelly beans & ice cream says you are only viewing one side. Study the other side and be prepared to oppose it should it be necessary in the near future. I have seen the evil first hand while defending the property rights of western US land owners. It is powerful, dangerous, extremely deceptive, well organized, well funded, competent, massive, and ugly. It should not be underestimated.
I am told many land owners along the Red River are learning this the hard way as we speak.
Golden Nugget
As I say, this sort of agenda doesn’t make sense to me, mainly because “they” already have this in place but with a huge bonus currently which is that most people have it good enough that they go along with it. If they wanted to expand it by alienating 7 billion people then they will find out that this is an impossible task in the longer term. As I say, in the current paradigm it is more logical to make incremental steps whilst enjoying almost all the “benefits” you mention without having to fight 7 billion people as well.
I am in favour of a “one world agenda” though, just not based on a monetary system. This has been debated here before in a very limited sense, but there is no appetite on an investing board for that sort of thing:)
By the way, who gave you the “target date” in the 1980’s? I think if you are going to allude to specifics then you are going to have do better than making vague statements.
imho
J
The elite no longer seem happy with money. They want power. And they want land.
The person who told me about the 911 attack months in advance was Aaron Russo. He claimed the 911 attack info was given to him by Nick Rockefeller.
The info regarding Oct. 21 was hinted in the 1980’s by a person I should not mention. He directed me to the place I would find hints regarding the attack on the twin towers and the date of their next attack which was reveled as Oct. 21 2015. The twin towers were replaced by a single tower just as implied in the 1980’s. It is still up in the air as to the next date of Oct. 21.
As you mentioned, this topic should probably not be discussed here. My apology.
Wow Jeger, This guy struck your fancy, most you have said in a month. I agree with you completely, how does this make sense to destroy the easy life that exists today for the elite. If they take it too far, it will tip over on them.
I am very interested in the topics u have laid out gold3n nugget. I do believe the #matrix exists and the elite plant clues everywhere , like in the matrix with me is drivers license 9,11,2001. And Lucy’s passport 8,24,2015. Back to the future 2 next? 10212015. Red Dragon Leo has some good stuff in his twitter feed. What forum do u post on ? Glp? @scott_Minnesota is my Twitter acct
Hi Scott, Talking about the Illuminati on this blog might be frowned upon, so I will share what I know in one concentrated piece. Anyone not interested in the laws of America, please do not read this. Please skip it and accept my apologies for using so much space.
The world is not what it appears to be. But, through censored media, it has been made to seem like what we all want..at least for now. Behind the scenes however, our liberties are evaporating. Our leaders, who are someone other than who we see in the white house, is gaining unharnessed totalitarian powers at an exponential rate.
They steal our property at gun point, they imprison innocent citizens without charging them with a crime or giving them a trial, they use the constitution as a door mat.
Recently, they have been murdering law abiding American citizens. Americans with no criminal record and not wanted for any crime. One or two were just school kids. One government official said the kids were killed because they were close to their parents. So now being close to your parent is a crime punishable by death.
Kings have been allowed to murder, but only recently has our president granted himself this “God like” power. Maybe you were not aware of this, now you are. So how many years has Obama served for murder? None. He just waved his mighty pen and made it legal for him to assassinate anyone on earth that he chooses to, including law abiding American citizens and innocent school kids.
Americans don’t act as if they understand the threat that faces them. This may be because their lives ( as they see it) is already too complex and stressful to research what the government has planned for them & their children. Or it may be because they believe the banker’s network media, that tells us everything is well and good in the land of OZ.
Major Page ( with top secret clearance) says they plan to take our children in 4 to 5 years and keep them in a prison like school for their own safety, allowing them to go home 1 weekend a month. What kind of country are they planning whereas our children will have to become wards of the government for their own protection? A government that murders and now plans to steal our children? Major Dan Page lost his job for sharing this and other info. American’s should be grateful for people like him.
The elite’s agenda right now, as I am told, is to mold our laws so they ( HML, FEMA, our military in the beginning, and UN soldiers) can treat us as enemy combatants, or POW’s, when the chaos begins. Future chaos of “their” doing. Basically, POW’s have no rights. They are hauled to the camps and indefinitely detained.
Let me point out some of the things that have already been done to mold our laws so we can be treated like POW’s in our own country.
#1, Bankers take over our monetary system and force us to pay them an illegal tax in 1913, by bribing Woodrow Wilson. Read “The Creature from Jekyll Island”.
#2, 911 attack was false flag according to Aaron Russo. Aaron warned us of the attack 11 months in advance when Nick Rockefeller, an owner of the Federal Reserve bank, informed him of their 911 plans.
#3, The purpose of 911 was to scare the American people into trading their freedoms for security. This attack allowed the establishment to take our liberties with laws such as Patriot Act 2002 & NDAA. Nothing patriotic about them. It gives the government the right to arrest and imprison any law abiding citizen without giving them access to an attorney or giving them a trial ( #1021 & #1022 of NDAA). It even allows the Feds. to torture & kill law abiding US citizens without a trial or due process. They can make you disappear.
Starting to sound like POW’s yet?
#4, Obama builds an inner country military ( HLS complete with armored war machines) that is loyal to him. Much like Hitler did with his gestapo.
#5, All rifles larger than 50 Cal. are outlawed for use by US citizens. ( Up to a 50 cal. will not penetrate the HLS armored mwraps).
#6, Obama takes all large weapons and gun ships from National Guard. How can they defend us without military grade weapons? 90% of the National Guard said they would NOT fire on US citizens if ordered to during gun confiscation.( Hmmm, maybe that is why they were disarmed.)
#7, Obama builds a US city for about 95 million so his Russians contractors, HLS, FEMA, and military can practice assaulting US cities.
#8, Obama moves his training to real live civilian population from July 15 to Sept. 15, 2015 {Jade Helm 15}. Thousands of UN soldiers observed training along side HLS and military.
#9, Obama signs TPP ( Trans Pacific Partnership).
#10, NSA illegally tapes our phone calls and Emails, and those who blow the whistle on this illegal activity go on the run to other countries ( Snowden went to Russia) for protection.
Big Brother is tapping your mobile phone: Obama admits NSA routinely spying on all Verizon phone customers in the USA
#11, Kerry signs small arms treaty with UN, obligating UN soldiers to enforce Obama’s illegal gun confiscation laws if the US military refuses to enforce them.
#12, Obama is deliberately following the Cloward & Francis Pivens strategy he studied at Columbia University, to destroy a country from within by running its debt to impossible levels and opening the borders to millions of aliens.
#13, Obama builds and or restores hundreds of FEMA camps and in his documents says these camps will be used as re-education centers.
#14, Obama spends our tax dollars to create false flag attacks (such as Sandy Hook), in hopes of taking our guns and any method we might have of protecting our freedoms and liberties. FBI and SS records confirm this to be true.
#15, Obama discovers ( through a litmus test) that 260 of our highest ranking military officers will refuse to fire on US citizens during gun confiscation, so he fires all 260 officers and replaces them with officers that will fire on citizens during gun confiscation.
#16, Obama creates Executive orders (and NDAA) that allows him to confiscate all food, vehicles, & property from citizens, and imprison, torture, and kill citizens without charging them with a crime or giving them a trial. Are we worthless POW’s yet?
#17, Obama signs an executive order that allows him to use ( unpaid ) citizens for work brigades under federal control. Executive Order 13603 – Obama legalizes slavery in America.
#18, Obama uses our tax dollars to hire and train tens of thousand Russian contractors who are loyal to him.
#19, Obama buys over 2 billion rounds of hollow point ammo that is illegal to use on any people except US citizens. This is enough ammo to fight 30 Iraq wars. Keep in mind, it is only legal to use this ammo on American citizens. Are we enemy combatants yet? Do you think he plans on giving 200 million Americans a fair trial?
Are we POW’s yet?
#20, Courts rule that any money we deposit into the bank, or safe deposit box, becomes property of the bank. They are under no obligation to return it. Also, FDIC has only enough money to cover 1% of all the deposits in America.
#21, Agenda 21 becomes their goal and objective for the 21st century. This document is signed by our last 4 presidents. I didn’t sign it. But our last 4 presidents did!
It says the population will be significantly reduced, all survivors will loose their property and be moved to a tiny apartment they will share with another family. Meat will no longer be allowed in our diet. No energy will be used for heating or cooling homes or work places. 98% of America’s land will be no mans land. Meaning, nobody will be allowed on the land unless they are a part of a government work brigade.
I didn’t write these laws and I didn’t sign them, and this is not speculation, so don’t shoot the messenger. I am reporting “SOME” of what I know to be true and accurate. I am not smart enough to make this crap up. You would have to be a banker to do that.
Have we achieved a POW status yet??
If anyone is in denial, please explain why a free nation has adopted these counter constitutional laws. Why has our bill of rights been wiped out? And explain why US citizens have to take up arms to protect their neighbors against Obama’s thieving mercenaries? If you haven’t had 30 Remington 700 scoped sniper rifles aimed at your head, all at the same time, then you haven’t lived yet. If you would like to experience it, call your local militia or give me your name and number and I will fix you a spot at the next stand off. You can take my place. Does this sound like jelly beans and ice cream?
What is next?
The elite bankers tell us their next move will be to devalue our currency and steal as much of our money as possible.
They will begin this step, according to them, with an announcement of currency reset. Because the US has the greatest debt, its currency will be set very low ( Within the 5% range). Soon after this announcement ( they have not shared this date yet), the USD will be taken from the world reserve currency status by offering the world an alternate currency backed by gold. ( The US dollar is backed by nothing. It is a fiat currency created from thin air. It only has the value we perceive it to have.) This will cause the value of the US dollar to topple at an even greater rate of speed. About this same time frame, our government will announce that China & Japan etc. will no longer buy our bonds and T bills. As a result, the government MUST go into our pensions and retirement accounts. They will say, “we have no choice, either we take your pensions or we allow the US economy to collapse immediately”. These were the exact words, or nearly the exact words they will say. Then bye-bye retirement account. They are not taking your money because they want it. They are taking it so you won’t have it. If you don’t have it, your family will grow hungry sooner rather than later. They will do the same with livestock. They don’t want the animals, but they don’t want you to have them as a source of food for your family or neighbors.
It is the collapse of our economy that will weaken us to the point that we will trade our remaining freedom for food. Their ultimate goal is to re-write the constitution making them kings of America, and the world. One world government.
As we starve, die off, get hauled to concentration camps, and struggle to find enough food to live on, they figure our spirit will be broken and we will surrender with only a few small unorganized battles against Obama’s military forces ( forces that are loyal to him and not loyal to the constitution.)
Anyone caught preparing for this crisis could be labeled a terrorist and thrown in a concentration camp under executive order ( NDAA) # 1021 & #1022. ~ Imprisoned without a trial.
There is actually some info the FBI has confirmed regarding execution devices in the FEMA camps, but I don’t mention it because I have not heard it from the elite or seen the killing devices with my own eyes. FBI reports there are 30,000 of these killing devices in the FEMA camps and in the box cars that carry citizens to the FEMA camps.
Have they made enough laws to treat us like POW’s yet? I think they have achieved their goal.
Why would the elite push for these laws and make Obama write up a martial law outline if they didn’t plan to go through with their economic collapse? It is just a matter of when. It will happen on “their” time schedule, not ours. But they have been hinting of dates such as Oct. 21 etc. One of their trusted employees shared with me what they expected to happen during this collapse. I was also given a list of things to do to soften the hardships caused by their attack.
Read Obama’s martial law below. If you don’t believe his martial law, then take it up with him.
Summary of Obama’s Jade Helm Working Paper Provisions for Martial Law
by Dave Hodges
From what I was allowed to read, which totaled 16 pages, I have summarized the provisions for martial law under Jade Helm in the following points:
1. Control of all travel. The use of checkpoints to control exit and entry from neighborhoods and cities will be employed. LEO will enforce neighborhood quarantines with the assistance of loaned military vehicles. Military and National Guard will maintain checkpoints leading in and out of cities. This is why we saw the Idaho/Washington military checkpoint checking for ID’s two weeks ago.
2. The command and control of all martial law activities will fall under the Department of Homeland Security. The President retains all executive control.
3. Refugee and civilian support centers will be established for the purposes of offering protection from anticipated widespread violence, looting and food/water shortages. The “guests” will be screened for the suitability to remain in the center. Those deemed to be a danger or in some way unsuitable, will be transported to more secure facilities. Each guest will be screened for health conditions and essential job skills which would be necessary to maintain the area. Based on the judgment of the Area Director, more vulnerable people (elderly, chronically ill, women and children) may be moved to move secure facilities for their protection.
4. Military assets will protect vital infrastructure with heavy armaments (e.g. banks, power plants, etc). No travel zones will permitted around critical infrastructure.
5. Air travel of any type will be suspended pending approval of the designated authority in both the area of departure and the area of arrival.
6. In volatile areas, dusk to dawn curfews will be established.In home curfews could be imposed until the crisis subsides. Violators will be arrested and taken to a secure facility. Lethal force can be used against anyone caught looting.
7. All business entities are subject to search and confiscation of supplies deemed vital to the survival of citizens in the present crisis. Every effort will be made to utilize private resources in an equitable manner.
8. Anyone engaging in behavior which is deemed detrimental to safety and welfare of any community will be arrested. (Note: This is the end of free speech).
9. Public or private possession of any weapon is expressly forbidden. The document spoke of voluntary gun confiscation where people come and turn in their guns. Compensation for the guns will be offered. The type of confiscation was not mentioned, but I would suspect food and water.
10. In volatile areas, the Area Commander can order door-to-door welfare checks. Further, if field officer feels that any weapon is a threat to the safety and security of a community, that weapon shall be confiscated and destroyed.
11. Food and water storage by individual citizens is encouraged. However, if shortages within a designated area occur, confiscation of these resources may occur. No citizen shall experience food and water confiscation that leaves them with less than three days of supplies per person living in any given residence.
12. There is no doubt that massive civil unrest will occur and in these instances, travel outside a designated distance from one’s home can be limited. Proper paperwork can be required based upon the judgment of the Area Commander.
13. Area Commanders will employ trusted members of the clergy to assist in restoring order.
14. Regional authorities will control the release of information under the guise of preventing panic. All elections will be suspended. Therefore, the belief that Obama will not leave office at the end of his term is correct if the martial law predates his last day in office.
15. Numerous references were made to Army Field Document FM 3-39.4 which is the means in which “detainees” will be utilized.
16. Unsanctioned community meetings and gatherings will be forbidden without written permission from the local authority. Also discussed was the disposition of dead bodies and under what conditions can funerals take place. Funerals will be replaced with memorial services and will be limited to immediate members of the family. This was a complete shock to me as I have never heard of such a thing. It is clear that the martial law authorities are anticipating mass casualties. Is this why we are seeing so many medical transport vehicles in these massive convoys around the United States?
17. Under “rare conditions” the military can secure private living space for their personnel. This is a clear violation of the Third Amendment, No Quartering Act.
18. Upon approval of the governing military authority, local law enforcement can recruit members of the community to form a posse (i.e. Brown Shirts?).
19. Violators of the martial law provisions can be tried as enemy combatants at the discretion of the local military authority (i.e. NDAA).
20. Energy conservation is called for in the event that there is power, or limited power, in any given area. Mention of home inspections for high energy users was part of this provision. I suspect that this is the guise under which gun confiscation will take place. It seems clear that the authorities want to gain access to our homes in a variety of ways. I am certain that this has to do with gun confiscation.
21. Farms, ranches and any food production center can be nationalized for the public good. This includes the transportation associated with potential food distribution.
22. With regard to the distribution of food, water and medicine (when possible), local community members will be conscripted to assist with the distribution. (EO 13603).
23. All private transportation can be commandeered for official use.
24. No private use of vehicles except with written permission from the local commander.
25. Schools, churches and other community centers will be closed during any period of chaos. These facilities will be allowed to reopen on a limited basis, and under specified conditions, when order is restored. This brings up the notion of the Clergy Response Team and the fact that the people will be told to follow Romans 13 and obey the governmental authority.
Conclusion
It was clear to me that the planning for mass casualties is a major concern. What to do with the bodies is of paramount importance to the authorities.
The document did not discuss any precipitating incident to martial law. The language is so vague in some places that it is easy to assume the worst with regard to the underlying intentions of martial law.
I want to stress that what I was allowed to view was a working document, not an official document. However, the list was very reflective of what I wrote about before. However, the notion of gun confiscations occurring under the premise of reducing energy use in a critical area, was something that had never occurred to me.
I suspect the language is vague for a couple of reasons. First, the powers that be do not want the troops to begin to form negative opinions which could lead to opposition from troops initially called upon to enforce these martial law regulations. Troops cannot be given much time to ponder their actions if compliance to an edict is offered which is fundamentally in opposition to many of the troops belief systems. . Secondly, by being vague, the authorities retain plausible deniability.
Finally, why was I permitted to see this list and encouraged to write about it? There is a strong move to encourage officers and enlisted me to followed their oath to protect and defend the Constitution. I know of others who have been given much of this information in various formats. I do not feel that this information is exclusive except for the different ways that the authorities want to gain access to your homes for the purpose of gun confiscation.
Hahaha, Thx JH, it’s like a theme park map showing us where we are so we can decide where we want to go.
I sure hope we get a repeat John otherwise I don’t know what is going to get the bear roaring in the face of such poor economic data.
Nice little chart John.
I will hold my short positions a bit longer.
Ftse weak today, oil not helping the likes of BP and Shell.
A bullish blogger at ibankcoin got snappy at my contrarian view today, be nice to re-visit in a little while.
On second glance at the chart, perhaps we are at the same spot as late in 2007, rather than spring 2008?
Doesn’t really matter either way if course.
Last month US Treasuries sold at ZERO interest yield for the first time.Then this month they sold at less than ZERO.. The Gold price immediately recovered.As useless as Gold is, its still not negative.
I agree with the market structure. It looks like Distribution.And earnings are falling.
BIG BUT……Interest rates will not rise this year. So there is no TOP.
And to all the brown bears, black bears and grizzly bears, you will lose your cash..
regards
Bobc
Bob, have a look at credit spreads and Libor/shibor rates.
See which way they are going?
Bugger all to do with a bunch of academics making proclamations.
Good luck, you will need it.
Hi,
Where can I get option-adjusted spread data?
https://research.stlouisfed.org/fred2/series/BAMLH0A0HYM2
Thanks
The big misses are mounting up.. IBM, WMT, MS, AA.
just a few of the higher profile companies that missed.
There are some better number and beats, but it’s patchy
on my take.
Phil, I have yet to see a single large company with top line growth. Earnings meeting expectiations really means very little if they are not growing their revenue. The only way to keeping those earnings meeting expectations turns into cost cuts, like Layoffs, which we have seen quite a bit from large companies. ie the better paying jobs. I suspect we are on the negative feedback curve already. Let’s see how Christmas spending goes.
Latest NYSE Margin is out
http://www.nyxdata.com/nysedata/asp/factbook/viewer_edition.asp?mode=table&key=3153&category=8
added to spy puts this morning only to see to f’ing machines moving it higher. screwed again. ibm, wmt among others trading at 2-5 year lows, yet the s&p 5% off all time highs. truly exhausting
Roll the puts to next month?
That could be it since the first support of 2025ES just came out.
Looks like another day of stop running on the shorts as US stocks surge higher. (I am “dip buying” the Grains and I expect the American Ag sector (land and stocks etc.) to recover this Winter).
I am looking for the market to top today. We’ve just had another breakout from consolidation pattern in ES contract at the beginning of US session and that may soon prove as false and as ultimate bull trap.
ES may touch bottom range of long February-August consolidation zone before reversal, this is around 2035. Also 2044 may be in play as that would provide A=C in A-B-C correction that started in August. But I would not look that far.
The market has shown that it likes to revisit zones that were only thinly traded during August crash, namely SPX 2020-2040.
Thanks. I was expecting 2040’s for SPX but the SP has started overlapping on the shorter time frame. This may indicate a pattern change to a dia. triangle 5th wave, or it may indicate severe weakness in the 5th wave.
The more bullish alternate would be a running 4.
Another well reasoned call Bunell. Since the Friday 16th Oct low We’ve had 5 overlapping waves upwards on the DJIA. An Ending Diagonal of some sort. Today’s up wave may have a little more to run.
Good call.
Yes John H, we ‘hear’ you. Now let’s hope the market participants do too. Lol.
Clueless……
as to what is holding the market up.
IBM should more than offset aapl. IBB Down 2.5% AMZN, NFLX FB…among others all moving down. yet market off fractionally. pull the rug out already dammit
http://finviz.com/map.ashx?t=sec
just sayin’
http://www.zerohedge.com/news/2015-10-20/sp-earnings-expectations-tumble-15-days-row-longest-streak-financial-crisis
oh yeah….tsla and googl just shat the bed
Frustrating…but why bother with SPX. Just short those things that are going down.
all the rats leaving the ship (hedgefunds, pension, traders, hot $$) tsla, googl, nflx, fb, amzn, ibb, etc. mom and pop 401k and blue collar joe pension fund clueless until after a 30% drop then they get to sell. must be what is holding up the market
The market is as the market does. History doesn’t repeat, but it often rhymes. Stay tuned.
The market can present us with great humor in ugly times like this market period. Like IBM blaming a strong dollar for their poor performance. Because the last 17 quarters of poor performance were for other reasons right? Now today, TSLA…. what a grand scheme we have here. A truly talented innovator and a horrible business man. So we are to believe that Consumer reports is to blame for TSLA stock performance? As if an EPS of -$4 is not enough. Constant revisits to Capital markets and Gov. incentives to buy their cars and they still cannot turn a profit or even worse show no path to profit even with incentives. Imagine if the incentives dried up. SOOOOO back to the humor. Consumer reports is the reason for this stocks decline. Maybe it is just sour grapes, because I wasn’t part of this pump and dump stock. Maybe, just maybe. And then I laugh hardily!!!!
considering the after hours announcement by GM yesterday that it has cars to compete with TSLA, I would say some lobbying dollars were diverted to advertising/influence dollars to get consumer reports to announce their article today. no coincidence here.
on a side note, I see that Oprah has upped the ante., Instead of promoting little known authors into best sellers, she is now going to become a hedgefund herself. take a position in weight watchers, then leak your ownership.
I made no such announcement yesterday, it’s a lie.
needed a laugh…thx GM and enjoy your regular posts as well
As soon as TSLA anounced they were building cars for the masses, I predicted their failure, and I am sticking to it. They should have stuck to the sports car niche. For that I give great credit. I suspect they could have made money on that venture. Right now they are on the verge of complete collapse if the capital markets freeze up on them and the Gov. takes away incentives.
today’s sell off has some 5 legger characteristics to it. We might be witness to a wave 2 bounce here.
GN, on the DJIA I certainly counted a Leading Diag down as an ULTRA tiny wave 1…..but I’ve been here before and been disappointed. EW, as always, is in the ‘eye of the beholder’….John H has said so a number of times but in much ‘nicer’ terms.
I agree.
And some eyes are better than others. And, some people know the actual rules of RNE while most do not. If we don’t know the actual rules, how can we ever be right?
I would recommend everyone who uses EW learn the rules of RNE and ignore those of Bob Prechter.
EW has split into two systems. We have Prechter waves ( that almost never work) and Elliott Wave ( that works part of the time for the eye that uses it correctly.)
I use only EW . According to RNE, the wave 1, 3, & 5 are always 5 leggers. There are no exceptions. According to old Bob, as I know him, all waves but wave 3 can be 3 leggers. If we can attach any leg we want to a 3 legger, how can the system ever work? And old Bob made other changes as well. If we hope to be successful with it, we must follow RNE and ignore old Bob’s goofy stuff.
I will say that identifying a wave 2 while in it is exceptionally difficult. If i am right about this one, it is more luck than skill. But, I was able to identify the high today within 1 point ( and bought puts there) and identify the last low within 1 point ( sold my puts there) by doing nothing but counting the legs. I am now re-buying my putties near 2026 ES. But is this a wave 2? I can never be sure of a w ave 2 until after it has happened. Nobody can.
I am using the profits of my day trade to risk buying putties here. If we get a new high, then I exit my puts and figure the 5 down was a c:4.
So far however, this rally has more of a correctional look to it. We will know by tomorrow.
Astro study suggest Oct. 20 – Oct. 30 is a negative period. It also suggest some kind of high may occur tonight causing some selling pressure to start tomorrow.
When we combine EW and astro work, we see a potential for selling pressure into the Oct. 27-28 full moon time frame. All we can do is weight out the odds. But if you see this last low come out ( 2018.50 ES) in a gap type fashion, jump on the wave 3 down.
IBB consolidating nicely. We should have a break up or down soon. I am going to predict down and possibly hard. It may even be a trigger for a wider sell off. Let’s see. Tomorrow Biogen reports, it could be a cataylst.
Many people, perhaps even most people, think (1) we are in a new secular bull in stocks (2) there will be no bear market or recession until CBs have gone through rate tightening cycles (3) that we just experienced a 1998 or 2011 style correction. All making this a glorious opportunity to be buying. But, that’s all wrong. So, got to patiently wait for this to roll over again and then when we break down again there’s going to mass confusion… and forced redemptions.
I agree with (1) and (3) are silly, but I am hearing (2) from respectable finance professors and can’t so easily dismiss.
John Li, Did you know that Weathermen were created for the express purpose to make Economists predictions look good?
`,~>
If I had a nickel for every time an economists predicted correctly……… I would have a nickel.
No JaFree, you’d still be waiting for your first nickel.
To clarify, there are a those that say that the market cannot crash unless QE is off the table. We don’t need a full rate tightening, but just the Fed to run out of ammo for whatever reason — inflation/politics/etc. Until then, the market can flatline but not truly deleverage.
What if the IMF comes out with a currency reset tonight, would that kill the US markets? Will that increase unemployment to 50% plus?Will that cause people to be hungry and cause them to pull their money from the stock market to buy food? There are many things that can affect our markets besides interest rates. If our currency is reset to the value of our country will that be good or bad? Lets see, we are farther in debt than the entire world combined. Advertised 19 trillion debt but actual debt is closer to 240 trillion. That would devalue our currency by an estimated 30%. It could make it one of the least desirable currencies on the planet. It wouldn’t be felt right away, but it would just be a matter of time before necessities like gasoline and food climbed by 50%. And another 50% the following year. Those in debt would loose everything they have and beg for food at the FEMA camps.
Changing the subject. Lets see what tomorrow brings. Maybe we can all make money with some putties in this overbought market.
red swan, black swan, I would like to see some type of winged creature sending the markets crashing toward Peggy’s spiral targets posted on 10/14
SP took out its earlier low in the night session. That means a wave 3 down is possible tomorrow. Wave 3 often leads off with a gap lower at the open.
Now we just wait for tomorrow to see.
This is worth a read….options pricing as a guide to stages of bulls and bears:
http://www.zentrader.ca/blog/welcome-to-bear-market-stage-6/
Bob janjuah has turned bullish. Therefore we must be within days of a top or Bob might be right for the first time in 4 years!
Rally up to 2034ish SPX could be a wave 1 up OR a wave 2. Astro study leans toward a wave 2. And it stopped near Fib. 61.8% retracement. If she gaps down at the open, it’s likely a powerhouse wave 3 down. If she takes out today’s high, then I get stopped out of my putties.
Astro study suggest we may hear some bad news tonight. If that is the case, (currency reset???), then gap and gonner in wave 3 tomorrow. Everyone without a position may have to chase it should it unfold that way. But it should be worth the chase. EW suggest this rally from the Aug. low has a good chance at being a wave 4 or a B wave. If it is either of these the next leg down will be massive.
The alternate is that the 1867ish spx low was an entire wave 4 and this leg is a wave 5 up. There is always an alternate and we must always be aware of what it is.
The overall “look” of this rally fits better as an abc up ( “B” or 4) at this point however. THis may be one of those rare trades that allows us to magnify our accounts exponentially while trading in one direction.
Protect above 2040SPX.
Golden Nugget,
Thanks for excellent posts. Pl continue posting.
Agreed….great posts . both technical analysis and hidden agenda. Will the eu take down aapl, amzn, googl, and fb by going after their tax loopholes and do a claw back? Announcement e xpected tomorrow
thank you Gnug for your reply above. great read. was familiar with many of the points, but a very interesting consolidated outline. would be interested in your twitter account or blog sight for topics outside of the scope of john H.
I don’t have a blog but I will be happy to give you my email.
I sent you a rather long letter showing the new laws in America and Obama’s martial law outline. Did you get it? I ask because it may have been deleted since it was more about American law than trading opportunities. I hope John allowed it to get to you.
I’ve not blocked anything
Thank you John. Some people take advantage of a blog, and their posts have to be policed. I will be careful not to get off track too often. Thanks again.
Link? I only heard that he covered his short…not that he turned bullish.
John Li,
Re the Fed and markets. Worth your while reading some Hussman posts on the subject.
It’s a fallacy though, the Fed has zero influence, once the market becomes risk averse, nothing will stop stock valuations from mean reverting (and more besides).
It’s highly likely more QE will be announced, and when the markets still seek safety, then the CBs will be out of bullets….nearly. The ECB still has its golden bullet, which will be used I am sure. But even that won’t prevent markets from doing their thing, Mother Nature and human emotions always have their way.
I love Hussman and follow his weeklies. I am just relaying a discussion I had with a finance professor.
Cool.
Professorship of finance implies something different to me, you know what I mean.
The madness of crowds. Retail joes do not see any risks here at all.
Poor stupid dupes, as always, left carrying the can.
it all feels eerily similar to just before the August decline.
Today’s test of 2033 on the futures failed, will they try again?
No idea, but I see a wall of sellers just around the corner awaiting.
Whoever this bloke is, his advice is not bad.
https://twitter.com/reddragonleo
Been following red dragon Leo for a couple years. Excellent posts. Golden nugget, I think u would like it
RD great to see some Aussie junior Au/Ag miners coming out with some excellent announcements. This will be the hottest sector in town in 18-24 months.
AZS under Tony Rovira looks like they have stumbled onto something really big. Not sure if you know that he was head of the team that took Jubilee mines from obscurity and penny’s on the dollar to $23 ps and made multi’s out of ordinary mum and pops?
Al – GOR are worth keeping an eye on too. They have some pretty cool stuff that could happen in WA
http://www.asx.com.au/asx/research/company.do#!/GOR
That is a very ugly chart. No question where we are heading.
I had mentioned yesterday that I could see 5 overlapping waves on the DJIA since the 16th Oct low. However the overnight action has created a further higher high making the current count 7 waves. However IF this is an Ending Diagonal then we should either have 5/9/13 etc waves. On that basis I’m expecting another down up sequence on the DJIA. Here’s my chart and count:
http://postimg.org/image/glzjh2mch/
To fool MOST people this ‘down up’ wave will either fall short of the top line or overshoot it by a BIG amount.
G’Luck to all.
Purvez, after overnight rally ES contract touched 2034 this morning in Europe and reversed very quickly, currently at 2024. This could have been final exhaustion move, let’s see what happens after US opens. I do not want to see ES trading above 2034.
Will those investors trapped above 2034 all year begin to sell now?
Anywhere between 2034 and 2060 there should be plenty keen to escape I imagine.
The tape should provide some clues.
Will bulls be able to absorb that selling?
And just around the corner, another budget ceiling show to amuse us all.
Bunell, I can’t get an ES chart. Is there any way you can post one please? I’m comparing the S&P one with the DJIA and although superficially they are the same there are some important details that make the ‘overnight’ count the 5th wave there rather than yesterday’s.
Sure, here goes the chart. Around 2034 seems to be a border. Hopefully we reverse down here after some distribution at the top.
es_21oct
I’ve thrown in the towel this year. I incorrectly guessed that the majority of investors had lost faith in central banks. Turns out they have more confidence than ever before. In the face of such a bad earnings season I cannot see how stocks are still rising. I cant even rule out new ATH’s any more…One thing for sure is the FED can’t blame falling stock markets for a rate hike delay any more.
Patience.
Look at bond yields, commodities, the gold/silver ratio.
All of the indicators John shares here.
I’m 2% down on my shorts right now, it may go to 6% from here, but this is just a classic end of big bull rally, which takes out most shorts en route.
Fun ahead, most likely.
I am still bearish and will continue to short and take profits/losses but what I meant was that I’d thrown in the towel on waterfall declines. We could and are likely to see more falls and more recoveries but i think we will not drop to August lows and also not rise to ATH’s. Basically a big trading range we will stay in.
Krish, (I hope this is some consolation) the chart that I’ve posted above is one of THE MOST DIFFICULT to trade. Looks easy in hindsight but because of the HUGE gyrations it is almost always a looser. Sadly one only starts to find out after the 3rd wave is done.
We cannot rule *anything* out. This is rule number one. Sounds obvious, but one really has to be able to fully accept this statement. Seems to me that a lot of people are expecting a fall – these are good times to squeeze. I am short SPY/SPX but not underwater by much, will wait to see what the close looks like.
imho
J
Interesting thoughts here
http://www.goldsqueeze.com/analysis/the-worst-thing-that-could-have-happened-just-happened
The Grains have bottomed and started back up; and, it looks like the DOW is going to surge higher today. Stock markets can be “irrational” longer than most Small Specs can remain financed against it. If you don’t have “deep pockets” like JH then you might want to consider “cutting your losses short” before you give the market generations of your inherited wealth and end up working for a Temp Agency at a local factory on the graveyard shirt sweeping the floors and taking out the trash.
Richard I, was ANY of the last part really necessary commentary? Surely we all know the consequences of our actions.
I find Richards morality very relavant.. If everyone knows the consequences, why are they trying to SELL TOPS.
Bob C, why do we need Richard’s morality? People are free to choose to do whatever they want. Richard is free to warn us of TOPs (which is VERY WELCOME commentary), it’s the consequences bit that I find unnecessary (personally offensive).
Richard, the Dow must have read your proclamation and decided to surge lower.
Too bad.
Hey GM, how did your ‘no holds barred’ game go? Hope you are having fun. I’m hoping we’ve turned the corner here.
Sometimes it helps to get your head out of the clouds and put your feet back on the ground. Honestly, the Ag market is so large in the USA that with the Ags rallying it greatly decreases the odds of another stock market crash. The Ags and Energies are buys not sells and with those two large sectors no longer likely to participate in another crash decreases the odds of another crash.
Instead of a crash, or a rally, stocks might just trade sideways longer than most expect especially with stock buybacks ongoing.
The rally from the Aug. low still looks corrective. That hasn’t changed. The SP has still failed to make it over 2040 SPX ( target of 2047ish + or – was likely), and it has thrown us a curve ball as far as a low risk short entry. I shorted yesterday near 2033SPX and remain short unless the spx can take out yesterday high.
This is called “probing” with a small position. I have about 10 March puts on as a probe. If it goes lower, then I add to those. Pyramid. If it makes a new high today, which is possible, then I stop out and look for the next place to probe again.
The downside potential here is so grand that I can’t sit this one out. I might get stopped out 2 or 3 times before hitting the top leg. Each time is painful, but not much more than a slap on the hand compared to the potential rewards.
One astro trader I know says he sees the high coming today and is planning to put on a size able trade. The pattern looked like it could have came yesterday. So there is a cluster of signals around the Tue./Wed. time frame. Its worth a probe to me. Who knows, maybe I get it right with the first probe on Tues., Oct. 20. I have not been stopped out yet even tho it is pretty scary at this point.
ES looks as if it overlapped possibly creating a 5th failure. The SPX can be called a 3 legger rally ( scary wave 2), should it fail here.
The potential downside reward is grand compared to the risk of probing short here.
Perhaps we should keep our initial probes very small and wait for impulse legs down (confirmation) before adding.
Golden Nugget, Also check correlation of SP500 with Shanghai Composite Index. Its is very highly and directly correlated in recent past. Today (21-Oct-2015) Shanghai is down 3.06% which means we may see SP500 down today by close.
Thanks. I will take a look. Sp stair stepping down right now but there is still a chance it can be a dia. tri 5th wave that lingers here a bit longer.
GN, what delta puts do you buy in March— low delta, say -.20, would be much cheaper and would magnify the most with a big down move….?
I bought 15 March 1800 puts for about 28.50. ( 215 points out of the money right now). Sold 5 today near 31.50 to reduce exposure. Still holding 10. They are priced at approx. 32 right now.
They move slow compared to puts closer to the money. When probing at a high, slow moving puts are more comfy than those bottle rockets. When I see this breaking in impulse fashion, I will add more that are closer to the money. ( maybe 1900 strike). I am too sensitive to buy the sizzler options while probing.
This trade should give us plenty of opportunities to be aggressive “after” we see it turn.
Why isn’t anyone else besides me brave enough to admit that with Gold and Silver failing at their 200 day simple moving averages that stocks will likely go higher?
Because, Richard I, we have ‘methodologies’ that DON’T support your ‘bravery’. We welcome your commentary and I personally appreciate it hugely in it’s many manifestations but please please DON’T expect me to take positions based on anything other than what I BELIEVE.
Thx very much.
Here is a simple question for everyone: Has or has not Commodities (except for Gold) Crashed and started trading Sideways to Up?
I am unable to respond to that questions because I don’t follow Commodities. I do however appreciate your ‘take’ on them.
Richard I, if you can post a chart of any commodity that you find interesting then I would be very willing to take a stab at an EW count on it….just for fun?
http://www.pretzelcharts.com/
Pretzel shows a chart of the S&P that is identical to what I am looking at.
This pattern is maturing, provided we are right about the wave count.
commodities like oil, gas, coffee and cocoa? no they are rolling over to new lows. there are a basket of commodities that are doing as you suggest, but this blog generally steers clear of them with the exception of oil and gold
Look, it’s all very simple; “If” the Bear Market in Commodities is over then BUY THE DIPS! Why? Because it doesn’t matter if Commodities trade Sideways or Up “buying the dips” is profitable (and that is what I am doing).
Seriously, I think JH should do a report on the Commodity (Super Cycle?) Bear Market ending.
Is the FED intentionally “behind the curve” in order to promote “commodity inflation” –before– raising interest rates?
http://www.businessinsider.com/shrinking-labor-pool-leads-to-payroll-declines-2015-10?r=UK&IR=T
Seriously, FED Conspiracy Theorists ought to jump all over this (except for Gold).
Conspiracy or not there is ZERO doubt in my mind that the Fed intervened in the markets in September via REPO.
Glencore was a $100 billion event and it posed a huge threat to US IB’s but a cataclysmic threat to Douchebank.
I have spoken to several people within commodity crcles and there is no doubt whatsoever.
SLV is bullish if it can stay above the 14.29 support level. So far it has accelerated in 5 leg fashion. This pattern opens the door to a possible bullish trend change. Although many are calling this another 5-3-5 rally. I am long silver from very near the low, but it is physical silver so I can’t stop out on this one.
Are Commodities at the usual mid-cycle low before the super run up to the 55 year peak?
https://search.yahoo.com/search;_ylt=AqdZbMCy5nqcRpRHSHAw9b6bvZx4?fr=fp-yie10-s&toggle=1&fp=1&cop=mss&ei=UTF-8&p=commodity%20super%20cycle%20chart
http://www.businessinsider.com/commodity-kondratiev-cycles-2012-4
Ellioticians: Note that in the Commodity K-Cycle lows to top there are usually five waves up. Note that in this Commodity K-Cycle low of 1991 to expected top in 2035 that the 4th wave bottom may have come in the 3rd Quarter of 2015 and is going back up in the final 5th wave to the K-cycle top.
Richard I, almost ‘every one’ of the charts that you linked to in the Yahoo link, to me at least, suggest an imminent DOWN turn. Am I missing something here?
Admittedly I don’t follow commodities so it is based on a very cursory EW biased glance but I’m struggling to make any of them have more ‘head room’.
Once again we have a central bank that is prepared to step in and save an entity that through incompetence, speculation and greed allowed itself to become overleveraged to the point of posing a global threat to markets.
The consequences for the actions of those involved?………zilch!
Allan Greenscum set the precedent for this modern interventionism during the LTCM collapse and now it is all but expected and acceptted and accountability is all but non-existent.
Personally I can’t wait until this whole system comes apart.
New Thought: The Solar Cycle Crash only effected Crude and not Stocks this go around. Why? Because it ties in with the final (usual 2nd) Long Wave top and down before the final Long Wave back up to the K-Wave top due in 2035 for Commodities.
Over the past several days, on hourly charts, DOW futures are starting to rally parabolicly. This ought to be a warning to the Shorts.
Richard, what I see is a market that is back-testing a historic breakdown that began in August.
What I don’t see is 50 dma’s reversing back up or momentum increasing. In fact quite the opposite. Momentum is waning whilst MA’s continue in decline.
Jeger,
“We cannot rule *anything* out. This is rule number one.”
Spot on! I have yet to meet a person with a two headed coin in this game. One constant that I can say is that the market will continue to fool us. Which is mainly why I try to stay on both sides and modulate around probabilities. Right now I have thrown out a huge cash anchor to stabilize returns/losses. My position is that even if this market does go up, how far can it really go. If I miss another top, I will not miss much. I seriously doubt it can go too much higher. If it does go up, I will be selling more core holdings and move that to Energy commodity trading, which right now I am suffering a bit, but I am resolved that it is mostly done going down. My take is the stock risk is to the down side and I am willing to wait for it, whether it is next few months, or next year.
The economy is not good and I do not see it getting better anytime soon. Biogen, while not a big layoff did anounce a layoff. Along with many other high paid layoffs. These layoffs HAVE to ripple in the economy. My best bet is that any up movements now will be eventually be met with a quick sharp decline once the buyers run out of steam.
Good Luck All.
Hmmm… we are beginning to get our parabolic ‘tantrum’ top here at DJIA 17315. I’ll be willing to take a downside bet once we are back under 17280 the ‘second’ time around OR under 17210 the first time around.
Minimum downside target under 16000.
Just to clarify Minimum downside target is ULTIMATE target….not a straight shot down. But then you guys knew that, right? Lol.
Ugh I didn’t mean get down to 17210 in the next half hour!! I’d have preferred a ‘second’ chance at the 17280 level really!!
This market doesn’t pay attention for weeks on end and then decides to obey every ‘teeny tiny’ wish. Ugh and double Ugh.
Looks a bit bear flaggy on a 15 minute chart right now. Next leg down?
support bounce at 17210…nice charting purvez…hope we see your 16000 target next week. 10272015 would be an ideal date and correspond to Peggy’s spiral. she has been very quite lately, but provide great upside and downside targets
Scott, hold your horses we haven’t cleared 17210 yet. 16K by next week is a VERY TALL ORDER…..maybe that’s why it’s achievable, because no one thinks it can be done. The market ‘lurves’ that sort of stuff.
I bought about 15 putties yesterday. They are all profitable. Since I can’t tell if this is a die tri, I am taking 1/2 off with lunch money profit.
Nice call GN. Taking profits never hurt anyone. Who say’s there isn’t a ‘free lunch’ ….occasionally eh?
I plan to put them back on ( and a lot more) when I see a more convincing sell off. Or if and when I can identify the pattern ending at a higher level.
90% chance this is a death pattern. The challenge is achieving a low risk entry.
~~Just in case that 10% chance rears its ugly head.~~
if we get another small leg down from here to about 2017-2018 spx, and the spx bounce respects 2026 spx as resistance, we may have something to hang our hat on in the bear arena.
Pressure back on the bulls again, Richard jinxed it for them, commodities also.
I won’t tell a soul Richard.
The Grains closed up and I am buying the Grains on Dips.
Richard was salivating over the CAD gains against the USD a couple of days ago.
Today not so much.
Watch the mighty dollar, it is creeping up on the rails, a bull killer.
GM
Not quite sure I understand your comment.
Are you saying a strenthing $ is bad for the stock market??
The global dollar short is being squeezed. Hence dollar index to c.120.
Not positive for much of anything, including stocks.
GN
When you refer to “putties” these are puts yes? If so, why use options when they are pretty expensive now…?
J
Yes, I bought March puts on futures. Yes they are pricey, but when this puppy drops they will get a lot more pricey. I was in them at 30.00 apiece and sold 5 for 31.75 each. Still holding 10. I still can’t tell if this is morphing into a dia. tri. 5th wave. If it is, I will wish I sold more putties than 5. If she has already started rolling over, I will wish I kept them.
Just reducing exposure in case this unfolds into a long drawn out dia. tri. pattern that stretches into early next week. Full Moon.
I can always buy them back when the road ahead is a little less muddy. Big picture not too muddy, ( blood in the streets), but immediate future says we must jockey for position if we want a low risk trade location.
This bounce so far has been stronger than I hoped for. SPX has shown no respect for any of the smaller resistance levels. This suggest I should have taken off more putties.
The full moon is powerful and often works as an attracter and repeller. This means it may suck the SP up into early next week and then slap it down hard. I doubt the price will move a lot higher however. It will be the time that works on our nerves.
Good post, Nugget. Yes, Full Moon attracts and then from FM open repels.
Valley, please may I ask, are the next 2 days positive on PALS? I seem to remember thinking that it was the early part of the week that was weak.
I posted earlier with spx hitting 2037.97 completed 5 waves. Thus ready for a pullback from a bull count from 1867.01 which is trying for a new high count 12 1) and 2) when this correction over.
The bear count indicates 2037.97 completing a 335 upside correction from 1867.01. To prove the bear case, prices would have to drop sunstantially to indicate a 5 th wave low below 1867.01 is possible.
Bear case is kept alive see in a monthly chart and set up MACD. That indicates a downtrend can persist for many months.
Hope this makes sense.
Hi Purvez, yes neuronal master, I am trading with bullish reversal pivot sometime late afternoon Thursday lasting at least until next Tuesday’s Full Moon. FM has very short term but strong upward pull on price that ceases at open of FM day itself.
I want to state some basics
The US market is seen as a safe haven
Outsiders are attracted to this market and will buy stocks
They need to invest with $
$ are in demand which make them go up in value
And the demand for stocks also makes them go up.
So the rising $ leads to a rising stock market.
Does anybody disagree??
Does everyone see US stocks as a safe haven?
Price action over the past year indicates that is still being debated.
You appear unaware of (for example) Saudi selling of US financial assets?
USTs still seen as safer than stocks I reckon. One day that will reverse.
This may assist…
http://www.alhambrapartners.com/2015/10/21/between-eurodollar-and-real-economy-we-find-predicted-oil/
The dollar is not what most imagine it to be.
Bob C, I’m in agreement all the way…until the second last sentence. Not sure how you get ‘rising $ leads to rising stock market’? Your explanation on ‘why’ you believe that to be true would help here please.
Sorry purvez
Badly worded
It should read
So the rising stock market leads to a rising $
I would like to add some more basics
If Saudi Arabia were selling stocks in volume, the $ would fall.
And GOLD will increase.
Bob, as I mentioned above, the *dollar* is not what you imagine it to be.
All I can do is point in you the direction of Jeff Snyder’s writings, many of them, to help you gain some insight.
Suffice to say here, the dollar’s price is not determined within American shores.
Thank you GM
I will have a look at Jeff Snyder
Bob, Value fundementals are not ignored. Even if I agree with you, I think the fundementals are changing and valuations are high and soon they will look worse as we start to see the reality of what earnings reports mean and this may not be evident to many until it is too late. Safe Haven in a crashing value senario still goes down.
Hi JaFree
I agree with you
Fundamentals are changing, infact, they have changed., and QE has done this
The search for yield remains the basis of investment.
Its irrational to accept no return. But even at the markets overvalued prices , there is still some return. Us Treasuries are negative.
So until interest rates increase,the market will not crash
Likewise ,while there is a strong $, the market will not crash.
And PULLBACKS are a buying opportunity.
Love to see bulls with such strong belief in the power of QE.
Obviously never read a word Hussman has written about mean reversion, profit margins, Fed impotence in the face of investor risk aversion.
Good luck Bob.
Every time my ‘spirit’ is weak I doubt RNE (Ralph Nelson Elliott) and then something like ‘this evenings’ action happens and my faith is restored.
RNE said that after and Ending Diagonal the return to the base of Diagonal would be ‘SWIFT’…..WELL you can’t get much more swifter than this.
In my bookes the ED started at the lows on Friday 16th and took 3 days to complete the ED
Uh oh… don’t know what happened. I’ll restart at the last para:
In my books the ED started at the lows (DJIA 17107) on Friday 16th and took 3 days to complete and today in a couple of hours it’s trading very close to the start of the ED. (Traded as low as 17129)
The RNE system is solid. It is old Bob’s system that is jumbled. His system violates almost every rule of Elliott. How can his system work when it operates in contrast to the RNE system?
Then when Bob’s system fails, over and over, everyone blames the EW system. RNE is taking the blame for the violations of others. I bet he is turning over in his grave.
Seems the end of the world or any other Satanic conspiracy failed on Oct 21. It was my birthday so I hammered down my horns and pulled up my hair to cover.
So do we have a new date as all “doomers” generate when each one fails ?
Christians have been looking for the end for 2000 years.
It amazes me that we still get people believing in fairy stories even today.
Let’s stick to facts and leave superstition to the morons amongst us.
I would only place faith in myself tbh, no system works all the time. Not Valley’s, not the spiral, not EW and not the most complicated algo’s developed by people with billions of $. It can be comforting following a system or person, however this really prevents us from taking responsibility imho. I am not saying we shouldn’t share ideas and learn from each other, just saying that there is often just no “explanation” or “reason” why price does what it does. I would go further to say that it actually doesn’t matter.
imho
J
Yes I would agree, jegersmart. I’m not shirking responsibility for my decisions just explaining that the system that I follow has served me well and despite my occasional ‘loss of faith’ tends to astound me in it’s ability to help identify expected market movement.
Not infallible but certainly a HUGE lot better than thrashing around in the dark.
Jegersmart, while you are technically correct that PALS does not work 100% of the time, if one is able to find a system with 55 to 75% market advantage it is useful. JH’s Lunar Edge article gives a clear clue of what can be gained by being long FM plus four calendar days to NM plus four. When combined with apogee (moon greatest distance) and perigee (moon closest distance) effects which clearly show perigee minus 8 calendar days is where most of net gains of entire month are made you have a directional system that is higher correlated with movement in SPX. The proof of the pudding is in the eating, and PALS has satisfied my need for market directional forecasting. Much appreciate your posts and the other many fine contributors who have taken time to share their ideas.
Hi Valley
Of course, I am just pointing out that blind faith in a system can be harmful to one’s financial health:)
No disrespect to any system out there, and those who share ideas.
J
Absolutely correct Jeger. You have to have your own system and based on whatever you can make work. I refrain from giving specific advice to people looking to get into the market for this very reason. I tell them to start reading about what they are interested in and then start slow. They have to build that experience and it is usually a multi-decadal learning experience before you gain that confidence. That is if they don’t get eaten by dispair and push through to anly be better. Of course I will answer questions and point out common learning practices and techniques, but only if they show dedication.
Yesterday was a “Bear Trap” for US stocks. The Baltic Dry Index has turned up in an Elliot major 3rd wave and many Commodities and commodity currencies are turning up in Elliot major 3rd waves too.
Doesn’t Iron Ore production and Iron Ore international trade tell you something about the truth of the World economy? And no, I am not talking about Iron Ore prices.
I am looking at a Dry Bulk report from this weekend, most ship types are reported as rates dropping back quite substantially so far, especially in the Handy/Supramax segment, with 200 ships open – up by 40 from last month. In the medium term, the supply of new ships is overall viewed as overwhelming in almost every segment, coupled with relatively lower bunker costs, speeds are up by 0.8-1.5 knots as operators rush to make hay whilst it lasts.
Let’s see what happens in any case, I take it that you are correlating the increase in freight rates into an “increased demand indicator” and then connecting that to a single day’s trading yesterday?
I would hesitate to make such narratives tbh.
J
http://www.bloomberg.com/quote/BDIY:IND
Hmmm, Richard I may be right about his ‘Bear Trap’. Thx to our ‘healthy eatery’ McDonalds results we now have an ‘up’ wave on the DJIA which is trading inside the region of the down wave-i from yesterday’s high. The down wave from yesterday’s high never became a 5 waver.
So….I guess we have to entertain the possibility that we’ll be going higher than AT LEAST yesterday’s high.
The only saving grace would be nested 1/2 i/ii etc.
Let’s see what the market really brings us.
Dax heading for 11k again. It has posted the biggest loss so the recovery could be mega.
Voltaire, I have a saying I like to use. The end of the world is always a few years away, until it is tommorrow. For the most part I am convinced it is a coping mechanism to allow us to evaluate what is causing the fear and take action against it. Things like population bombs, year 2000, Nuclear winter, Asteroids and the like, we use this to change our course. For things like Myan Calendar and 2nd comings, not so much to change. But rest assured the boogie man will re-appear in a new form. To me none of this has anything to do with personal faith. That is a choice for each individual. The Boogie man will use whatever tool he can find to create the next fear and hijacking any prophecy to do it is the rule. It is mostly humorous to me to see what will be raised next. Young minds are easy to fool.
I find it baffling that so many can’t stand back and objectively think about what they have believed and ask why. I guess for most its easier to NOT think.
Just you and me are normal 🙂
ECB very dovish today. Central banks clearly still control the thought processes of investors who in turn control the market prices. A lot of people disagree that central banks control markets but they clearly do indirectly. I expect a mega mega rally into year end which should obliterate any bears who are holding positions. Smart Bears will remain cash and wait for the parabolic ascent which has started today. Only a reversal and large negative finish today would invalidate this comment.
Re the central banks….boring and wrong.
Re the parabolic move into year end, what, based on the last little bit of a short squeeze?
I remember 2007, this feels exactly the same. Chop, chop and a bit more chop, then bang.
I just got in, so catching up to do, but suggest nervous bears have a look at the IWM chart over the last week, look at commodities, and…wow, here comes the mighty dollar.
This will end badly for the bulls.
Ftse did bugger all today, so I’m reasonably happy. If I was home, I’d add more short tomorrow. No matter.
Market Humor for the day – MCD, a beloved comapny for me. I still eat there on occasion. I have been invested in and out several times over the decades as well for good Divs and returns. Sooooo…….. One company has a good report and we rally hard? Is MCD a stallwart of economic activity, or a cry of desperation for cheap food? Hahahaha!!! Well, I guess we will find out and I am happy to see MCD doing well. Meanwhile most Earnings reports are dismal and that continues to be the norm this earninsg season, with more to come.
I am not discounting the rise in bullishness thoughts and I take that possibility serious, but I must raise that crashes always start at the height of bullishness thoughts. I can envision big money framing this last quarter for the year to be a good one, If they can pull it off. However, I also will not discount that big money also will not initiate the big sell off actions until they have coaxed in enough money to unload their volumes and they control large portions of the press.
I will sell my core holdings into any significant rally that appears. I currently sit at about 40% cash and I could envision going to 60% cash if we rally into the end of the year. I am currently at the highest cash position I have ever been in my 25 year history of investing.
At some point the Market will have to yield to the failing economy. I suggest we are in the stage of deception that the economy is failing, but those forces will not be squelched in the long run.
Are you going to short at some point, or is 100% cash the maximum you would go?
I generally do not short very often, I did so a few weeks prior to the Aug. Sell off, but I used JH’s idea to also go long AU & AG, which made my return modest. I do not have the confidence to go short again, but I also would entertain the idea that I just take my money out of the Stock market completely and look for Rental Houses. But that would be 2017 time frame. Cash is a Giant anchor on returns. You can beat the market with cash if it goes down. You loose opportunity if it goes up. I am comfortable with cash right now. One method I like to do but have not done since the 2000-2003 time frame is sell puts on companies I want to buy. It is a great strategy in times of fear. I like to do it on dividend companies. Not enough fear yet if we even get to that level I cannot say. I am also trading in the energy sector which I think is mostly done going down. It may have another weak moment though. Nat Gas is my biggest area and it has not been good for me yet, but I am sticking to it. The cash is my trading enabler on this sector. I haven’t done any trading in weeks though, I am watching to see if we get the stablization I have been expecting.
Thank you so much for this. I think your strategy is very wise indeed.
The rental yield is not so great in my area, but I think it could get better if prices come down.
Agreed John, The logic of going rental is we get more distressed property opportunities. So that would have to occur. Too far to really make any choices at this time. In truth, I am a bigger believer in the JH ideas for my own reasons, but his work is confirmation. Which I am grateful of his analysis.
Instead of saying the Chinese can’t do this and can’t do that how about saying what they can do such as transition into a Consumer Economy? With the American economic revival why can’t the Chinese transition into more of a Consumer Economy instead of the World’s manufacturing plant?
Note that World production of Iron Ore and international trade in Iron Ore keeps increasing even though prices have slumped.
Their biggest hurdle is the understanding in the idea of a free market economy. Being of Communists thoughts, this is a fundamental hurdle. Not to say it cannot be done, but it’s not easy either. First they need to finish building their Stock Market and parading people in the streets as the cause of the recent crash is not how you do it. Stopping the sale of some stocks, but not all of them is not the way to do it. You have to allow a market to find it’s own equilibrium. If they do accomplish it, we could see them finally fullfill the idea that they can overcome the US Economy. That is not to say the Western World has not fallen into failure of the free market concept either. We have been going down a path of CB manipulation and not training our young that a free market means bubbles and crashes. Expecting a result and trying to mold that result does not work in a free market.
Wow, the market does it again, shorts squeezed, ES contract again at 2034. Must be repelled there otherwise things may look bad fot the bears !
Ever increasing Iron Ore production along with ever increasing international trade in Iron Ore argues strongly against the Demographic issue….at least for now.
Note that both Australia’s and Brazil’s largest exports aren’t the Ags anymore but Iron Ore.
People, once again we have to give a ‘salute’ to Valley. This is what he said yesterday:
…”I am trading with bullish reversal pivot sometime late afternoon Thursday lasting at least until next Tuesday’s Full Moon. FM has very short term but strong upward pull on price that ceases at open of FM day itself.”
Well perhaps we started earlier than Valley suggested but there was NO DOUBT about the direction of his call.
Mine, on the other hand HAS VANISHED. Ah well. I’ll have to spend more time writing out a 100 times:
‘The ‘market’ knows better’…or some such.
Hope people are alive to fight another day despite this insane ramp.
I’m trying to re-group and work out what the next EW count could possibly be. Suffice to say it ‘looks UPWARDS’
Double UGH!!
the muddy mess from 2030.92 SPX high to 2017.28 low was a complex correction. Now in the impulsive wave 5 up.
This should be the last leg but it will consist of 5 legs. Provided there wasn’t a running 4 in todays blast off, the 2055 SPX high should have been the wave 3 of the 5 up. Currently should be in the drify/chopy wave 4. when its done, one more smaller 5 legger up is needed.
My guess is that the floor will try to throw us a curve ball in the final v:V:5:c to shake off as many bears as possible. I made a little on 1/2 my puts but still have 7 that are now under water.
SP should drift in w4 for the rest of today. Occasionally we get a brief w4, but its rare. Its time for the market to digest what it gobbled up this morning.
If nothing else you have to admire the markets’ unnerving faith and confidence in CB omnipotence despite continuing deteriorating global health and I too am very impressed at how well they engineered this market recovery off of what was possibly the worst technical picture in years back in September.
Australia’s increasing Iron Ore production along with Australia’s increasing Iron Ore exports points toward the World evolving a Middle Class many times larger than what the USA’s Middle Class was at its pathetic heights a generation ago.
The fourth or final (long) wave up of the K-Cycle rally in Commodities is beginning and, soon, those increasing record high Australian exports of Iron Ore will be at new record high prices too. When that happens the Australian Dollar will soar and Aussie priced Gold will fall….and hard.
Rchard where do you form these views?…..there is a huge over capacity of steel production and an oversupply of iron ore. Chinese steel manufacturers are now exporting more steel than ever due to a lack of domestic demand.
As for your comment on AUD it is about as absurd as your recent comment that US retirees would cause the gold price to collapse..
ASX listed gold stocks are outperforming and the Gold index has broken out and 99.99999% of investors are completely clueless of the fact.
Oh and what about the fact that Au but particularly Ag is up today despite the USD strength?……..I suppose that is a huge negative for the metals is it?
It seems to me that SPY hitting 200SMA reaches a tipping point for bears to act, and so we should at least pull back for a few days. The FOMC meeting next week might complicate things, but I would be reducing my longs as well, in agreement with many above.
Poor Bio-wrecks, can’t get any love, not even on a big day. IBB continues to consolidate tightly for a break up or down. I favor down, but in this market, who knows.
Yes it seems that bears with the right positions can be very happy with UA, TSLA, VRX, etc.
People, this sort of parabolic ramp higher ALMOST always ends a lot lower.
No guarantees but I’m expecting a reversal. Will it be before today? No idea.
Will it be before next week, MAY BE.
Will it be before next month, 90% sure.
Will it LAST? Aaaah NOW people you are asking TOO much.
lol
Yesterday was a Bear Trap and today is one of many days to come of the slaughter of those Bears. Looks like the DOW is going to a new ATH and that puts the Solar Cycle seriously in doubt about it’s effect on Stocks instead of only on Crude.
Rich,
Sometimes , lots of times, you must bite your tongue, and keep quiet.
Whole move down to 1821 but apparent bear market rally since appears to be a bear trap. ES futures now above 200 day moving average. As a bear I have to concede I have been wrong. Right about calling for the big decline in the first place, but wrong that the decline has not continued. Analysts like Caldaro calling for new highs appear to be right.
If we called the 1875 low on 9/29 a 5th failure or a wave 2, that would make this current leg very bullish and would certainly mean new highs. But when we factor in what John has brought to the table, that wave count doesn’t fit. The best fit is still calling this move from Aug. low an abc. But, the C portion has been strong ( as they usually are) and it has exceeded the 2047 target I had for it back in late Aug. And it has exceeded the 2047 equivalency where wave 5 is equal to wave 1. But at this point we are only talking about an overthrow of 6 points in a retracement expected to be 180 points.
This current leg is certain to be a wave 3, and if this is an abc, it is the 3:v:5. I may use the following wave 4 sell off to sell my remaining puts ( that are now under water), but I am not convinced this is a new bull market leg. On the other hand, I think everyone should do exactly what they believe is accurate and we should always protect our probes when ever the market becomes a threat.
The pattern ( combined with John’s work) says this wave 3 will end soon ( today) and be followed by a wave 4 correction. Then we see another smaller leg up v:V:5.
This final leg should coincide with the full moon. I was wrong to probe in the 2030’s when I had projections that went higher. That’s why I call it a probe and not a position.
Plan the trade and trade the plan…until something proves it is a bad plan. You may be right about the new highs, but so far I have not seen enough to convince me anything has changed in the big picture. It might be a mistake, but I will probe again after one more pull back and one more impulse leg up. It often takes 2 or 3 probes to get on board when a massive leg is expected. What concerns me most is that this trade is just too obvious. The three stooges could see it with the eyes of Ray Charles. When they are this obvious, we should approach them with a bit more caution than usual. Not trying to talk anyone out of a long position, just pointing out that a B wave correction “can” exceed a projection, especially when its within the grasp of the full moon. The potential down leg will be huge. Do you think the market makers are going to make it easy for the little guy to get on board? If it was easy everyone would do it.
And an abc pattern is still valid at this time.
I intend to stay with “my plan” to probe short as this leg matures. And it still has one dip and one more up leg to accomplish this.
FWIW, this is from a local commodity annalist. He and I worked together in the late 80’s and thru the 90’s.
The market shakes off the weak longs and then starts up again…squeezing the shorts. We may yet see that surge to 2065 ES.
BUT IF WE DO THAT WILL BE IT!
http://theeconomiccollapseblog.com/archives/expert-that-correctly-predicted-market-moves-in-july-august-and-september-says-stocks-will-crash-in-november
Omg, OGM!!! The December DOW futures looks to go another 200 points higher without the cash (real) DOW moving at all. That is because the December DOW futures are going from Backwardation to Contango as it goes from bearish to bullish of the cash (real) DOW. That means another $1,000 more loses on the mini-DOW futures besides the loses already sustained by the Shorts. If a person doesn’t have the deep pockets that JH has then they might want to consider this trading reality of the futures to the cash markets which happens from time to time.
Of course, it has other implications too and I wonder why others on this site haven’t mentioned it. (Inexperience or market Ignorance?? Tunnel Vision high I.Q.ed Arrogance perhaps??).
Richard, must say that I agree with you. If we do not reverse today in a meaningful fashion then it means new ATH before the end of the year. And VIX around 10 again…
It seems they want to take it to 200 SMA at SPX 2060 even today !
Actually ES contract already broke through 200 SMA:
http://www.zerohedge.com/news/2015-10-22/sp-breaks-key-technical-resistance-now-what
Is there any EWer here brave enough to give a count from either the 14th Oct low or even the 29th Sept low. please? Ideally DJIA but I’ll take an S&P count as well.
Today’s wave higher I just can’t shoehorn into anything sensible at the moment.
The ONLY thing I can think of is that from 14th Oct low to yesterday’s high was not ALL of wave-5 from 29th Sept low but just w-i of wave-5. So we are now into w-iii of wave-5 (certainly has the impulsive characteristics) and we therefore have another down up to go after this wave finishes. God only knows how much higher all that could go.
from 10/14 low SPX
w1=2007.70, w2=1997.63 w3=2030.92, ( w3 could be argued to be 2033.49) w4 was the tough one but is usually an easy one. w4 = 2017.28, now in w5, and this w5 is almost done, looking strictly at the pattern, I can’t see how it will make it to next Monday or Tues. full moon. The pattern suggest it doesn’t even have another day left in it. If I had not already probed with 15 puts, ( and got trapped with 7 of them) I would be tempted to start scaling in here at 2062ish ES. It looks like 2065 ES should do it based on the pattern. But dropping this close to the FM doesn’t make since.
It is possible that the top comes in on Fri. and then the FM slaps it down on Monday. The FM can effect the SP up to 2 days plus or minus from the actual FM date.
I should have taken my profits on all my puts last night when it dropped in an overlapping 3 leg fashion. Huge mistake. The ES said to exit shorts at 2008ish but I feel asleep at the wheel.
3 leggers point in the wrong direction. Last night they where pointing down…wrong direction.
John H could we get an update on your positions? Still short or have you capitulated looking to enter at a higher level/more bearish setup. With earnings now negative I think we have turned a corner but as always stocks may rise further before falling. Today is incredibly damaging to the waterfall decline scenario.
ES futures have broken thru 200 day ma but Cash spx with high 2055.20 has yet to achieve spx ma 2060 area. It is hard to believe this huge market thrust has been motivated by Draghi’s easy tone today – this undying belief in central bank control!!
IMO it’s not Draghi, it’s investor sentiment. The news is just the excuse that traders/investors use to justify buy, buy, buy. They were all ready to buy and the news was just the trigger.
This does not bode well for a bear market any time soon. Pullbacks, yes. But no lows, I don’t think so. Maybe next year. Maybe 2017.
should read “new lows”, not “no lows”.
Patience here. We can see this is just US large caps as things stand. US small caps, junk bonds, FTSE, Dax, HSI: these are all much lower than US large caps. Biotech is still in a weak bear flag. Yes I still hold all my positions. Nothing has changed. Some charts…
THE charts still support a bearish outcome to this bull leg. We still need a wave 4 down and one more bull leg up. BUT, if there was a running wave 4 in today’s impulse, then the wave 4 and 5 are already in the mix and this is the complete blow off top.
The SP is currently selling off more rapidly than it usually does in a wave 4. If it continues, then I will have to conclude this impulse leg carries an unseen running 4.
This leg down should be drifty in nature. Sideways to down. Often called a small bull flag by many. Then one more smaller impulse up to finish this entire leg up.
At that point it will go down in a more meaningful way. The bulls can call “that” move down a wave 2, while the bears can call it a big massive “C” wave of 267 points and possibly a lot more.
But this up leg should not be done yet. it still has a 4 down and a 5 up before completion. This is so obvious that we know the market makers will do something to shake off the bears. The final 5 up will either extend, or truncate ( fail). It is the way of things. The floor moves in mysterious way to take our money. Todays action was an obvious short squeeze paper hunt. Unlike us, the flood sees the stops. And they want um. And they have the money to get um if they are close enough. They push to the stops and let the short squeeze do the rest. Wha-la, powerhouse wave 3.
The S&P is running out of legs. Maybe a few tiny ones left in the upward direction. I don’t know how it will stay up until next Monday. But on the other hand, the full moon says it will. It will be interesting to see if the pattern or the full moon takes dominion over this top.
An astro trader from the 90’s always told me that a CME that came close to the earth, ( and especially if it glanced off), would cause a trend change. If it happened within 5 days of the full moon ( 5 days to the best of my memory), it would take dominion over the full moon and cancel out the full moons effect.
On Oct. 22nd, a solar flare in the magnetic canopy of sunspot AR2434 lasted for more than 3 hours. The slow explosion produced a CME, which is expected to deliver a glancing blow to Earth’s magnetic field on Oct. 25th.
What I don’t know is exactly when the CME will effect the market. This astro trader had a formula he used to pin it down pretty close, often within 15 min., but he never shared it with me and calculating the formula may have required special software from Harvard University.
But the point is, I have been perplexed at how this pattern could stay up until the 27th FM. Now I have an idea. Sat. is the glancing blow, so we could easily see the SP top out on Fri. due to this event and gap down on Monday morning. This would allow the pattern and the astro event to line up together on Fri.
For the first time since I probed short I have info that says an important turn could be upon us sometime on Fri. And, the pattern agrees. If I would have taken profits on all my probes last night, I would be slamming it short pretty hard when I saw another tiny leg or two up on Fri.
The CME’s I watched him trade always worked, but they had to be big and close.
I don’t know the “SIZE” of the CME on Sat. but it’s certainly close. He always got excited when they were glancing blows. Those seem to be the most reliable. It will make sense now if the pattern runs out of legs on Fri. and the SP gaps down on Monday, ( several days “before” the full moon.) When such an event took place on a weekend, he would often put 1/2 of his position on Fri. and put the other 1/2 on Monday. He was the best trader I ever knew of when it came to entry positions. He often depended on my chart work to help him exit. An average position for him was 800 minis. As a broker I would often put his trades on ( round trip as they were called in those days), his last trade before moving to Costa Rico yielded a profit of 8.8 million. His average annual profits were 144 million. I hated to see him go even tho he was a grouch. He left to avoid a possible economic crisis in the US.
I just leaned of this CME a few minutes ago. I wish I would have known about it a few days ago. I might have kept my itchy finger off the trigger a little longer.
Ok. I’ve entered a very small short on the Dow hoping things will turn down soon. Its a much better entry price than most and nearer the top wherever it may be. Stop near 18000ish. Amazon, alphabet and Microsoft had pretty decent results so that might add more fuel to the recent rally.
Golden Nugget!
Super information you are sharing. Also like your EW thoughts on the market! Thank you and keep up the good work. 🙂
Cheers,
W
I have some new info but have not done the math yet. From a chartist point of view, we will notice that in many powerful legs there will be 3 gaps. This is chart reading 101 by the way. The first gap takes place near the bottom or beginning of a bull leg. This is called the acceleration gap. The second gap takes place almost exactly in the middle of the gap. This one is called the midpoint gap. The third takes place within a day or two of the top of the leg and it is called the exhaustion gap.
I just eyeballed an hourly SPX chart. Everyone reading this should do the same.
Can you see the first two gaps from the low? Is one of them near the low? Now look at the second gap, midpoint gap. If that is the “exact middle” of this leg up, what could we call the opening gap this morning? Yep, it fits well as the exhaustion gap.
I will do the flip math and see where the midpoint gap projects to and get back with you. Just eye balling it, the projection should be close to the open. Now, the mid point won’t be exact, but it is surprisingly close.
I just did the gap flip and it looks like the SPX will open above it. This means the markets should begin selling off from the open. This conclusion is from the gaps only. But we are also out of pattern legs, and we have a cme tomorrow.( Not sure if it is big enough however). From a trading standpoint, I want to see this gap faded within 10 min. of the opening. If it isn’t, then from a trading and money management stand point, I need to pull my 7 putties to the side lines. This doesn’t mean I won’t put them right back on if and when weakness occurs however. The move down should be massive and give the bears ample opportunity to jump on the bear train along it’s journey rather than being on board when it leaves the station.
Biotech, with my short positions
Iron Ore prices are collapsing on the back of icreasing output and declining demand due to a global slowdown in manufacturing.
There is NO way that the AUD or BRL for that matter are going to appreciate under this scenario, thus cause the AUD gold price to collapse.That is just insanity!
http://www.businessinsider.com.au/iron-ore-prices-are-still-falling-2015-10
The World economy is not a negative GDP nor is China’s. It is just that the fantastic growth of GDP has come off but World GDP is still growing as is World demand for Iron Ore. The big boys of Iron Ore mining are doing the same thing that the Arabs are doing to Crude: Keep on producing more, and more, so as to drive the price down to where the weak producers go out of business. But demand is not decreasing…it is increasing for both commodities.
Drop the Western biases: Both China and the entire World are evolving large Middle Classes.
You are both deluded and, frankly, ignorant.
The iron ore producers are akin to the U.S. frackers, digging til they go bust.
Nothing like the Saudis at all, who can sell it at 15 bucks and still be in profit.
As fir demand, yes, of course, it’s buzzing, hence the prices.
Get a grip Richard. Deep breathes.
Frackers have hedged so still making a little money. Saudi, whilst cost of production is in the single digits $, need $80+ to keep social programmes running. Sure, beheading people for a while will stave off dissent but they cannot afford a multi-year continuance in all probability……
J
Yes they can.
They have decades of surpluses carefully invested.
Junk bonds, leveraged loans and small caps divergent from large caps
We are in a very strange paradox here where global output for many industrial and energy commodities is increasing or level at the very least whilst global demand is in decline.
This is HUGELY, MASSIVELY, UNBELIEVABLY and consquently deflationary.
Huh? Why is it not the result of a growing World-wide Middle Class? Even though the American middle class is in decline the entire world is trying to become a middle class and that would be many, many, times the size of what the defunct American middle class was at its heights.
Richard, the last 2 decades has produced enough capacity to ensure that the middle class is catered for for at least the next decade.
Aside from that the issue at hand is debt. The world has reached debt saturation point.
Try as CBer’s may they can’t stimulate the global economy into further debt growth.
BTW do you really believe the GDP numbers?
Why do you think the way thet GDP was calculated was changed as recently as 2013?
We are NOWHERE near the nmbers in grwoth that they have us believe. Chinese growth would be lucky to be 2%. Just look at their declining energy consumption. That does occur in a economy growing at a purported 6.9% regardless if it is coming off of 8% or not, whch by the way was also total BS.
I’ll end by saying if you want to know the real story look at CAT,WMT and AXP. They don’t colour the truth.
This market is hooked on CB intervention and is totally disconnected from reality more than any market in history.
Thank you Allen. Very observant.
The market is just having a second chance rally, bugger all to do with central banks, who, I note, are all standing pat.
I saw a graph of the 8th year of a presidential cycle, which seems quite apt about how the market will crash next year. But I can’t find the link…can someone help? It should be instructive to all…
Oh I found it here…see how it shows negative returns for the 2nd term 4th year.
http://www.marketwatch.com/story/second-terms-impact-on-stock-market-2013-01-11
good to know. But with a sample size of only 4, it’s hard to give it statistical significance.
These markets have become the greatest scam in history. No doubt we begin via MSM to focus again on the FOMC meeting and IF the Fed will raise US rates.
Does anyone seriously think the Fed wil now raise rates?!!
Draghi sealed the fate of US rates today. Of course markets initially view it as a positive, but all the reactions to the upside on no rate increases in recent months have been swiftly followed by reversals back down.
Let’s see what happens?
Lol, I love this miraculous new world where you can see revenue decline substantially but manage to beat and impress.
Like I said….the greatest scam in history.
dax up almost 2% already today. Most powerful bull move I’ve seen in a while. I would think most bears would be wiped out by now. Get used to these rip your face off rallies as there will be plenty more in the coming bear market.
I assume you understand that a short squeeze simply means bears closing their shorts (by buying) as their stops are hit?
So why would you think bears would be wiped out?
Smells of squeeze to me, but what do I know…;)
J
Is 2060-2070 the new line in the sand.
Few sessions away from ATH’s? Fasten the belts.
No point being angry with the market, futile.
It is what it is.
Very powerful bounce back, although JH has a
valid point re divergences, UKX well ahead today though.
If the premise that markets have peaked and we are
indeed in an early stage bear market is correct, then
I would think we need to begin to head lower by next week.
China cuts.
Next round of Yuan devaluation approaching?.
I would not view that as market supportive,
however equities disagree atm.
Renewed support for gold?.
The ‘BIG’ question, in my mind, is whether today’s PBOC gifted push completes the 5th of the 5th wave from the 29th Sept low or are we still within the 3rd of the 5th?
Having put my emotions on check with a dose or 3 of Vallium (hence an objective judgement ) 🙂 I’m going to say we are in a 5th of a 5th, although on the micro count we could still reach 17700 before it all fizzles out.
Repeating another poster’s sentiment here….this is TIRESOME.
Please will the last bear hand themselves in to the Bull Police so that we can get on with the job of having a ‘recession’/’depression’.
There I said both the ‘r’ word and the ‘d’ word in one sentence.
You guys did know I was talking about the DJIA, didn’t you?
The wave 5 and the v:5 appears to have extended. It is still much smaller than wave 3, but it is out of proportion with wave 1. Provided this is an abc up from Aug. low, this IS a death pattern and it will end soon. Here is the crazy part I observed from years of watching these charts. When a trade is so obvious that a beginner can see it, that trade will have some kind of nonsense that makes it extremely difficult to get on board. And that non-sense will usually break the confidence of most that can see it is obvious. In other words, obvious trades ( like this one) seem to be protected by the chart gods. They never make it easy.
I mentioned a few days ago that the wave 5 would probably fail or extend to cause the greatest amount of confusion and “doubt” as possible. This one is breaking everyone’s confidence by extending. It could just as easily have failed and dropped out of sight leaving everyone at the station with their jaws hanging down. The “obvious” big pay trades are never easy to enter near the top.
When we look back in a week or so we may ponder at how easy it should have been to get on board at the station. But while in the chaos of a top, greed and fear, confidence and doubt, bat our emotions around like a tennis ball.
It seems to happen with every obvious trade, rather by design or fate.
Thanks again Nugget!
W
this sell off, although right on Q, is acting corrective so far. This is not promising behavior for bears short term. I still have my 7 remaining puts. Sold 8 at a profit but way under water on these.
Tempted to take some off with loss and reduce exposure.
We need to see impulse legs down rather than this mushy stuff down. One more leg to lower 2060’s should happen here. That could be an abc, or 123. The slow motion speed leans toward an abc at this time.
New post is out