Updated Charts

Hello again! And all the best to you for 2016. Markets moving closer to validation: the completion of a major top in equities, and the resurgence of gold. It has been a long and difficult 2 year major topping process in the stock market, but a topping process it indeed appears to have been. Here are the updated charts.

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OK, I have decided to revamp the site with a focus on the longer term and big global macro, as that is my ‘USP’. So be aware you might visit and see some construction work in progress. It will mean less frequent posts as the big picture doesn’t move so fast, but that suits me, and hopefully you will approve of the changes.

Charts Source: Stockcharts; Picture Source: National Geographic

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175 thoughts on “Updated Charts

    1. He could be correct if Delta’s S+P 500 I-3 is a low that brings in eighteen point Long term rotation L-7 higher than the August lows. It is possible that the August lows was a six point Long term rotation point 2 that brought in a low Super Long Term rotation point 7 almost to its 100% range (very early) which, if so, means that stocks will not only go to a new ATH but will rally for several more years and to much higher prices than is currently expected.

      And if the Energies are bottoming then the odds of this are rising. With the AO now negative the second half of winter will be very cold and opposite of the first half of winter which could help the Energies to bottom and rally.

      Of course this also means that the SC only crashed the Energies and not Stocks which is something that JH may have a problem with but must be kept on one’s mind until proved otherwise.

      1. Richard, you contradict yourself and your supposed strong “delta” xyz beliefs on a weekly basis. Please stop hogging up massive real estate on John’s site if you feel strongly about nothing.

        Happy New Year All

        1. John T, please may I gently remind you that it is STILL the season of ‘Good Will to ALL’. That must surely include Richard I.

          Also as has been pointed out many times before. If you spot a ‘name’ that you’d rather not read then you are welcome to pass it by.

          Hope you ‘get’ this gentle message.

        2. OMG!! I’m truly sorry to have changed your name to John, Joseph. Please accept my apologies for such a gross error.

        3. Joseph Teofilo: Given the new assumption that the Iranians will not be allowed to sell their Crude; do you know what it means, today, when the Feb, 2016, Globex Crude Oil futures had a Volume of 577,000 contracts on an Open Interest of only 337,000 contracts (only ten days remaining to expiration)?

          For me it means the multi-year decline of Crude ended today (or this week) –AND– the S+P 500/DOW stock indexes have ended their declines and will rally up to new ATHs with the top being in May just like it was in May, 2015.

  1. Congratulations on your brief sabbatical! I’m a perma-bear, so by constitution, always probe and/or maintain the short side, but when you suspended, I emotionally felt similar.

    Regards,

  2. Nice to have you back. And a longer term approach is fine by me – really tired of the “day-trading” bullshit on this blog, not to mention the ongoing discussions by the modern equivalent of the “flat earth society” (the climate change deniers).

    1. Haha I happen to think the same, except it is the global warming guys who are the “flat earth”. Don’t forget that it is the majority that think the world was flat.

      1. Most of the people living during the Dark Ages probably believed the earth was flat, if they gave it any thought at all, but the Flat Earth Society refers specifically to a handful of pseudo-scientists from a few hundred years ago who proposed flat earth theories in contradiction to the weight of the evidence at the time. Our planet doesn’t care what the majority thinks or doesn’t think. What does it matter, anyway, since there is no appetite for any kind of serious change in the way we live. Politicians sign empty, unenforceable treaties every few years and the overwhelming majority of climate scientists are ignored or reviled. So you’ve won – take a victory lap.

        1. I feel so sorry for those duped by the global warming industry.
          Do they not kjow how to use google, and do their own independent research?
          Gullible beyond belief, typical humans.

        2. Geez, Google you say? Why didn’t I think of that. Screw the scientists. And the “global warming industry?” I don’t know who or what you put in that category, but no doubt their money and power completely overwhelm the fossil fuel industry and the industrial civilization built on its shoulders. David and Goliath, all over again.

        3. jils,
          There is disinformation out there from both sides, of course.
          But the planet is billions of years old, has been through experiences far worse than a couple of hundred years of human industrial activity.
          It is the ultimate human conceit to imagine that WE can harm the planet, and most of the sheeple are being led by the nose by maxists who hate capitalism.
          We are a very stupid species indeed, one day the cosmos or the planet will wipe us from existence, no doubt saying ‘good riddance fools’.

  3. John, nice to have you back, and thanks for the post/charts. Was actually just thinking about you a couple days ago when Louise Yamada mentioned that the stock market has been in a distribution pattern for “at least a year and a half.”

  4. The SPX might test the 1901 area early Monday, but a very nice bounce is coming. The NYMO weekly chart below has been a great immediate term bottom indicator. Bottoms typically come after the NYMO breaches its lower bollinger band then makes a higher low while the SPX makes a lower low. In addition, there is quite a bit of positive divergence across a number of key indicators that I use, see the one up top. https://alphahorn.files.wordpress.com/2016/01/nymo-weekly.png?w=960

    1. Alphahorn, thanks for this post. PALS is in a rare all positive status until Wednesday: Moon phase, declination, and distance and seasonals. Thursday is Mercury inferior conjunction (MIC) which often a big selling day, and Friday day after is often big selling. So, I am thinking, stay long until about 2050 or Wednesday whichever comes first. Skip Thursday and Friday due to MIC.

      I have also noticed that market has 90% chance historically of rising from early January sell off until the third trading day of April, often by a lot. So I am thinking of going into a swing trade now at these levels with April 3,4,5 exit date (or earlier if price exceeds 2090 before then).

      1. Hi Valley,

        The big question will be Mercury tommorow will it be the low or next monday/tuesday with the bradley turningpoints if that is the case we can have a repeat August 24..
        Anyway I went short AEX today..

        Goodluck..

        1. A bit too early to be calling it a good call Gary/AH.
          As I type SPX is at 1915 and on the slide, maybe the bounce is over already, looks like a flag to me already.

  5. Good to have you back…. I was looking every day.. … anything or comments you ever have on Dow/ gold ratio…just thought you may want to do some charts on that at some pt.

    1. I am glad that you are back. I hope you used the time to peruse the Delta book. The Delta Intermediate “Inversion Window” (crash window) occurs ever four Lunar Months. This past August was a “crash” to the Intermediate one point of the Intermediate Inversion Window and this time (it is four Lunar Months latter) the S+P 500 is crashing to its Intermediate two point of the Intermediate Inversion Window.

      Last August the Intermediate one point was a low that brought in the eighteen point rotation Long Term point five and this current Intermediate Inversion Window point two may be bringing in eighteen point rotation Long Term point seven.

      This will give you an idea what Celestial Bodies can really do to markets in what is called Delta. In other words, don’t get too excited by the current “crash” in stocks as it may soon end, just like in August, and for the same reasons: both are in Delta’s Intermediate Inversion Windows (four Lunar months apart) and going down to the eighteen point rotation points (point five in August and point seven now) that bottomed and turned the markets back up.

  6. John,

    Welcome back. Love that your veering toward your “USP.” That ought to make what is already an interesting read even more interesting… AND helpful.

    Saw a study recently that observed when the ISM and PPI fall in unison the probability of a recession increases. The correlation to recession is quite high… something you may be interested in taking a closer look at. Many observers focus instead on rates. But what if the pricing mechanism is busted with the advent of QE & ZIRP? With the Solar Cycle steadily advancing into minimum territory does this dysfunction make the “stupider” seem “stupider”? (Referring to your comment about investors being at the whim of the cycle rather than being an intelligent decision maker).

    Also bookmarked two helpful data sites… you probably have them in queue already…

    http://www.macrotrends.net/

    https://ycharts.com/indicators/non_manufacturing_index

    All the best,

    HVA

    1. All eyes should be on the Three “C”s that the Solar Cycle crashed because it looks like the crash effect from the Solar Cycle has ended and Bull Markets are beginning: Canadian Dollar, Copper, and Crude.

        1. Are the three Commodity/Dollar currencies turning back up in Bull Markets: Canadian Dollar, Australian Dollar, and the New Zealand Dollar?

          The CRB index is heavily energy weighted and other commodity indexes have already bottomed and turned back up so it stands to reason to watch these commodity currencies for confirmation of commodities bottoming and turning back up in bull markets.

        2. In addition to the three “dollar” commodity currencies for clues and hints that the Bear Market in Commodities has ended and a Bull Market is beginning so, too, should the Brazilian Real be considered right along with them.

  7. Happy New Year John! Good to see you here again. Less frequent posts are a good idea (he says, speaking selfishly 🙂 as it’s great to know you’ll be posting here regularly, even if not as often. Wishing you and yours all the best for 2016 and beyond!

  8. Just FYI, I am out of the USO short positions – closed at 933. Slight draw at Cushing today, may result in a bounce on Wednesday if they get the number wrong. Happy with that.

    J

  9. Welcome back John. Hope everyone is well?

    Yes to those anticipating a bounce. Way too bearish way too quickly. I suspect we need a bit more swinging before wiping out. Back to test the bottom of the dome perhaps?
    Top definitely in though. Aussie gold stocks performing once again.

    1. Welcome back John, also welcome back Allan.
      Everyone looks….different.
      Nearly back home, no more trading for me, instead a Brent Cook subscription and some gold explorers. A few 10-20 baggers would be fine and dandy.
      Also, totally off – topic, RIP David Bowie, the most innovative and talented musician of his generation, a sad loss.

    1. GM, hey buddy. Agree on both points. Ziggy was a legend. The man behind the persona was a genius. Soxtynine is on the low side these days but he lived a hard life in his early years. I suspect that maybe had an impact.
      ASX listed SBM….what a performer that has been! From .075 to an intraday high yesterday of 1.72!!!……..wooohoo 🙂

      AH, great chart. Agree 2100 test likely.

      Cheers

    2. Well, I for one, am pulling for you…
      I’m back to being long some PM stocks, and some oil stocks, as well as oil…
      Hopefully higher oil prices will be the reason for the stock market rally…
      I call it my “Force Multiplier” effect… 🙂

      Otherwise, we’ll just call it my “Lose money even FASTER” strategy… LOL

    3. This chart looks contradictory to your SC1 SC2 wave chart that youve frequently posted. A wave 5 run still to come according to this chart would contradict an impending top based on your sc1 / sc2 wave chart

  10. Welcome back Mr. Hampson!

    geno0010 says:
    January 8, 2016 at 3:23 pm
    All my info is pointing to a low on Monday, January 11th. If we could drop down to 1905 that would be perfect!

    Geno is obviously long now. We usually get 100 pt rally out of these lows in short time.

  11. I closed another 30% of my puts this afternoon and 35% of my individual stock shorts on selected US companies. Also picked up some 2075 Feb calls. Still long gold and soybeans (the latter slightly underwater).

    J

  12. In my most humble opinion, the most important market today, and this week, is GCLG16 also known as the NYMEX/GLOBEX Feb, 2016, Crude Oil futures. There is no market anywhere on Earth more important than this one –this week. Today, with only ten days left to expiration, its Volume was over 170% of its Open Interest. This is extremely unusual and rare in the futures markets. It usually portents the end of a major trend which, in this case, is a Bear trend.

    Today’s ending Open Interest will be extremely important as will the Open Interest in days after this Wednesday’s liquid fuels storage report and this Friday’s Rig Count report.

    Delta’s Intermediate 2 point is a crash point slightly less powerful than the 1 point. I think that both the S+P 500/DOW Intermediate 2 point will come in on the same day as the Heating Oil/Crude Oil Intermediate 2 point this week and most likely today, Monday, Jan 11, 2016. Note that four Lunar Months ago the crash point low of August, 2015, was the S+P 500/DOW Delta Intermediate 1 point (coming in with the six point rotation Long Term 2 point which is also a crash point).

      1. If ever Posters on this Blog want to complain about HFT then they should complain about what most likely happen in WTI futures today as volume was over 170% of open interest with a mere ten days left of the Feb, 2016, futures. But oddly, I don’t hear anyone saying anything but me.

  13. O.K. lets get to the near term truth about why the markets cratered so hard Wednesday thru Friday of last week. Delta does have it’s unique dynamics but I am not refereeing to it. I mean the fundamentals without any type of Wave Counts.

    The markets acted like the American Consumer just dropped to his knees. Huh??? Yea, that’s right. But where did the markets get the notion that the American Consumer dropped to his knees immediately after Xmas? That’s the rub. Where did all the pension fund managers get that notion and in unison?

    Answer: Last Wednesday’s American federal government’s weekly liquid fuels storage report. What do you mean? I mean the fact that even though USA Crude Oil production was reported as a decline, as it has been for weeks, and that the storage of Crude Oil declined too, as it also has been for weeks, the Gasoline storage had an unexpected large increase. It was the Gasoline storage increase that sent the markets, both stocks and Crude Oil futures, into a tail spin.

    The pension fund managers are school boys who are not “educated” but highly “schooled upon”. They interpreted, in unison, that the unexpected increase in Gasoline storage was because the Consumer fell to his knees immediately after Xmas. He did not.

    The Consumers of the “fly over states” use the greatest per capita amounts of Gasoline due to the large distances they must personal drive every day. They were hit by Winter Storms that shocked them into driving much less –for a short while. They have most likely recovered and might be using more than average amounts of Gasoline due to rougher than normal driving conditions and due to idling their vehicles for unusual time amounts in order to warm the vehicles before proceeding. This is most likely in-the-near-term “why” Gasoline storage increased so unexpectively and not because the Consumer, coast-to-coast and border-to-border, just dropped to his knees –shortly after Xmas.

    If so, then this Wednesday’s report could or will result in a “Bear Trap” of the Crude Oil futures market and show that the multi-year Bear Market is over. It also means the sell-off in stocks was way over done.

    1. Richard, you stun me again and again with your wild imagination and wacky theories.
      This one (I think) is the best yet, well done, gave me a chuckle.
      I’ll be counting the days for a 180 degree revision of your view.

      Your wrote above: ‘Given the new assumption that the Iranians will not be allowed to sell their Crude’.
      You have any evidence (at all) to back up this one? (And I don’t mean a Bloomberg or Yahoo finance speculative piece).

    2. This oil bear market isn’t even 2 years old. At least the good part did not start until then. Per normal long term cycles, the bear market in oil will not be over until the late 2020’s. Couple of good rallies and a geopolitical splke, but bear mkt.

  14. You are going to see oil in the teens before that happens. We are in Deflation mode and its
    only just the start of it. Even Gold may get a touch up but I would rather own some as a form of security then owning shares at the moment. BHP is a classic. This is all about to get very ugly. Europe is a powder keg about to go off.

        1. I believe that the Canary in the Coal Mine is China. It is impossible for them to do CPR on that canary, given the debt overhang.

  15. Richard Isaacson

    I just want to clarify a couple of things in your statement re gasoline above. There was a 4.6% build of gasoline at NYH last week, certainly nothing out of the ordinary there. On the Diesel side there was a 12+% build which is substantial and not so ordinary, but not extreme. How do these facts play into the scenario you are talking about with certainty? There will be a report in about 6 hours on NYH this week, before the release from EIA on PADD1B tomorrow. I shall be looking with interest. Remember though, NYH is the physical loading point for the Nymex contracts, PADD1B is what the EIA release numbers on, NYH is only a subset of 1B…so these do not correlate that welll…..

    Secondly, which “multi-year” bear market are you talking about? in Crude? It’s been about 2 years since Crude made a new high, but you make it sound like a lot more than that? Why?

    I think you have to be careful when creating scenarios with such certainty, especially when the facts are not there to back them up. I am not saying you are wrong, and thanks for sharing your thoughts.

    My own take on Crude as stated over the past few weeks is that unless there is a substantial pick up in demand we will see lower prices, unless the USD becomes substantially weaker. Everyone who can are storing and selling forward, the contango situation is getting more extreme but not to the extent is has been in the past – we could see “hypercontango” – from memory this occurred in the 90’s some time, I would have to check.

    I would be very careful with Crude and Energy stocks for the next quarter or two, I have entered some initial position very small in long term investments, but if you are looking to trade it I would be very wary. There will be rallies of course, just be careful.

    imho
    J

    1. Thanks for the post. I am aware of the fundamentals that you allude to. I write the way I do because I am dropping hints to people like Allan that I am expecting the Energies and Canadian Dollar to be making Delta low Super Long Term points.

    2. And BTW, did you notice the decline in the Feb, 2016, Crude Oil futures open interest by 50k? Given yesterday’s amazing volume, the decline in open interest, with only 9 days left on the futures, (for Allan and others benefit) with my experience in futures “tells” me that a Delta low Super Long Term point is coming in for the energies and probably already has for NG. (This is also extremely important for major stock indexes due to their energy sectors that narrow minded stock traders are most likely ignorant of.)

      1. Hey RI

        Well, there will be increasing open interest in my view due to the storage economics. It would seem likely to me that as companies are (and have been for some time) selling forward in a contango market that an increasing quantity of expiring futures will result in physical delivery/EFP. I have seen what you highlight but do not see the point in making a prediction in terms of a hypothetical case. I work largely on price, so if the “energies” break out I will likely trade it, although at the current time they are 10+% from a breakout depending on where you draw the trendlines. A bit early for me, as I am still bearish crude oil in the short to medium term.

        In the longer term, I do feel that energy/commod stocks will fly and of course depending on the state of the wider SM at that time (whatever it is) could be a very good trade. At the moment though, unless we get above 40usd on WTI and hold it, I don’t see energy stocks rallying enough to give us a new ATH for example. Certainly, there would have to be a LOT of money flowing into other sectors without them.

        I will just watch and wait, there are too many factors involved (imho) to make a case for committing actual funds to a trade on “energies” at this stage for me. Although you never know what has now been priced in, some fund managers are going to look at the current yield at some point and who knows..:)

        all imho
        J

  16. Just FYI, I went long QQQ at 104.7 – small position as it seems to have broken out of the recent downtrend. Fairly tight stop.

    GLA
    J

  17. The Delta turn in the S+P 500/DOW is in and they are rallying back up to a new ATH that will most likely top out with Delta’s Medium One point as a high just like what happened in May, 2015, and I now expect to happen again in May of this year with L-8 wherein it was L-4 in May, 2015. The current low L-7 is not going to be lower than the L-5 of August, 2015, which means the Long Term trend is still most powerful up.

    This also means that I think that six point rotation L-3 (which is due this very month of January) did not come in with eighteen point rotation L-6 but will come in with M-1 and L-8 in May AND WILL ASLO BRING IN SUPER LONG TERM POINT 6. This means the odds of a “crash” to low SL-7 isn’t very likely with such a late high L-3 and SL-6 which implies that the trend of the 19 year 5 hour Delta Cycle will conclude, as usual, with the Super Long Term point 14 as the high in 2025 (just like in 1929 and 1987) before the Super Long Term Inversion Window crash (just like in 1929-1931, and two months in 1987, and from 2007 to 2009).

    I am sorry folks but Delta is implying that the Solar Cycle will not crash the S+P 500/DOW as expected/predicted unless you want to qualify the crash to August, 2015, as the Solar Cycle’s stock crash. Otherwise, the Solar Cycle crashed the Energies (and Canadian Dollar) this time around.

    1. Wait…you said it was going to crash? What changed in Delta that you couldn’t have seen 1 month ago, because as I understand it, Delta is using the moon and the cycle of the moon is known years in advance!

      1. Delta is not the total interaction of the Sun, Moon, and Earth like it advertises to be. It is a stripped down version of the interaction of the Sun, Moon, and Earth which is why so many make mistakes using it and get financially whipped out.

        We are at a very crucial point of Delta that was not fore seeable one month ago: Price. Delta is strong with Time but weak with Price. Also, it was not fore seeable which Intermediate Point would bring in low M-9 with L-7 and, therefor, whether or not low L-7 would exceed low L-5 which is the crucial part of when the higher rotation points are coming in –and– what the greater trend is.

        For the crash scenario L-7 must exceed L-5 of last August and if it doesn’t then the crash scenario is wrong and a continued Bull Market is correct. This was not knowable in advance because it was not knowable which Intermediate Inversion Window point would bring it in.

        Delta One points are the most powerful of any points including its fellow Inversion Window “crash” points. Delta Two points are weaker “crash” points than the One points. It was an Intermediate One point that helped to bring in low L-5 last August and it would have taken the recent Intermediate One point or an Inbetween Point to help L-7 exceed L-5 but that hasn’t happened as the weaker Intermediate Two point looks to have brought in L-7 (of course) higher than L-5. With L-7 higher than L-5 means that the six point rotation L-3 did not come in with L-6 but will most likely come in with L-8 as a new ATH and that implies that SL-6 did not come in with M-1 and L-4 last May but will be coming in this May with L-3 and L-8 and possible M-1 too.

        Now you may understand why most who use Delta get financially whipped out. Delta is not the total interaction of the Earth, Sun, and Moon like it claims. Delta is a limited interaction of the Earth, Sun, and Moon and is opposite of Elliot. None-the-less, both are “wave” counting systems and not “cycles” even though Delta is based on a 19 year 5 hour tidal cycle.

    2. Delta, what a waste. You can make it fit after the fact. I followed the Delta Gold report and a service from Wilder. I respect Wilder but no great shakes for Delta service. The market is due to bottom in Jan with a standard deviation of 6 months either way. I am exaggerating but not much.

  18. “I am sorry folks” – well, don’t be. I think most on here make money in both directions. If we can clear the 1940-50 area SPX, we should go to 2k I would have thought…..price does seem to be dallying around though…..

    J

  19. HUI was hammered yesterday…weird, any ideas why?
    Sterling crumbling versus the USD, watch out if 1.40 goes, huge head ‘n’ shoulders pattern targets 0.7 from memory.
    So tempting to take more short positions if we push up this week. Maybe gold explorers can wait a week or two!

    1. I am really pissed off with gold. It is one of those things that I stop out, and it still doesn’t go up. My stops are usually loss making! I wonder if gold is a buy AFTER the crash and not during, like gold miners in 2008.

  20. Hey GM

    Welcome back. I was stopped at 14.67 a while back on HUI, gold is down quite a bit after the recent bounce.

    Remember to take some profits once in a while won’t you?:)

    J

    1. Hello jeger.
      I don’t have any gold miner positions, and when I do (soon) they will be holdings for many years.
      I was just curious as to why the sector was hammered yesterday (and again today) whilst the gold price itself is holding up quite well.
      As for physical gold itself, that’s a holding for c. 40 years, if I am lucky!

    1. Today…so far…..down….copper (o.7%), oil (3%) and the CAD (0.4% v USD)
      Hope everyone sold Richard’s predictions. Our very own Goldman Sachs.

  21. Richard – IMHO you could not be more mistaken. I love your “sorry folks” comment, as if your predictions have already occurred. Let’s catch up in mid-march and share notes……

  22. I’m considering writing a book, on how to lose 10% of your investment in 24 hours…

    Step 1: Buy precious metals stocks

    Step 2: Wait 24 hours…

    It’s a short book… :-/

  23. And as noted previously, I ~am~ looking for a bounce higher in the oil market…

    It just checks all the boxes for me…
    Very bearish sentiment – check
    Calls for even lower prices – check
    Below my SA-RSI bottom envelope – check
    Money flow going HIGHER, for weeks now – check
    Feeling sick about being long – check

    So yes, looks like it’s gonna be a bottom very soon here…

    That said, been losing MANY thousands in oil these past few days, but in reality, it’s small compared to the dislocations the current price is causing to the oil industry…
    A few of my friends work in that industry, and the writing is (literally) on the wall for them…
    A few $$$ is not much compared to losing your 6-figure job…. This is getting ugly…

  24. It is very strange. In the past, when SPX is down -1%, all the bears cheer. Now we can be down -2% and down for several days on NDX, and there are few cheers. Are bears being left behind, and if so, would this fuel more downside as everyone gets short (or longs get out)?

    1. ~Looks~ like a bottom setting up, and traders trade….
      I have no doubt that all of us that trade, will be eager to re-short at higher prices….

      So yes, there would be much less joy if the market continued much lower, but, you gotta trade what you see, and feelings of left behind aren’t really a factor in the decision process….
      I see higher, but that said, price itself is currently not having any part of that… :-/

      I’m sure there are many bears that still have their positions, and are very happy, just not vocal about it….

  25. AND, they just now added a dedicated WTI ticker to the screen on CNBC…
    It’s now a “stickie”….

    The LAST time they did that, was at $140 oil…..as it was on it’s way to $200… 😉

    Priceless….. 🙂

  26. I don’t think people cheer so much on here – it is a more seasoned forum. If you would like an update on how it is going though, I am happy to give it. 😀

    Look at IBB today, up almost 3% earlier now down almost 1%. I got stopped for a modest profit on QQQ earlier. Still short Amgen, an airline or two, half my gold longs hit limit the rest are still there now mildly underwater, still long Soybeans, short UPS, still have some Feb 1730 puts as well as a selectionof some OTM calls – 2060,2080,2120 Feb/Mar.

    GDX gapped down today, I want to get back in but will wait and see.

    By the way, I would recommend having a look at airlines sector. Confirmed downtrend even whilst oil is so cheap…..wonder what is going to happen when oil does rally??

    GLA
    J

    1. Thanks Jegger and Barry. I was talking about other forums, not this one. This is the most decent bunch I have known!

      As for me, I had an open order to short THRX this morning, but I didn’t realize it was rejected due to the symbol change to INVA. It is down -14% and I missed it!

    1. I put on a small hedge this morning with the weekly 203 puts on SPY – took that hedge off now for 18% gain and sticking with my SPY calls. Could just be a wave 4 ended this morning and down we go to new lows. I’ll be a buyer of new lows if that happens.

  27. If this is even a short term cycle bttm, then things have changed dramatically from cycle bttms of the past 7 years.
    There is almost zero momentum out of this low and intraday charts are behaving totally differently to what they have in previous bttms.
    That says to me that we are either going to make lower lows this move OR this next move higher will lack momentum to make higher highs and thus cement the bear market for good.

  28. Given how the American stock market seems to have its eye on Crude futures let’s look at what could be happening in Crude Futures.

    After yesterday’s lows Feb, 2016, Crude futures rallied up to $31 and thrice found resistance until it broke thru. Then, it fell back and found support at $31. This may be the pattern as it rallies. What was resistance then becomes support is also an old trading adage. If this becomes the pattern in a Crude rally then not only can Day Traders make out like Bandits in Crude futures but so can Day Traders in Stocks given how Stocks seem to trade in lock step with Crude futures currently.

  29. Hi, much as I like the new site’s look and feel, my 2 brain cells need some help here please.

    John H has got another post marked Latest Stock Market charts on the ‘Home’ page. I am (was) expecting the day to day comments to be made there. However it would appear that they are continuing to be made here….and some there.

    Does anyone have a clear idea of how the new system should work? I used to like the idea of John H marking the end of a post by declaring ‘New post is out’. Both my brain cells would very much welcome that clear ‘direction’. Thanks

  30. The Chinese imports of Crude is at their highest ever. The trend is still up. Why is this important? Because with USA crude builds no longer increasing or even falling the threat of losing “market share” has been removed. OPEC can now decrease production without the Fear of losing market share because China’s imports needs just keep increasing and are not declining with their stocks declining. OPEC and others are safe to decrease production without the “fear” of losing market share and probably will soon. Crude’s lows are probably in especially if the USD starts declining.

    America’s decrease in demand for distillates is due to the weather and not the Consumer dropping to his knees.

    1. With the Chinese Crude numbers “market share” is no longer on OPEC’s table. The only issue on OPEC’s table is Price and OPEC is experienced in how to get price up.

      1. OPEC can’t overcome a deflationary collapse and this is the mother and father of all deflationary collapses.
        YASNY!!!…………..$10 crude is a comin. Dr Copper headed for $1. Chinese markets are still way overvalued even after a 40% collapse. Global debt levels at astronomical levels and US markets behaving with increasingly bearish signals week after week.

        On tne opposite side the only asset class that is showing ANY positive signals is good old precious metals

        1. If World Stocks go up, Market Share as the Narrative of Crude will be in the past. If Chinese Stocks go up, Market Share as the Narrative of Crude will be ancient history.

  31. I’ve now read through all the comments on this thread and as usual there is a ton of ‘GOOD STUFF’ here.

    I was ‘tickled’ by Barry’s ‘little book’!! I have a number of personal versions of it for both the Stock Market and the Currencies. Lucky for me both my brain cells love humour.

  32. Not sure where all these figures are coming from. I don’t see any signs of oil demand globally increasing…….the main thing for me is as mentioned what the USD is going to do. The oil market is oversupplied by around 3-4 million bpd, the forecast for US is a 900k-1.02m drop in production by end of 2016, thats not even going to cover Irani barrels (officially) coming to market. The OPEC points is a bit of a catch 22. At these price levels, the budgets of Saudi, Russia and most of OPEC look like manure – do you cut production and sell even less? Difficult to call that one….imho…

    Just gone long GDX with a tight stop, expect to get stopped because I suspect that the next move will be quite dramatic, and cant rule out going to something under 12…….imho

    J

  33. Given today’s swoon in the DJIA (at 16410 at time of writing) who here believes that it will in the next few days be at 16700? That’s a rhetorical question by the way.

    At the moment I’m struggling to upload charts anywhere. (Restrictions imposed by a paranoiac 3rd world govt). However from Friday’s low I’m looking at an ‘Expanding Diagonal’ which is just completing it’s wave ‘b’ of 5….in EW terms. That implies we head back up in ‘halting’ fashion towards 16700 and collapse back again towards the Friday lows.

    Any way that’s how I’m trading this. Although my trades will only be intraday.

    1. P.S. Like all good EW counts the alternative is that it continues to head down towards 16200 before bouncing. Right now at 16394 it’s broken the lower trend line….hence this alternative count comes into play.

      1. I believe the manner the Nikkei fell early 1990 is particularly instructive. These two day rallies, like those in 1990, give bears little room to reenter there shorts and give bulls who pick bottoms little profits. The dollar cost averaging would typically be a resistance in the two day rally.

        1. John Li, I wasn’t involved in the markets at the time. I’ll need to look up those charts although without a ‘small time frame’ perspective I find it difficult to compare.

  34. Hi Purvez

    Yes, I don’t trade the Dow too much, but if b is done, looking at 2006-10 on SPX imho, although I am far from a proficient wave counter….:)

    Picked up a few 2050 Feb calls just now.

    GLA
    J

    1. Jeger, you need to understand that I look at 5 minute charts so my perspective is myopic at BEST. (is there such a word as nanopic?…coz I often get there too!!).

      At time of writing it is still heading south though.

  35. Good trading – Bad trading…

    Well, interesting morning, that’s for sure…. Market cannot seem to hold a bid….at all…
    I was fortunate to add the first layer of some new shorts early this AM, in TZA, so that’s helping me a LOT today, but ~if~ the move to 1950 was all the rally we’re going to get, it’ll be a very disappointing scenario for me…

    Still looks like a rally is trying to setup here, both in stocks and oil, but have to say, the last two days of opening higher, and then eroding quickly thereafter, is concerning…

    Regardless, I’m back to about a 10% net long position, the longs all being oil-related positions…
    Not saying this has to be ~the~ bottom in oil, but am looking for a pretty decent bounce from around here…

  36. In terms of SPX I might be looking to go long around here with a stop below the low of yesterday at 1905.xx. Don’t get me wrong, overall I am bearish at present, but prices don’t go in a straight line and I have a target of 2005-2010 which would be worth trading imho. I have a number of Feb calls though, so just deciding what level of exposure I want. I am pretty sure we will revisit 1850 at some point in the next month, and perhaps a bit beyond that to 1700-1750 in the coming several weeks but I have to trade what I see, and at this stage I have a place to put stops (in my opinion).

    As I am looking at 60 min charts, I will at least wait for next candle…..

    GLA
    J

  37. OK, so decided to see if I can catch a knife, long SPX at 1905.43 with a tight 10 point stop. I am so short anyway, might as well see if this turns into a hedge….:D

    J

  38. I think the patterns are pretty clear here and is unfolding exactly as John amd myself have been saying for months.
    Markets down, dollar down, gold up. That is clearly the pattern that is evident on a daily basis and whilst moves as such have been subdue, expect those moves to become far greater as we progress.

    I said it 18 months ago and will say it again. This is not 2008 and the dollar will not be a safe haven as it was then. The reason is that the US Fed have exhausted all options to stave off a major crisis and as such all currencies will implode, including the USD.

    The USD has been in a clear MAJOR bear market since topping out over two decades ago at 165.

    1. Trust me, the move in gold and silver will make the move from 2008 to 2011 look like a blip. Aussie Ag/Ag stocks. The quintessential barrometer for the metals are telling the whole story!…..NO ifs ands or buts!!

    1. Jeger, wow that’s seriously brave of you. My ‘limited’ experience is that when a market has fallen and can’t ‘get off the mat’ then it’s in SERIOUS TROUBLE.

      1. Well, it is not brave, as I said I am seriously short already so in all honesty for every point SPX drops my profit goes up 3.7 (equivalent).

        Let’s see where we go, if 1900 isn’t retaken by close I might reconsider.

        J

  39. OK, I added at 1889 – and will now stop updating the micro-management of this one . I know many of you are not interested in short term trading:)

    GLA
    J

  40. Shorts from this morning have been covered…
    Suppose I’m betting this time ~isn’t~ different, but there we are….

    Again, looking to re-short at higher prices, and will be saying my prayers tonight that we get there….

    Putting on my “Nicolas Rally Cap” right now…. hahaha 🙂

  41. Do we have a ‘talking heads’ version of ‘WHY’ today’s drop occurred? I’ve been busy elsewhere hence the question. Much as I’m enjoying the ride down it would be nice to have a break before my feet end up in my groin area.

  42. John H, in keeping with your focus on the longer term….have you considered how deep this could go before it finally ends? A post on the different possibilities, in your inimitable style, would be very welcome at this stage please.

    Thanks.

    1. p, if you go back through the archives you will see that John has said before that he expects at minimum 30% and likely much more.

      1. Thx Allan, now that you mention it I do remember those targets. However I’m hoping John H will pull together previous data and present it in his quite unique style to provide us with a firmer basis on which to evaluate those targets.

  43. As most here know. I’m currently here with my mum who turned 90 on Xmas day.

    Today as the US market was opening she decided to have a reminiscence session with me. I could see out of the corner of my eye various points where I would have taken short positions….but I need full concentrations for trades.

    Cost of foregone trades…. as it turns out approx 300 points.

    Reminiscing with mum….PRICELESS!!

    (sadly Mastercard refuses to fund my trades though!!)

    Some choices thankfully are super easy.

      1. Thanks jeger, that’s exactly what I’m doing. Will be heading back on Sunday after having spent a very very nice month with mum and aunt.

        1. Purvez – There are always opportunities to trade the markets, never enough opportunities to spend time with loved ones.

  44. I started this day warning that so goes Crude so goes Stocks. By my calculations I have the S+P 500 Delta Intermediate 2 point due this past Monday and Heating Oil’s Intermediate 2 point due Thursday. Both are Crash Points. I have already posted that I am expecting both to come in together and to favor Heating Oil to drag the S+P 500 late. In fact, due to “weeklies” the low close for both might just be Friday which is only a stretch for the S+P 500 but not for Heating Oil/Crude and the panic selling of stocks go into overdrive with the possibility of the L-7 closing low being lower than the L-5 closing low of last August thereby pointing towards a crash scenario after all.

    It is possible that I have the six point Long Term Rotation wrong in that an early L-2 came in with M-1 in May and brought in SL-6 so that the low I-2, M-9, and L-7, are going to bring in L-3 as a low, instead of a high, which means it will exceed the August L-5 lows. One of the problems is that both L-3 and L-7 are due in January and with both opposite it presents problems but with both as lows it argues that both are coming in together and that means exceeding the August L-5 low on a closing basis.

    1. L-O L-O L-O, Richard still typing things, as markets, oil and the CAD decline further.
      Love it, also the Alphahorn bounce eh, great call indeed.
      Well done to jeger, holding firm and short seems to be the approach.

      1. It’s a bit easier when holding a bunch of stocks whose sectors are in a confirmed downtrend, the airlines have worked out very well indeed and if oil does bounce for a bit who knows where that could go. I just added some Potash longs for a longer term play, the divi is great and price appreciation prospects look pretty good too.

        imho
        J

  45. Lots of sky is falling rhetoric, I see things as right on schedule, a perfect touch of the lower trend line for intermediate wave (C) of primary wave [4]s large triangle. now if that lower trend line falls tomorrow, then I’ll join the bear part, but I don’t think that will happen

    1. Alpha

      I think we are all looking at that one in the larger sense, I wonder if we need a snap back rally for a few days so that we tag the support a bit further along to avoid violating the 1820 area and thus breaking the larger bull…..? There are early signs of positive divergence on the SPX versus RSI, but those can go on for weeks or even months of course.

      J

  46. I have been doing so rethink on different market Deltas. It is very rare for two Delta “1”s to come in together and when they do the moves are radical. It has never been known for three Delta “1”s to come in together. So what if the Euro high I-1 brought in a high L-1? This would help to explain the radical up move on Dec 3. Because it is very rare for two 1s to come in together I have not been considering this possible rotation solution. This would also mean that the Euro’s L-2 will be a low and because it the second most powerful Inversion Window it can be a very deep low. Ironically, this does fit with what I have consistently said about Gold in that Gold will not stop going down until its L-3 as a low.

    But that isn’t all. Morgan Stanley is calling for the Dollar to go higher and for Crude to drop to $20/barrel. This Euro Delta rotation solution would agree with them. And if Crude goes lower then so will US stocks. And all that points to last May in that a high M-1 brought in L-4, L-2, and SL-6 exactly on SL-6s average due date. The L-2 was early and is a crash point of the second most powerful Inversion Window. It is because it came in early that SL-6 did not come in early in 2014 with the Solar Cycle top.

    Given the above as the correct Delta rotation solutions then the S+P 500 most likely made a low “replacement” Intermediate Inbetween Point for I-2 and I-2 is a quick high that has already come in and the S+P 500 is crashing on down to low I-3, M-9, L-7, and L-3, which will greatly exceed the August, 2015, lows.

    1. There was a recent example of a market making a “replacement” Intermediate Inbetween point for a low I-2 and then the high I-2 coming in quickly and a “crash” to a low I-3: Cocoa futures. For the Delta Intermediate rotation the S+P 500/DOW may be doing the exact same thing.

      The Euro crashing to a low L-2 will send the US Dollar index up sharply which would fulfill Morgan Stanley’s reason for a crash in Crude Oil to $20/barrel and the Weather may fulfill other’s predictions that Crude will fall to $10/barrel. With “so goes Crude so goes Stocks” in play would Crude falling to one third of current prices equate to stocks also falling to one third of current prices too?

      There are predictions that a SSW (sudden stratospheric warming) will occur late January that will give rise to a T-S-T (tri-pole) pattern that will be slightly offset. Also a negative NAO (north Atlantic oscillation) that is offset to the west. This means an elongated Polar Vortex that feeds cold Siberian air straight across the North Pole and into the middle of the USA while that Ridge over Iceland is shifted to the West and slightly over the Eastern USA. Most Heating Oil demand is along the east coast of the USA. This weather pattern means reduced Gasoline demand in the “fly over states” with reduced Heating Oil demand along the east coast. Crude’s main distillates are Gasoline and Heating Oil/Diesel Fuel. This week’s and last week’s liquid fuels storage reports saw builds in Gasoline and Heating Oil that the predicted weather pattern will cause to continue to be the norm thru the winter. Thus, the weather may assist Crude in falling to one third of current prices.

      Add in a negative quarter GDP, just like the last two winters, and stocks could be crashing thru the Winter.

  47. The chart patterns are ugly, starting with 3 lower tops and bottoms. Once the second low was taken out, the writing was on the wall, so to speak. It looks like the pattern requires a more complex finish and hence further downside.

    Are there any positives ? Maybe.

    Jan 14 1991 was a bear low for SPX as 1st Gulf War was about to get going. That’s 25 years ago almost to the day so far.

    Jan 18 (and then the next 2-3 weeks) in 1966 was a bull top after 34 years up. That’s 50 years ago.

    That led to a 16-17 year sideways market.

    So we are 25 & 50 years from major turns almost to the day.

    I like those periods since in Australia we had a major bear low on Jul 8 1982 exactly 50 years after the Jul 8 1932 bear low of the great Depression.

    Monday is a holiday in the US but I have a little number for the Aussie market that may help in any trade.

    The SPI (Aussie share price index future) topped in 1987 at 2368.

    It made a low on Jan 16 & 17 1991 at 1184. Yes exactly half, exactly 25 years ago.

    It then topped out in 1994 at 2368 once again. Yes, it doubled.

    Overnight futures here on Friday night closed at 4745.

    That’s just 9 points above 2X2368 or 4X1184 or 4736.

    If we get a low +/- 2 pts of 4736 I reckon its a buy with a near stop.

  48. Big John, happy new year and welcome back Love the new look, and data still great. I visited site to find your email to say don’ t miss out on this! I should have known you wouldn’t. The market has a propensity to make one scream uncle before it does what it is “suppose” to.

      1. I fully agree, Kent!
        John, excellent to have you back and ‘the long view’ looks to be the most useful in these crazy, stretched-elastic, market conditions.

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