Daily Archives: August 8, 2018

VIX Daily Chart: VIX Bear Trap Review!

The amount of time the VIX has been correcting just about puts it into an Intermediate degree position. It’s still a VIX bear trap any which way you want to look at it, as it is only a matter of time before the fear gauge starts to crank up again. The Death Cross finished about a month ago but the Golden Cross will still happen. The commercials are net long while those hedge funds or speculators are betting with net short positions. One group is always wrong and it sure isn’t the commercials. Combine that with a wedge and you have a deadly chance of the VIX exploding to new record highs by the end of this year.

Fear is going to come back regardless, after which the commercials will be turn net short again. Deflation is the main threat as we come of the most inflated asset world in history.  Another quick flash to the downside can still happen, so we have to be aware of that.

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DJIA Weekly Chart 2009-2018 Review

By any metric you want to use this inflationary world is going to come crashing down and investors have no clue that it’s about to start happening this year. I have many in-house indicators as well that nobody gets to see except for, one on one clients, that have paid me some sort of consulting fees. There are no real limits to consulting fees, if your good.  I would be crazy to give out any investment advice, as it is clear to me that investors always get burned. 2015-2016 saw a nice correction which was the 4th wave in Intermediate degree. Any large degree 4th wave is also a warning that one more bullish phase is coming but that will also be the last chance for stocks bulls to make any money. The majority never win at this game as they always go down with the ship made out of paper!

At this time I can already see that the gold sector and the stock sectors are going to sync up, and it should be more obvious by the end of this year around the November 21st

date. This is a best guess scenerio, but if it comes close, then the DJIA will also rally with gold for the entire bearish counter rally to come in 2019. If the DJIA comes to a rest at the 15,000 price level it would only be on a temporary basis at best, lasting into 2019.

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October Crude Oil Update

This is the October contract and they all have different patterns for this 2018 top. Oil takes alot more work to get a decent position at this top, escpecially in trading the little Forex oil units. I have been short crude oil with real money for many months already and most of the time the short trade was in the green, except for the beginning. When I talk about being in the green, I always mean it’s to the good, regardless in what direction I have bet on. Some readers may not understand the concept of trading up or down, and they will never do it.

To be blunt, not knowing how to bet both ways, only allows you a 50% efficiency rate at best! This rate doubles if you can bet down just as easily. When any trade is all green in Forex, then you even get paid some interest for staying in the green.  I do not give out Intraday day trading setups as you will have to find that somewhere else. I trade between Minor, Intermediate, and Primary degree turns, that can take  8-13 months to play out.

The crude oil market is one of the most skewed trades that I have seen since the 2008 peak and crude oil will eventually crash right along with gold and all other markets as well. You can’t seperate oil from gold as they are intricately linked with the Gold/Oil ratio. Ratios are just glorified ways of producing odds, and knowing your odds is the what you must know, to trade in both directions. In the future I will not trade oil, as there are easier pickings in the gold sectors.

The Gold/Oil ratio was just under 18:1 which seemed to be hitting a brick wall all summer long. When oil started to crash in 2014, this ratio was also 17:1. There is no way that I would bet on long positions if they paid me. Then we have the Wedge sending us a clear signal as well, which they call a “bearish Flag”. It’s a rising wedge and they preceed any deadly bearish situation. One of the most deadliest indicators of a longer-term bearish decline, is the Death Cross! The Death Cross on this daily chart still needs to happen, but on the monthly charts the Death Cross has already happened.

In short the entire investing world are in long positions at the tops of Death Crosses, in all asset classes that I cover. A basic market decline/crash is coming and all those who are not prepared will get hit hard.

A bear market rally always retraces everything back down to it’s point of orgin, so only time will tell when this will come true. No little $40-$45 support level will hold for very long. Anything related to the heating and gas sectors, the Market Vane reports over 76% bulls still present. These are very bearish indicators as it leaves very few bulls to join in.

Deflation is going to be the real threat in the next three years, and oil and gold investors still haven’t figured that out yet!

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