Monthly Archives: October 2018

SPX: SP500 Index Rally Update!

 

Some of these waves in the SPX sure look better from Bigcharts than they do with any of the futures contracts I cover.  We had a nice spike to the downside just yesterday and now the second day, the SPX made a wild rocket move to the upside. Before noon our time, the SPX made a huge spike to the upside, with a huge open gap as well. That makes for a deadly combination, and I see it as a fake start to any mythical bull market we may still be in!  If all the futures-related commercial positions were all net long, then it would be a different story.

Any rally like this starts out, by hitting all the “Buy” orders first.  Now sell orders will be piling up below present prices, and the bulls will turn to instant bears once their stop-loss orders start getting hit. This can go on and on, and once the SPX support prices get close to that February low, then you will see investors really freak out!  There are crashes,and then there are crashes and bear markets. Crashes happen at smaller degree levels. On large degree corrections you often get a bear market rally before the long bearish decline.

This is a Cycle degree bear market and it looks like we are going to get a bear market rally and then the longer drawn out decline. With the major indices it looks like we will get a Cycle degree flat, but, in the end, it might look like a zigzag! I might be posting more SPX charts in the future, as these charts are smoothed out a bit more.

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TGOD And The Results Of A Mania!

 

There is no other way of describing the legalization of marijuana use in Canada.  This marijuana mania is no different than what the bitcoin mania was a few years ago.  They laughed at me we I mentioned that TGOD could fall below $5, well how does $3.00 work for?  I actually shorted this stock several times and made a little money doing it, but I still would not touch any of these stocks, as TGOD could disappear as many of these producers would have to merge. Size matters as I think the US-based companies are already taking over and could gobble up any other grower.

I’m sure you have heard about the great marijuana shortage up here and some shops selling out. Well, any shortage can be fixed in a month, just for every pot smoker in Canada, quit for a whole month.  How long do you you think it would take them to fill all the shelves to the rafters!  Marijuana is a consumer good, so it’s subject to the whims of the age group.

I’m kidding about this, as we all know that there wouldn’t be any takers in Canada!

I put up TGOD as just another inverted zigzag with an “X” wave. We could get another zigzag bull market at a later date.  I do not spend any time on the fundamentals of most companies, and doing your own research is critical.  I have no time and no interest in spending weeks trying to justify any fundamental homework!  Even the Warrant that goes with TGOD retraced its entire bullish cycle.

 

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US Dollar Daily Chart Bullish Update!

 

This US dollar index has just pushed to a new record high this morning! This is not what the Gold experts want, as a rising dollar is not good for gold which has now responded with a price crash of $38! My Market Vane Report shows that about 74% of the traders are in a bullish mood. This is pretty decent but this not at a wild extreme just yet.  Even the commercial hedgers were net long with last Friday’s report, but they can switch just as fast.

I think the US dollar is in a bigger bull market than we can all imagine at this time.  At this time I’m counting the entire US bullish move that started in 2008, as a single diagonal wave structure, which allows for overlapping wave structures. As the US dollar poke higher, we can check the Euro and see that it is plunging. There are a few other currencies that travel inversely to the US dollar and our CAD is also on that list of 6 currencies.  The Australian dollar is not on that list but runs inversely to the US dollar as well.

In order for this rally to be a bear market rally, then 8 months of bullish action must get retraced!  This is not going to happen this year or even a decade from now.  To confirm that the USD is in a bigger bull market than what investors realize, it has to break out and create a  new record high. This high was in December 2016 at the 103.600 price level.

Just eyeballing the weekly charts, we are close to about halfway to this target.

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Mini DJIA Intraday Rally Update.

 

Two days ago this Mini DJIA chart ended with a nice long spike to the downside, and since then the markets have been in a rally.  Is the correction over? Not by long shot folks as the world markets are in a tailspin. If we only had a single wild crash much like 1987, then I would turn bullish much sooner. The problem with thinking about 1987 is that the 1987 crash was just a “Minor” degree crash.  This crash will be larger by 4-degree levels and has a good chance of producing a long drawn out bearish phase, which has not happened since the 1930-32 decline.  1987 was 31 years away, while the 1929 peak to 2018 is now 89 years.  I have learned not to ignore the Fibonacci 89 years as that is 1 year short of the 30-year cycle. If I use 60, 90 or 120 years, just divide those numbers into 30-year sections which I use as my time forecasts into the future.

We can be out by a minimum of 61% (.618) In price and time, so I want to be very careful when I move a big degree around in the future.  Imagine jumping 100’s of years forwards or backward in time by drawing a number or letter on a chart! Flipping numbers and letters around like flipping burgers is just like a warp jump going to Mars. It might take until Supercycle degree wave 3 to colonize Mars towards the 2041 time period. 2041 is only a “one” degree jump while many others are over 3-degree levels off.

At the intraday level, it’s a different ball game, but I look for all the Minor degree turns first. All the warnings investors got with this market top, they still think they can escape before the crowd. Some experts are still as bullish as we can get and they seemed to want to ignore the reversal of fundamentals that the Trade War is bringing.

End of the month has arrived and if this bearish market has legs, our present little price support will never last!

 

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Amazon Crash Update

 

 

The stock that investors once loved has now crashed since the August 2018 peak. There may be an expanded pattern with this top, but for now, I will leave it out for now but a 5 wave sequence has started, which would be 5 waves down in Minor degree. I will have to adjust later but in the end, this AMZN crash is far from over. Over $119 billion has gone up in smoke, chopping the elephant down in size a bit. Buying on the “Dip”?  Ok, that sounds like fun! AMZN could get cut in 1/2 again before any real bottom may present itself.  The world is slowing down as a potential recession is heading our way.  We might not see a large counter-rally until the media pumps out the bearish news. This could all remain bearish for the rest of the year, but eventually, we should also get a Primary degree counter rally within the next 4 years. The trend is obviously down as buyers are no longer in love with Amazon.

This is not some little correction in a bull market but it is the start of a huge bear market that only a few have been warning us about. If anything then  AMZN might become a “Buy”, once Solar Cycle #25 has arrived. AMZN sure charged up with Solar Cycle #24, so I expect the same to happen again.

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PLAT: Platinum Stock Index Mega Crash Review

 

PlAT is just an index of  Platinum related stocks and it seemed to have peaked in 2007 and then followed all other indices down as well. There is no way I can put a wave count to this, but we could be at the point where Cycle degree wave 4 has already bottomed. We may still be in a fake rally but longer term I’m very bullish. Was the crash a human-caused crash, or just another flash crash?

This is a chart with weekly settings and the crash shows up as a single drop. Platinum is the third highest traded metal after gold and silver, but the media does little to report on platinum.

I only wanted to post this ugly looking crash once, but I will post a little more with the ETF that tracks platinum as a metal. (PPLT)

When we take this same chart and switch it to a monthly setting, then that solid line you see disappears and we are left with a massive gap!

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T-Bonds Intraday Bullish Review

 

T-Bonds hit a bottom Oct, 9th and since then has been producing higher lows. Longer term I’m very bullish on T-Bonds, but T-Bonds contain diagonals that are very difficult to tell if the trend will continue. I started this bullish wave count with very small degree waves and will build on that until a wave 1 in Minor degree comes to an end. T-Bonds have a long records going back to 1861, which took 120 years to correct, into the 1981 bottom. T-Bonds produced another major peak on July 11, 2016, after which it crashed again, ending this October.

I sure would like to see more bullish action as that would take the pressure off raising rates. I will keep this brief as anything can still happen in the short term, and we need more time and distance to be confident enough to have a real bottom.

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IVV Fund Inflow Update

 

 

I’m sure investors are paying attention when funds are flowing into IVV and SPY. Last Thursday was one of those days that reported billions of funds flowing into these two sp500 related ETFs.

Who says that these fund flows isn’t dumb emotional money thinking the bear market is over!  This kind of fund flow always happens near tops just like in January when investors stuff their accounts to make it for the 2017 tax season. In late January 2018 is when my 5 wave counts finished, which was followed by another record-breaking secondary top. The bullish “C” wave is about as choppy as you can get, so this tells me that IVV was also in a rally going against the larger trend. Missing an expanded top anywhere throws the entire wave count into disarray forever, if it is not rectified instantly.  Every major index in the USA has this expanded pattern, so it’s not just one lonely little pattern. Expanded tops happen frequently so they sure are not rare market patterns.

I started a new category with IVV as I may post more of IVV in the future.

Since the expanded pattern is basically an inverted flat or zigzag, it would be a bear market rally. To confirm that this is still part of a bear market rally, then IVV still has to crash below that $256 price level.  Lower lows and lower highs are the signs of a bear and right now we are in No man’s land like Flanders Fields, except we have bulls and bears fighting over who controls the space.

These counter rallies can be terrifying for the crowd that is fearful of missing out. Decisions made under fear never seems to work out very well.

I don’t trust in-flow numbers that much as I think insider buying reports are far more important.

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Blog Search Engine Stats And Pages Viewed.

 

I thought I would post some stats for Elliott Wave 5.0. The above chart just shows all the sources of search engine stats with Google leading the way by a wide margin. These are mostly organic search hit results,  with the bottom darker lines created by all other search engines. I was very happy once my average page views started to hit 2000 pages viewed per day.  There are dramatic spikes and huge drops as well but in the end, the trend is generally still up.

 

This screen clip was taken early in the morning which shows 1495 pages viewed already, so today should be another good day. Yesterday well over 4100 pages very viewed in one 24 hour time period. This internal stat counter also shows 79,925 pages viewed in one month and we still have 3 days to go. Using rough calculations I figured that this blog could hit a million page views by the end of the year, but this has been achieved in October already. One day, 3000 pages viewed per month may become normal and I would be very happy if those kinds of numbers eventually materialized consistantly.

If readers like they can conduct a search in any search engine using, “Elliott Wave 5.0 Reboot”,  with large image settings. This will ring up many of my charts on the first page or so. I know most all my wave counts are floating around the internet but it may be impossible to find all of them.

As nice as some of these numbers sound, there is no critical mass here. In the last three years, not a single wave analyst has come forward that wants to keep Cycle degree wave analysis alive. I have had some financial support from a few dedicated fans, but costs in keeping this site running are not getting any cheaper.

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Friday, Silver, Copper, Gold, Commitment Of Traders Report: COT Review.

 

 

One would guess that last weeks bullish action in gold will keep right on going, but the commercial hedgers don’t see it that way as they all added short positions last week.  Even the Palladium hedgers made bearish bets last week with Platinum starting to be the exception.

I believe Platinum will eventually turn very bullish for a long-term bullish move, but any short-term downside can still happen.

Commercials are also building a large net short position in the US dollar, which would be very bullish for gold. 5 bearish COT reports may have more power over a single Currency at least in the short term. In typical fashion the speculators chased the golden bull as a run to safe-haven seems to be front and center. In the end, all emotional bullish moves come to an end as speculators always get into one trap or another.

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HEDGE: Cycle Degree Bottom Review!

 

 

 

In September HDGE completed a bottom before it soared as fear starts to take over this market.  If the general markets hit their mania peaks in January of 2018, then HDGE should also contain an expanded pattern. Our present move up will need corrections and backfilling. In the end, I’m looking for 5 waves up in a Minor degree to complete a potential “A” wave in Primary degree.  In order for that to happen, HDGE still needs to retrace and take out the $8.60 price level.  HDGE goes up when stocks go down, so I will remain bullish on HDGE until the majority want to own some HDGE shares.

The crowd is always late, so jumping on the bandwagon at this time will give you the same results as the majority get, usually nothing! Even a falling wedge can be clearly visible, which are powerful reversal patterns at all degree levels. We still have time this year for HDGE to fill out a set of 5 waves in Minor degree, after which a huge correction will send HDGE plunging one more time.

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GDX: It’s Now Or Never!

 

 

Gold stocks made a recent high-speed drop that should be enough if the next bullish phase is supposed to be for real. GDX must not fall below the $17.28 price level as 100 % retracement is just another bear market rally. A bull market is supposed to give as higher and higher lows which have not happened in over 2 years. Every attempt to go higher has refused to materialize.  Since the 2011 peak, all rallies were just mini bear market rallies as each rally has been completely retraced, except for the 2016 peak! The 2016 bottom created a bear trap producing that funny looking 5 wave sequence. The vast majority of these moves are just “A” waves, but in the case of GDX, it’s part of a potential “C” wave.

Gold charged up again today getting close to $1242, while GDX was not impressed that much by gold’s move up. All bear market rallies retrace themselves, so it’s just a matter of time before I throw my hands up and surrender to the gold bulls. Platinum has the exact same pattern as GDX and other ETFs, but there was no support for platinum as it established a new bear market low.

The Gold/Gdx ratio is not that extreme by any stretch of the imagination as 64:1 is not the 84:1 ratio when GDX hit rock bottom in late. I sure would like to see the Gold/Gdx ratio spread much further, indicating that it’s getting cheap again when compared to the gold cash price.

Hopefully, we will know more by the end of this month, as many turnings happen at month end, or the beginning of the month.

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S&P TSE Index 2014-2018 Update!

 

When I looked at this chart I instantly noticed the exact same pattern in this TSE chart during the 2015 crash as the SP500 -8-9 months.  The only difference is this move did not expand higher, but otherwise, it is the exact same wave pattern we have been getting since the January 2018 peak. These are ugly patterns, but sure have characteristics of the commodities diagonal wave structure I use.

After the January 2018 peak, another expanded pattern developed, and still, the outcome will be the same.  In the long run, the bottom trend line may not hold but at this time it is a bit early to speculate about it.

Canada is in serious trouble as our Fed is determined to crash the markets with their stupid outlook about inflation. The Bank Of Canada rate increase may not sound like much but what rate increases do is drain the liquidity from the economy. Very few people will have an appetite to borrow money for an overpriced home or condo. The bull market is over folks, as the anticipated bear market is going to last much longer, and fall much deeper than we can all imagine at this time.

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SP500 E-Mini 2000-2018 Review: Bear Market 3.0

 

 

I thought I would post this chart to show that there is also a huge wedge at play in the markets as well. Call it a reverse Megaphone if you, like but the recent bearish moves are up against a big support trend line that is going to fail. The 2007 peak was much smaller and sure added to the confusion, if 2007 was a “B” wave top or not. Join the Primary degree wave 3 with the Primary degree wave 5 (Jan 2018), The same parallel bottom trend line might give us some support, but eventually, that trend line should not hold as a Cycle degree bottom would trash the Primary degree trend lines. Analysts are worried about some 10% or 20% correction before the markets soar again. I’m sure they will argue for years trying to sort out the 3 tops in this SP500 chart.

It took me years, and not until I switched to Cycle degree wave analysts over 3 years ago did things start to make sense and fit better. I will never switch to a higher degree as that is happening by itself already!  We are lucky as every major dip only took about 5 years or so before new record highs were achieved again. Supercycle degree wave 3 could take much longer, to surpass our present peak of 2900.  We have 2 major price support levels that very few think can even happen, but more and more are joining the bearish trend.

Things have changed dramatically since the January 2018 peak as the moods have turned bearish. Just because the stock bears are shredding bullish investors accounts does not mean a contrarian buy signal has arrived. I will remain bearish, until at least a potential “A” wave in Primary degree arrives, and that may not happen for months. Commercial COT reports show that they are net short in most of the 5 indices that I cover. Until they start to build net long positions a real bottom is going to be hard to justify. Bear markets and crashes are just part of bigger bull market corrections just like the 1929 crash has demonstrated.

Since 2000 this will be the third crash I am attempting to count down and chances are it will be my last one. My goal is to get most of the indices down to a Cycle Degree wave 4 bottom, but after that, this blog may shut down.

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NASDAQ Plunge Update!

 

This is the December contract which shows better when I use line type settings, but it also changes many of the wave positions.  At the top could be my first wave 1-2 in Minute degree which would make the October rally as the potential 4 waves in Minute degree which brings us to a potential wave one in Minor degree. I will need to make adjustments as this bearish phase develops, as there is more than one index that shows a high wave 1-2 pattern. Nvidia Corp has crashed over $100 already as demand for Bitcoin mining has faded fast. Fear of just about anything is pushing the markets down, besides the Fed is creating a worldwide, liquidity issue.

The Midcaps are much further along the slippery slope already and they may also be ready for another rally. Short term I may be a bit bullish but longer term a huge bear market is coming if we like it or not!

What really irks me is that the talking heads are saying to stay in the markets for the long term. This is nonsense if age is not taken into account. Many boomers that were invested in 2007 got wiped out and many have never recovered. Even early Gen X start to retire in 2029, and many will never have enough time to recoup up to 70% losses!

You can check your older relatives and I bet few if any can say, “Yes I retired at the top of the stock market with my mutual funds intack”.

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Gold Daily Chart Rally Update

 

This morning gold is producing a small double top with a few small spikes before gold started to make another correction. If this is the big one already then there is no way that gold should crash very deep before it lifts off for another leg up. That’s the song and dance we get from all the bullish gold investors. Is this the start of a 1-2, 1-2 count? In a wave 3 extension, there are only about 3 sets of 1-2 waves that will happen, so we need one more, smaller 1-2 wave set in order for this trend to keep going.

Any move down that retraces below that $1180 price level will kill any idea of this gold rally to be into a bullish phase.  This gold rally has a good chance of being a fake start, and if the markets are good enough to confirm this, then we still have wave 3-4-5 to complete.

Platinum made the exact same move as gold, but platinum crashed to new record lows already, with about the exact same wave count as in gold. The difference since the 2016 bottom is that platinum was far lower and more sideways in the last year and 10 months.

Silver is also reacting but in a subdued fashion as well. Silver only has to fall below $13 and it will have resumed its bearish phase. It’s more important to watch silver as it walks to a different drummer than what gold is walking to.

The markets have been tumbling this week, and when stocks rally again, gold investors will run back into stocks as fast as their little fingers allow them to click, as fear moves never last that long.

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Has Solar Cycle 25 Arrived?

 

Some science sites are already suggesting the Solar Cycle 25 is already here, but I doubt that very much. Spaceweather.com did a very good job of tracking the arrival of Solar Cycle 24 and I think they are doing just as good of a job this time. The total spotless days in the year are still a long way away, which might give us an entire year with 70% of sun activity being blank! This happened in December of 2008, and by March of 2009 the world stock markets turned and the great recession started to come to an end.

If you look at the first solar peak in 2011, this matches the gold price peak so well, I choked when I first saw it. All of the commodities started to take hits from the 2011 peak, so to say that the sun has no impact on earthlings, is a silly idea at best. Even climate change scientists (IPPC Report) recently declared that earth is going to meltdown if we don’t stop pushing CO2 into the atmosphere. It’s the end of the world if we don’t. Fear mongering is what the IPPC does best so to fight this fear observe the turning your self in the next few years.

When sunspot activity is low it allows extra space radiation to hit the earth which Spaceweather has been tracking with science students in California and other areas of the USA. They also track the radiation for flyers as the increased space radiation can produce problems during flights over the north pole.  The weekly weather balloon readings of the space radiation reports will show decreasing radiation numbers after Solar Cycle 25 arrives. I’m no solar scientist but I have been tracking solar cycles since before 2000!  The EWP books contain stock market and solar cycle connections and it is obvious to me how the bear market in stocks stopped, and a new bullish phase started.

Don’t you just love that, “You are here” arrow, so I thought I would add this chart just in case we are lost!  The secondary peak in Solar Cycle 24 was a bit higher but that peak matches my wave 3-4 correction in Intermediate degree. Solar Cycle 24 is also one of the smallest since the early 1900’s, and Solar Cycle 25 could be smaller yet. My bet is that Solar Cycle 25 could end up being just a bit taller than Solar Cycle 24, which remains to be seen. Solar activity shows Elliott Wave patterns all the time as the 2014 peak sure fits an expanded top! From the 2009 bottom the solar cycle also produced very nice 5 wave runs, but on the downside, they make 3 wave counter-rallies, just like any bear market rally in the stock markets.

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Artificial Intelligence: BOTZ ETF Crash Update!

 

It looks like this AI ETF has a real emotional crowd selling all the AI stocks! Just goes to show that emotion has the ultimate power.  The top has one wave position missing and by doing that, I am breaking my own ‘Law” so to speak, leaving an uncapped 5th wave. I couldn’t fit it in, but this is also Cycle degree wave 3 when a potential Primary degree zigzag bear market could also develop. The sloth of smart bears have taken over and there is no amount of bullish jargon that will turn a trend, that still needs to finish. This could sync up with the stock market very well as a potential wave 2 counter-rally.

I have no real Gold/BOTZ  ratio profile made up but I still have to back-check the extreme ratio. Today this ratio sits at 64.26:1 but this could still spread much further by the end of the year. No amount of ratio calculations will help here, as we have no real knowledge how pumped-up the AI stocks really were! BOTZ could suffer the same bear market length as stocks, which I expect to end sometime in 2022. When solar cycle #25 starts up in sunspot activity again, I’m sure all the companies inside the BOTZ ETF are going to get energized. Only time will tell if this keeps heading south but another sideways correction should happen by the end of this year.

As much as I’m bearish on BOTZ now, that will end once solar cycle #25 sneaks up on us!  The start of solar cycles are bear terminators, so this is when you can witness and feel the mood change along with the sun morphing into SC#25.

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Brent Crude Oil Intraday Crash Update.

 

WTI Crude, Brent Crude and RBOB gasoline, have made a very strange top, which we can see when switching between daily and weekly charts. This happens many times with futures charts, and the shorter version of this explanation is that an expanded top may have also formed. In the last few days, I have been reading stories about what is causing the crash, and to no surprise, there were no shortages of different reasons why Brent crude is crashing. We may focus on OPEC, but at the same time the EPA comes out with inventory numbers that oil traders didn’t like.

President Trump has given a “Green” light for Saudi Arabia to produce as much oil as they want! If that wasn’t a hint that oil prices were coming down, then nothing is!

The “Bullish Exuberance” in Brent crude oil is starting to fade, but how deep this correction will go is still a flip of the coin. We are presently in an oil rally, so more upside could be coming.

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Lumber Crash Update!

 

The lumber price crash is normal, and is an example that “investing” in lumber does not work! Every trend ends and lumber ended its bullish trend in May 2018 ($660). Watching the lumber prices crash is a pretty clear signal that the real estate market is also crashing. I’m looking for a potential zigzag in a Primary degree which could take years to completely play out. Even then lumber prices could be subdued for decades. Don’t think impulse but think diagonal, whenever we get connecting zigzags.

The majority of the world uses fundamental analysis, but I bet not a single person knows what “fundamentals” created the wild spike to the upside and then the impending crash. In the end, fundamentals are thrown to the wind as traders just want to ride the lumber bull in fear of missing out.

I will not post every little turning as I only need to confirm Minor degree or higher moves.  There is no real price bottom I can give, but $220 would not surprise me when we get to the previous bull market correction bottoms.

Every Tuesday I get the Market Vane report which always tells me how many “bulls” are present when surveyed. The MV report has been around since the 1960’s and has been respected ever since.

I ordered the subscription many times in the past, and have hard copy files of many that I keep in a binder. It was the 98% bulls that were present at the peak that instantly prompted a crash warning as 98% bulls present leaves nobody left to still come in. At 98% the lumber prices were doomed. This week my lowest reading was already 36% which is a huge drop. Mind you, it may take well below 16% bulls before a solid base can be established.

 

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Palladium And the Impending Crash.

 

Compared to platinum, palladium is in a different world or that’s how it seems. In the long run market trends never last and palladium is pushing higher where we are about 60 points away from new record highs. New record highs can produce new record lows as this palladium monthly chart clearly shows. The choppy pattern is pretty normal, but counting it out to figure where we are, is a different ball game. What do we call a bear market in palladium when all it seems we get big ugly crashes in palladium. I see it all as diagonal wave structures.

I think palladium is finishing wave 3 in Cycle degree and it may still have a bit to go before it dies!  I see a rising wedge which is about as bearish of a signal that we can get. There are 2 big wedges, and at least one of them will give us a dramatic show in the next few years! Commercials are net short palladium as of last Friday, and when they slowly start to switch, then any bearish move will start to get tired and a reversal would be getting close. I know the book talks about “Truncation” in a 5th wave but what does that really mean?  I see many “Truncated” wave structures all the time and I see them as very bullish in a bull market and very bearish in the start of a bear market. In this case, the “A” wave is very long but the “C” wave is still “Truncated” or shorter.  Zigzags are rarely even as they can stretch so wild that they are hard to believe.

Truncation at a major bottom is a very bullish signal, and the reverse is true at major tops. The 2008 bottom is a prime example of a flat which can be called truncated, but I see them as running flats or even running zigzags. During the 1990’s silver had more “Truncated” waves than we can shake a stick at,  and they were all extremely bullish signals. Even when we go back to the 1980 palladium crash, look how long that “C” wave was in a zigzag! If it happens once in history then I use it for any degree move as well.

So if a Cycle degree palladium crash is expected, then another zigzag would be my first logical guess.  It would take little to crash this palladium chart and no amount of fundamental jargon will stop it from crashing.

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DJIA Intraday Crash Update: No Rules In A Bull And Bear Fight!

 

It looks like the markets are resuming their larger trend if we all knew what that large trend actually is.  This is my third big stock market crash I am actively tracking and it is also the third peak that has to have a wave position to it that fits. Most markets I am tracking have an expanded pattern to them which ended October 3, 2018. The real top ended in January of 2018, just about 10 months ago.  I know how much the wave counts will distort every outlook if we keep ignoring any expanded tops. The January peak is my third wave 3-4 peak since the market bubble top in 2000, and it should produce bear market conditions that will be worse than what the 2008 crash produced, but not as bad as the 1930’s depression.  1932 was my wave 2 in Supercycle degree, which will not end until we get closer to 2041.

In the short term, it could take until 2022 to play out, but we should also get another huge counter rally that not too many people will see coming, as they all think that the bull market has returned.

Gold reacted positively to this market decline, which may be a good sign for gold investors, but a “run” to safety is a human emotional move that will reverse just as fast because if stocks start to rally again, they will dump gold and gold stocks in a flash. The markets have never been tested with the world on “High Speed” data lines, where flash crashes could become normal. We have seen what high-speed computer trading has done in the past, and the FCC is powerless to do anything about it.

I have flexibility when counting down the start to this bear market, but sooner or later real fear will take-over then all the analytics in the world will not work, nor make any sense.

All those that are calling to, “Buy on the dips”,  do not know how big this stock bubble actually is. This market should have a Primary degree counter rally coming, which is when I will become bullish again.

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S&P Midcap E-Mini 2000-2018 Update.

 

I had to use 1500 bars with this weekly chart as it shows better contrast. I started back with the 2000 peak which was followed by a very clean or near perfect expanded flat that I have run into. The correction only took a few years or so before it turned and started to soar north again until the 2007 peak!

At the 2007 peak the majority were extremely bullish and they saw no end to the good times! Market Hulbert did a very good job of recording the 2007 bullish top as he collects all his own data!  The bullish herd never listens to the bears stock outlook anyways, so the majority got hit hard all the way down until March 2009!

Even when all the indicators showed that the 2008 market crash is going to turn, the Elliott Wave crowd were looking for a much deeper run well below 1996 price levels.  Hell looking for another 5 waves down in Primary degree would have taken the Sp500 Midcaps to “ZERO”!  Insiders were already buying everything that was crushed in price, yet the wave counters remained extremely bearish.

The records how bearish market analysts were at the 2009 bottom are still floating around the internet! Having a bearish wave count, and ignoring the start of solar cycle #24 along with every bearish investors will never work. They will never work when it happens with the start of solar cycle #25!

Even Warren Buffet’s scream to buy stocks in 2008 the wave counting crowd was oblivious to all of it!

When you look at the big picture we can see that the 400 price level has some serious support. This could end up being major support for any future bear market that you can dream up. Any Cycle degree 4th wave bottom may stop well short of a new record low, so chances are good the wave counting bears will miss another huge bull market being set-up!

Many boomers were wiped out with the 2007-2009 crash, so buy and hold will not work for the older folks getting ready to retire.

The Fed is creating a liquidity problem around the world by raising rates, and subtle reports show that is exactly what is happening. President Trump is at odds with the Fed as they choke the life blood out of this market. All those that think gold is going to fly due to inflation are fighting the Fed as the Fed is trying to kill inflation.

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Platinum Weekly Chart: New Record Low Update!

 

I recently posted the COT report for Platinum which was negative as the commercial hedgers switched to net short positions in 5 of the precious metals.   Palladium is making new world record highs, while platinum has been crashing to new record lows from its 2008 peak. Talk about a wild inverse picture that palladium and platinum are showing this month and its been going on for many years already.

For a few years the platinum decline had a hard time getting going, but with diagonal wave structures it can take a long time to sort out and I will still work on it. Notice how platinum has the exact same triangle pattern as gold has, except in gold they call the same move a bullish move, while the exact same pattern in platinum is confirmed that it was a bear market rally. From the March 2008 peak to the October 2008 bottom, the platinum bear market rally has been completely retraced by a margin of about $6!  I think there are still new lows to come as the remainder of this 5 wave sequence still needs to finish.

Just because it’s a small degree decline, does not mean it can’t extend, and make the 4th wave rally long and complex. Silver is the closest to making the exact same move, yet the bullish gold analysts swear up and down that gold is going to soar. Once this triangle is finishing, then I am forced to look for a 1 or even 2 degrees higher positions.

In this case, it could be wave 4 ending in Cycle degree. Another bullish phase should happen but any impending bullish rally would take a long time to show itself more clearly. This gives me the extra time to see a proper pattern develop. About the only good thing that will happen is that I no longer will be a bear towards platinum. I will not shy away from being a bear when I see metal asset classes still have more downside to go! This does not make me very popular with metal investors, especially the gold bugs!

 

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Gold Weekly Chart, 200-Day Moving Average Update!

 

I realize that my bearish precious metals outlook does not sit well with many of the gold bulls still around today. The gold bulls that only see or want to see a bullish gold wave count will not find it on this blog just yet! The people that like to shred my work are the bullish investors. There are thousands of sites out today that will cater to your gold related bullish needs, and they may even be telling us about a $5000 gold price coming soon!  They always use the fiat money printing fundamentals as a reason to hedge, or stay invested in gold!  This time I included the 50-200-day MA and we can see that gold is hitting the 200-day MA line. Gold would have to rise sharply to get above and stay above, this 200-day MA. Since gold is still in the glow of the “Golden Gross”, then the 50-day MA must not fall into the 200-day MA, because then we would get a “Death Cross” in this weekly gold chart. I track 3 major gold price support numbers with $1160, $1120 and $1047!

The gold bulls need for gold to break well above $1400, while the gold bears need gold to crash below $1047. The entire gold related analytical world is focused on these two main price levels.

Which price level is going to get hit first?  It might take the rest of this month or even longer before we can become more certain. All my metal COT reports do not support a big bullish surge at this time.

All the wave counting in the world will not help us forecast the gold price if we have no clue what that 2011 peak actually was.

I included the silver, copper and gold COT report again, which I see as very bearish indicators. The herd of metal analysts always recite or use the non-commercial trader’s numbers, but they are always the group that gets into a trap be it a bear or bull. The COT reports get posted on Fridays and investors have the choice to read or ignore.

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Silver, Copper, Gold, Palladium And Platinum COT Reports Update!

 

Every Friday the government releases its Commitment of Trader reports, (COT), but it always has days missing as they work Tuesdays, to Tuesdays. Other COT reports I use don’t have such a delay, but they have no US dollar report at all. When we look at silver the commercials are now net short. Not by any extreme but still, they are bearish.

Look over to the speculator positions and they are net long! Speculators are the trend chasers and they care little about taking any delivery of any metal! Commercials are also net short in copper and of course gold as well, adding over 49,000 long contracts.

Aluminum is also on the list but I did not include it.  At one time the aluminum non-commercials were net long by a ratio of 14,000:1,  blew my mind, to say the least.

If the professional hedgers are this pessimistic on gold why should I expect gold to soar anytime soon?  Any bullish wave count I do create for gold will constantly fail if I ignore these types of numbers.

To really rub salt in the wound, the commercials are also net short with palladium and platinum.  All these numbers do not support a quick return of any gold bull market.

 

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Shanghai Bear Market Continues…

 

The Shanghai index topped in late 2007, after which it crashed in a dramatic fashion. This also matches the crude oil peak very well, with that secondary peak never reaching new highs since. I see the crash and counter-rally containing an inverted zigzag.  The long trend line from the 1996 bottom did not hold back the bearish mood that is starting to hit stock markets around the world.

Any bear market rally always retraces itself, back to the point of origin, which would be the (A) wave in Intermediate degree. Of course, it can go much lower as well. We also have one crazy wedge that can give us a clue that the Shanghai index is going down. I show a 1-2 wave count in Minor degree, but that can also be the 4th wave  already, due to its length in time it took to counter rally.

We will know more as we get further along in the year, as once a trend resumes it will not stop until it is in an oversold position again. A zigzag decline leading into a Primary degree “A” would definitely give us another bullish phase as another bear market rally,  which can be an inverted flat. I have no COT, or MV report available to use, but all the North American markets do. When the commercial hedgers all turn net long, then the Shanghai will also rally.

Mark Hulbert posted a great article that will give a few people something to think about.

Opinion: Would you recognize a market top if it was staring you in the face?

 

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SPX 2018 Elliott Wave Review

 

 

SPX is another SP500 type index. IVV is also a Sp500 related ETF.  It was the January 2018 peak where my Cycle degree wave 3 resides. What followed was an expanded type top, which most USA indices displayed as well. The last 8 months were very bullish with record new highs, which has now reversed. “C” wave crashes have a tendency to do exactly that, so this bearish move is not a surprise at all.  Any company inside the SPX will also get trashed, as all the high fliers have crashed as well.  I don’t think we are at wave 1 in Minor degree just yet, but it can easily be adjusted at later date. The choppy 5 waves you see ending in October, are diagonal waves which are also an indicator that the SPX ran against the larger trend.

There are forecasts being made to stay in for the “long” haul! Investors will suffer huge losses and could end up waiting 3-4 years just before we hit a major bottom. Can investors handle a 70-75% stock market crash? Every major top, since 2000 had the experts telling us to stay in for the long run. The only reason we get told this is because the experts have no clue how deep any correction can go. The stock bubble mania has ended folks, and from here on, the younger Millennial crowd of investors are going to take some serious hits if they are still invested.

The function of stock markets declining is deflationary, just like in 1929-1932 and in 2007-2008.  If any boomers are still invested then, they will get wiped out as boomers are retiring at a rate of 10,000 per day!

We are looking at a potential Cycle degree decline in the next few years, and it will not stop with a simple 10% correction. A 40% correction will not do it as well, even though 40% is my standard wave 4 correction depth.

 

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Euro Weekly Chart Bearish Update

 

When we look at a longer-term weekly Euro chart, I see a bearish trend still bouncing off two parallel trend lines. My main change is that I switched back to making the 2018 peak the 4th wave in Intermediate degree.  The Euro is inside the US dollar basket, and you can’t separate the Euro from the US dollar. The Euro has been “melting” down since the 2008 peak so why should it suddenly stop its bearish trend, and turn and fly north? Many countries under the Euro have serious issues as now they start to blame everyone and anyone for their troubles.

The Euro is just down 1/3 of the wave from the top trend line, which I call “no man’s land”. It may take a few more years, but the Euro should hit a new record low by 2022.

Today is also the 1987 stock market crash anniversary date, 31 years ago.  2008 was a major Cycle degree wave 4 peak, which matched the crude oil top as well. 2008 was also the start of solar cycle #24. There were two solar cycle peaks, in 2011 and a secondary peak in 2014. Each time the Euro repelled to the downside from these solar cycle peaks, but in the next few years, solar cycle #24 is coming to an end! My bet is that the Euro will repel to the upside along with solar cycle #25. Analysts will come up with all sorts of different reasons why the Euro goes up and down.

You read 5 Euro analysts updates, you can find a different fundamental reason as well. For gold investors, they need the Euro to soar, which in turn should crash the US dollar. This is not happening as the US dollar keeps displaying its bullish behavior.

On the smaller scale, the Euro and the US dollar both displayed a Minute degree triangle 4th wave, so that is also an indicator that I must up my degree level by a minimum of 1 degree, but many times there are two-degree level changes that have to be made.

 

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VIX Monthly Chart 2007-2018 Review

 

When I look at this VIX monthly chart it is impossible to count each little wave as there are no impulse waves to count. VIX and any commodities belong in the diagonal world where all the Elliott Wave impulse rules are broken. This is how options also behave because the VIX is built on using SP500 options.  Each spike to the upside represented a “Buy” signal in stocks, but we are nowhere near that point at this time.

The VIX should eventually see that $90 peak again but not before any potential “A” wave in Primary degree arrives.  Any move above those  $50 spikes, would start to get us close. Any “B” wave top in the VIX would be a stock market buy signal.  Watching the VIX is about as exciting as watching paint dry, so not to many analysts even give the VIX any attention.

The VIX is an emotional indicator, which is a “fundamental indicator” which can be used for the EWP.

The commercial hedgers are still net long, but it is starting to shift.  When the commercials have built large net short VIX positions, then the end of the VIX bull run would be getting close.

That $9 base is huge so at some future extreme when the VIX hits $9, you know it’s high time to run to cash.

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