Apple investors are getting hammered including Warren Buffet. Warren Buffet has the biggest stake ever in Apple. I cannot see the logic of buying anything at extreme record highs but rich people are the only ones that can waste their money buying high price stocks. It’s all the other investors that are going to get sucked into thinking that Apple stock is still going to the moon.
Warren Buffet is buying his own stock back as well. If $4 billion is not enough, then just follow this saga as the world is slowing down and heading into another recession. Buffet bought IBM the same way, and look how that turned out. In recent months the Gold/Apple ratio has been the most expensive around the 8:1 ratio and today it sits at 6.0:1 about the same it was back in August 2018. A cheap Gold/Apple ratio is about 21:1, which may never get hit again but when any ratio starts to hit a price brick wall, then this is a sign of a major top. I think Apple is also at a Cycle degree wave 3 peak and they do not correct in just a few months as it could take years for this impending bear market to play out.
This is just a quick crude oil update which has a lot to do with the fears of oil shortages due to the trade sanctions against Iran. Market moves based on fear never last that long if the real trend is still down. Most of the oil rhetoric we have witnessed has more to do with the midterm elections that any real fundamental reasoning. Some analysts also say that there is “no” fundamental reason why oil is heading down. I laughed when I read that as the “fundamentalists” have no fundamental reasoning for crude oils decline.
Maybe they should look at the Gold/Oil ratio as it was hitting a brick wall at 17:1. Today we are at over 19.53:1, which is a bit cheaper in recent weeks, but not near any extreme at this time. Commercials are not even close to becoming net long, any time soon. That doesn’t mean oil can’t rally, but chances are slim a new trend will develop from it.
Any real support is down at the $40-$45 price level but the Gold/Oil ratio also has to confirm it. The Gold/Oil ratio would be much better between 25 and 30:1, but not match that 2016 bottom of 44:1.
If the declining pattern starts to look like a zigzag then, yes I would turn into an oil bull. The weekly chart 200-day moving average is down at the $52 price level after which we hit a “Death Cross”.
On the daily charts, $65 would get us close to another Death Cross position. The 200-day MA can also give us support so it will be critical to watch once we get closer.
This is the December T-Bond chart showing the bull market that started in 1981 and has churned its way up until 2016 about 37 years later. 2016 was the bottom of Intermediate degree 4th wave correction bottom in stocks. TLT has already pushed lower, so that instantly calls for looking into an alternate position. 1981 was also the bottom of a 120-year bear market, which I think is wave 2 in SC degree and that another 120-year bullish phase is in effect. Corrections and crashes are thrown in to keep all the analysts guessing. Two parallel lines, one to highlight the support trendline, and the other to show the trend across the tops.
There is no way of really knowing if Cycle degree wave 1 has completed, but I’m sure this crash would not be enough. T-Bonds are a diagonal type of a bull market which all commodities run under!
The commercials did add to the short positions last week, which pushed TLT to a new low. T-Bonds still have to follow TLT and this may clear up once all the midterm election results are digested later tonight.
As we can see T-Bond crashes in the past have been dramatic like in the 1998-1999 crash. Not a single crash since 1981 was followed by a bear market as the crashes recovered and then continued to new record highs. I expect about the same this time but where we are in this potential Cycle degree peak is still uncertain. In the long run, rising rates are not good for the gold price as investors get a return in T-Bonds but gold only goes up or down. Look what happened to gold in 1980 which produced a bear market that never ended until 1999!
I may change this big count back to 5 waves in Primary degree, but at this time I will keep this zigzag going.