Author Archives: "BB"

Nasdaq Daily Chart Death Cross Review

This is a daily chart using my standard 500 bar time periods. What is very important is technical indicator called a “Death Cross”.  Call it the Grim Reaper if you want,  but they both are guaranteed to steal bullish investor dollars. The 50-200-day MA is a deadly technical indicator that signals a long term decline, and we are just witnessing the start to this decline.

With the weekly chart the 200-day MA is down at the 5400 price level which could supply support and the potential for a “Golden Cross”. The Nasdaq is not the only asset class with a “Death Cross” as the SP500 also has one.

With this drop we would expect the Gold/NASDAQ ratio would improve. It did, but we are coming off a record extreme ratio of 6.38:1! This beat the old record by a wide margin of 4.94:1.  We want this ratio to compress as 1.18 is one of my “cheap” ratios which could still be years away.

Hits: 1

Crude Oil Intraday Chart: Bears Still In Control!

This morning WTI crude oil hit  a bottom  of $47.84 after which it started a bit of a rally. Since the December peak crude oil has been grinding down with many overlapping waves that I can’t count as impulse waves, but they sure look like they can fit into diagonal waves.  If we just bottomed then another zigzag rally should happen. This rally has no speed limit to it, so it can take its sweet time if need be. The only thing oil can’t do is soar above my wave 2 in Minuette degree.

The Commercial hedger COT report still shows that they are net short by a wide margin which hints that a super bull market in oil is not about to materialize this morning. We are dealing with wave position “unknown” to us most of the time. Fundamentals are also unknown as every country around the world is fudging its own oil related numbers. This is all about the process of eliminating wave counts that just don’t work. I manged to get in a couple of short trades on the way down but hesitant to go long with anything but a very small position. Even this mornings bottom may not hold, so I will wait it out.

The Gold/Oil ratio has improved with this recent oil price drop, but can still get much better. The Gold/Oil ratio sits at 25.65:1 which is much better but still far from being extreme. We don’t have to hit a new extreme ratio, as hitting the “Ratio Brick Wall” will do the same thing.

Hits: 3

SPX Crashing To New Lows And The Impending Elliott Wave Bear Trap!

This SP500 index gives a much better wave count as the futures specific month can give wild and erroneous spikes most of the time.  The herd of analysts has just figured out that the markets are in a bear market. This is not rocket science if every conventional  analyst on the planet uses the same set of numbers. The majority will take much longer to figure this bear market out because we really don’t know what the bubble degree top really is.  My bet is that most wave analysts will be looking for wave 1-2 in Primary Degree!  They tried that trick in 2009 and it didn’t work then and it sure in the hell is not going to work this time.

My wave count also has to end on a Primary degree which will produce a dramatic reversal that could be longer and much bigger than what any wave 2 in Primary degree will produce.  Besides that point, 5 waves in Primary degree will never complete before solar cycle #25 starts to wake up! New solar cycles are bear market “Terminators” and we still need to see a recession arrive.

Solar Cycle #25 has not started yet as the new solar cycle starts in the northern part of the sun.

The gray bars represent the recessions we’ve had since 1950. It sure looks like another recession is due and the only difference will be the severity of it all. It may take until  2020 or longer before the entire devastating picture can be seen,  but I’m sure another gray bar is going to get added to this graph in due time.

Trillions of investor dollars and your pension dollars are going up in E-Smoke as they call it “Lost Money”. There is no lost and found place to reclaim this lost money, as it is all built on debt. Debt is leverage and some of the worst leverage is in the real estate world.  Until most of this leverage world is unwound no true bull market will emerge. The worlds problems are not going to get fixed in a 2 or 3 month bear market!  One of the worst bear markets from 1929 to 1932 only took three years, so we can expect about the same with speed being the defining factor.

Hits: 6

DJIA Index: Bears Are Still In Control!

I have looked over many other wave analysts work and I haven’t seen a single wave analyst that recognizes an expanded top. The majority will show you intricate wave counts and mostly done using candlestick settings. EWI has never used candlestick in any of their books and neither will I.  I will never post thousands of super-small or super-micro-mini wave counts as that is not Elliott Wave analysis. The crop of new wave analysts are showing you how much free time they have as they are trying to baffle us with bullshit. The Elliott Wave Principle (EWP) is basically a visual technical painting tool. They might paint you a beautiful picture but many times what they paint in their computers, they can never repeat it in freehand on a printout.

I have always done Elliott wave analysis in freehand and still do. Once 2018 finishes, I will only show the late September position as the most important wave to count from. I have Cycle degree specifications I follow and Minor degree wave positions are my most important waves. Minor degree is 3 degrees below Cycle degree. I also work 3 degree levels above Cycle degree, so I end up with a spread of 7 degree levels. Keeping the degree levels down stops us from time warping into the future. Being out by one degree can send us into the future by 30, 90 years or longer, so changing wave positions should be done “Like a Surgeon” not like some person flipping hamburgers. The more they flip numbers and letters around the more obvious it is that they don’t have a clue where they really are.

It is amazing how many wave analysts fall into the trap thinking that 5th waves can extend across multiple generations. 1932 to 2000 would cover about 3 generations (68 years).  At a minimum the markets should have crashed back to the previous 4th wave of one lesser degree, but the markets have missed this 3 times already. Yet they insist we are in a Grand Supercycle degree world.

It may take another few months into the spring of 2019, and as a rough count we can use about a month of time for each of the 3 remaining waves still to come.

 

 

Hits: 8

HDGE, All Aboard The Bandwagon Heading North!

I’m a big fan of westerns and there is no difference in riding a wild stagecoach than riding a Bandwagon that is still empty at this point. Once more people jump on this asset class is going to get over-loaded and then become prone to a crash. If I’m right we still have a long way before the stage fills up and the horses get tired. HDGE is going to meet resistance but eventually leave that in the dust. This run is far from finished as investors are in for a rough ride to put it mildly. Just like with other indices I see an expanded pattern, so a nice set of 5 waves in Minor degree should fully develop counting from the September 2018 bottom.

Hits: 5

Apple Decline Still Going Strong!

Readers may not understand any analysis done with the EWP, but wave counts that do not follow a strict sequence will never work.  Not until I switched over to Cycle degree specifications about 5 years ago did the EWP start to make sense to me. One of these special or complex corrections of an expanded pattern can also happen with single stocks. Of course, if we are not aware, or not looking for expanded patterns, our wave counts will be all over the place on the charts.

Many think that the market we are in is just a correction, but this is very misleading at best. The smartphone era is dying and saturated. Tim Cook is a late Boomer and still has many good years to go, but the older any CEO gets the less innovation and risk-taking the company takes.

With a big Apple price drop already behind us, you would figure that the Gold/AAPL ratio would get better.

I had one expensive reading of 5.27:1 on October 4th and our recent reading is 7.50:1. This is a bit better but nothing to scream out across the rooftops for.

Cheap would get us closer to a 21:1 ratio so we have a long way to go before that ever happens. I will have to adjust my smaller degree wave counts and even if my expanded top is not “real” the big correction might end up looking like a zigzag!

Hits: 6

Russell 2000, RUT Update

 

The Russell 2000 index has lost support and is one of the first indices to do so. I’m sure there will be more joining this club  but you may not hear about it until the SP500 or the DJIA does the same thing. The wave count also has an expanded top to it, which most wave analysts don’t even look for. The Cycle degree wave three top finished in January 2018, while the secondary top of August 2018 was a “B” wave top in Intermediate degree. These expanded tops are very important patterns because they also forecast the fact some time in the future this market will once again push to another new record high. If the big bear crushes RUT to below 500 then I would have great confidence in saying that RUT will exceed 1742 again.

The problem with making a forecasts way too early is that investors will think it’s going to happen soon!  A bear market is only a correction to a bigger bull market in Cycle degree. The next bull market will be a solar cycle induced 5th wave in Primary degree. Just like the majority missed the 2009 bull market so will the next group of investors. Every major wave analysts expert missed the 2009-2018 bull market because e they though a wave 1 in Primary degree just ended!

Buying into a market that is so overpriced will always burn the participants (Investors) and this time we can see it’s not any different. Of the top of my head, we may have about 5 expanded patterns in progress so it’s not just a single one shot deal.

The Gold/RUT ratio is sitting at 1.1532:1 which is expensive by any stretch of the imagination and 2.63:1 would be cheap in the world of ratios.

 

Hits: 9

SP500 Mini Intraday Update

A few days ago some analysts have declared that a bottom was in. They were very bullish but this chart would have to soar soon for the stock bulls to be in control.  I doubt anybody is in control right now but once this E-Mini SP500 chart breaks below the 2590 price level then we know that the bears are in control.  Those reporters that are still super bullish are going to find out the hard way which direction this market is going to head.

Commercial traders are net short, but not at any real extreme just yet.  There is a slim chance this 5 wave pattern I’m working, will finish by the end of this year. It may take until February or even March to clear up. We know that January can be a critical month but March has also produced some amazing reversals.  The Gold/Sp500 ratio is 2.13:1  which is still off the charts for being expensive.

Some asset classes are in a funk as some investors are still undecided.  It could take very little to get a herd into a panic.

 

 

Hits: 7

Quick Natural Gas Update

This is the January 2019 NG weekly chart and it looks nothing like the daily chart. For the last month, Natural Gas Prices were correcting after which NG prices exploded. This morning NG prices exploded again, so chances are good a small 4th wave has developed. An NG rally going into the winter/spring season is not all that strange. There is an open gap open below, which could get filled at a later date. For now, one more push to the upside would be nice. There is an LNG terminal planned in BC, and I think that is a good thing. Still, there are seasonal changes that affect the NG prices which can still drive the prices a bit higher.

I would be very bullish longer term if the commercial hedgers were net long instead of net short. They are far from being net long, which does not support a huge impending bull run at this time. NG sure is not on a 5 wave impulse run as the angle of the 2018 move has been too fast and straight. Natural Gas prices are also diagonal wave structures so you can always expect a wild ride when you least expect them.

Hits: 9

DJIA Index Update.

 

Sometimes the futures charts don’t offer any special insight. I like this index and it only moves during the day. It can take days to finish a small move and this DJIA ended on a down spike and now has roared back to life!

It may last this week but any correction in this market is far from over. The DJIA is not going to soar to the moon as it will take much more to correct the imbalances in the world. That imbalance is “Debt” and world governments are all leverage to a point they will never pay the debt off. It will be easier to default on any debt than pay it down.

The DJIA may have seen another wave 1 bottom but in Minute degree. The bearish trend is still alive and at 23,300 all support will fail. Of course, President Trump will be blamed and they are even talking impeachment proceedings.

If the markets are very expensive when we use the Gold/DJIA ratio, then I can’t be bullish for any fundamental reason.  My most expensive reading was 17.24:1, which was broken by a new record of 21:1 in early August of 2018. This morning this ratio was 19.85:1 which is better but its a far cry from being cheap. The commercials are still net long but not at any extreme, so I would also like to see those numbers reverse.

Hits: 9

HUI Bull Or Bear?

As much as we would like to see some real action in gold stocks, the HUI has done nothing but slowly grind higher. I keep wave positions on about 13 gold stock related ETFs and indices and I can produce a different wave position for each one.  The HUI bottomed in September of 2018 while I have some that just bottomed last month. There are no consistent bottoms where they all bottomed in September so rally may yet be a fake. I show what could be a wave count if any “A” wave was already completed in 2016.

This is still a bearish wave count I show but there could be only one more leg to the downside and then another fast move up. The trouble with that is if the HUI only went as high as I show, it’s not high enough to be followed by 5 waves down in Intermediate degree.

The wedge has the HUI price cornered into the cone which will force the HUI to show us it’s true colors. Gold itself has a different angle during the last 2-year bearish phase in gold stock related indices and ETFs.

The Gold/HUI ratio sits at 7.9:1 which is a cheap ratio compared to the 10:1 cheap ratio I have recorded. I would like to see the Gold/HUI ratio compress some more as it could hit 10:1 again.

I think the markets may be a bit slow during the holidays, extending the time it takes to play out into the first part of 2019.

Hits: 3

TSE Wave Count Review

 

I have always had a real problem with developing a wave count for the Canadian stock exchange. This wave count is no different and chances are good I will have to rework it many times. The ETF to the TSE is far worse as this bullish phase developed sideways. Since Canada is commodities oriented, I may have to apply the big diagonal wave count. I would need a much bigger historical database, which I haven’t found at this time. I have no Gold/TSE ratio database as I would have to start one from scratch. Today this ratio is a bit below 11.8:1 which means it takes 11.8  gold ounces to buy just one unit of the TSE.

This makes it one of the most expensive indices I follow. We also have a big wedge that should slice the bottom trend line in due time. Eventually, the TSE could fall to the 2011 lows but an intervening counter rally should start well before that price level.  The 2016 low might be a better price target for another “A” wave bottom in Primary degree, which may still take until 2019 to complete.

Hits: 1

Holiday Season Reduced Posting Notice

First, I wish all visitors to this blog the very best during this holiday season.

I will be taking downtime as well, between December, 21, and January 1, 2019. All postings will not cease but they will be sporadic.

Hits: 2

Crude Oil Intraday Gyrations Update

Are we having fun yet?  Trying to figure out where oil is going next is always a challenge but I sure don’t think that the bearish situation is completely finished just yet.  One clue is that the waves are still overlapping each other which are signs of a bearish rally still in effect.  Another thing worth mentioning is that crude oil is just below the Fibonacci number 55. This support could fail before my digital ink even dries, as a move up or even a bit above $55 could still happen.  I have to run two sets of wave counts for oil, but both of them can be the same for most of the trip.

The Gold/Oil ratio has improved a bit recently at 24:1. This is not nearly close enough to be considered extreme but it’s making progress.  The Gold/Oil ratio only got better during November and we will have to see if it is running into a price ratio brick wall.

I would turn very bullish if the commercials were in a net long position, but they are far from that which will keep oil prices from running away to the moon. The fundamentals in oil change so fast which makes them worthless as well.  Did fundamentals give you the confidence to short oil in early October 2018? The experts were calling for $100 oil at that time. The October 2018 peak was one of most lopsided trades in the world as everybody was leverage to the long side and that didn’t include any COT positions.

The crude oil Death Cross on the daily chart happened closer to the $65 range, and oil would have to rally for a very long time before it creates a Golden Cross.  All my futures contracts that I follow are shifting or have shifted, into the 2019 year.

 

Hits: 8

S&P Midcap Daily Chart Update

We have a triple bottom that is being formed this year. I doubt that the 1760 bottom will hold, as investors usually get their nickers in a twist when support fails.  Below that 1760 support their are all the sell orders being stacked up, to protect the bullish investor.  

When the protective sell stops get triggered this turns the once-bullish investors, into stock bears instantly.  Some of my updates will be on the shorter side and many of my postings will be erratic as I will take more downtime for the next 3 weeks or so.

Hits: 13

VIX Not Ready To Crash!

The bullish action of the VIX tells us that  fear is present in the markets and at this time I believe the VIX has far more room to move up.  A few big gaps opened up in December which were quickly filled or closed off.

Not until I can count out 5 waves up in Minute degree, will we get close to another correction in the VIX. The little H&S patterns being setup also adds to the VIX bullish picture. A bullish VIX means bearish stocks so investors are not getting any Santa gifts just yet. I don’t have sympathy for investors that are still trying to milk out gains at an extreme record high. It’s like playing with a hot potato. If the VIX breaks out to a new record high this week remains to be seen, as the odds of a sustained VIX decline are getting less and less. It may take the rest of the week but the VIX should charge to new record highs.

Hits: 5

Idealized Submillennium Degree Wave 3 Review

Since about 2013, I became convinced that the basic Elliott Wave Principle is just one big impulse. The idealized chart above has a wave zero start with the ending of the Little Ice Age. Yes, global cooling killed the Medieval warm period but picking an exact date is impossible as the LIA took a few hundred years along the bottom. 1500-1800 could have been the worst of it as millions of people succumbed to malnutrition and disease. 

During that time British markets carried on into North America as trade flourished. I have another idealized chart made for commodities as this chart changed into an Impulse during the Roaring 1920s.

The markets in the real world are never this steep, but it’s one of the ways to fit it on a large format paper 24 inches wide. I work connecting all Cycle degree points together first, and the arrow points to the January Cycle degree peak.

Idealized charts work like blueprints and when we try to build the Elliott Wave Tower Of Babel, without looking at the blueprints, then we are guaranteed that any wave count will always fool us and the Elliott Wave Tower Of Babel will come falling down.

When we switch the DJIA to linear settings it sure can look like the Idealized chart. If we compare the 2000 peak with modern day wave counting methods, then the majority of all wave analysts out today are a “Minimum”  of 4-degree levels higher than what my wave counts are. 



Hits: 7

TSLA Defying Gravity?

Tesla has been defying gravity far too long. It seems to be building a very flat top squeezed by a rising bottom which looks like a wedge to me.  Of course, if you are the bullish person you’re not going to be looking for any bearish signals. TSLA has defied the bears as well, but Elon Musk made the bear’s life miserable during the entire time. 

I have an open or uncapped 5th wave so technically I don’t know what wave count is next.

I do, but the only reason this 5th wave is uncapped is that I had no more editing room. I believe that TSLA has or still has to hit a Cycle degree wave 3 peak but I need more evidence in the short-term to confirm it. Tesla is all about commodities, so it stands to reason for all the choppy wave structures. In the future, I will re-work the last 2-3 years in different ways to eliminate any potential expanded top. No expanded top can mean a single zigzag while an expanded top is instantly a flat.

4 or 5 times Tesla tried to breakout and push higher, bit so far it has failed.

My Gold/TSLA database is not that large, as I have to build it from scratch. Today this ratio sits at 3.48:1 which is extreme when we use gold as money.  Most of 2018 the Gold/TSLA has been averaging between 3-5:1 which looks like TSLA has been hitting a ratio brick wall.

The cheap range of the Gold/TSLA ratio is between 60-70:1 so we have a longway to go before TSLA becomes cheap again.

Hits: 6

SPX Crash Update

I like this SPX index as an alternative to my futures charts as it might clear up some wave patterns I’m working. Any specific single month in futures can be so wild that wave positions do get very muddled. I’m not going to spend a lot of time on this chart as I just finished the DJIA which is very close to the same wave count..

They both have the same wave patterns that are very similar, with a few small differences. A run of 5 waves in Minor degree is what I’m after but at this time that could take into 2019 to finish. Any month in the first quarter will do!

I normally try to avoid inserting wave counts from other wave analysts but the above wave count has been completely blown already before the digital ink had dried. The wave 2 top did not work, and he has no clue what happened in 2018 as he left an Intermediate degree 5th wave top uncapped! About the only thing that is the same as my wave counts, is the 2018 peak. He still has 2-degree levels missing.

Elliott wave patterns are not what we think we are seeing as they are what our best visual Idealized chart is. If we don’t follow our vision of an Idealized impulse then how do we know when we are wrong?  I have two big Idealized patterns posted and the diagonal one is used for all my commodity wave counts. 

Hits: 14

DJIA Index Update

This is the DJIA index from Big Charts which shows some violent moves that have occurred in the last 2 months or so. Many of the asset classes I use also contain an expanded top. I look at some other analysts wave counts and they are oblivious to any potential expanded pattern.

If you see any wave count with any 5th wave not being capped then that wave analyst is “Clearly” telling you, ” I have no clue where we are”.  Even the expert wave analysts leave the 5th waves uncapped.

I’ll be pretty blunt in saying that in January of 2018 wave 3 in Cycle degree has completed and my expanded top pattern is still my best bet. We’re only in an Intermediate degree crash right now, but eventually, it will turn into a Primary degree crash.

I need 5 waves down in Minor degree which has a slim chance of finishing this year. The Gold/DJIA ratio today sits at 19.54, which means it takes over 19 Gold Troy ounces to buy just one unit of this DJIA index. This is only a marginal improvement in stock markets getting cheaper, but this ratio should change by the time the DJIA corrects from a Primary Degree “A” wave. 

All support will fail when the 23,400 price level gets breached and panic will ensue again.  So far, I have 2 sets of 1-2 wave counts completed and if I’m lucky I might see the third set. 3 sets of 1-2 waves will extend wave 3 very well, and the 5th wave can also do the same thing. First sets of 1-2 waves are always the shortest, if they are not then chances are good we have an “A” wave.



Hits: 8

BOTZ, Global X Robotics & Artificial Intelligence ETF Update

We can see that the January Peak at $27 is a single top all stuck out in the open. There is no expanded top here like we got on at least 5 other indices.  This January peak is the real peak which I see as wave 3 in Cycle degree. There are always three sets of simple corrections we will have to choose from and we would need a single correction in Cycle degree with 3 stages in Primary degree. It all points to a big flat in Primary degree with this single zigzag being the intro to the “A” wave in Primary degree.

I don’t think this decline can play out by the end of the year, as it may take until February-March 2019. A full set of 5 waves has to develop, and a landing at a Primary Degree “A” bottom would be a buy signal.


Hits: 3

Solar Cycle #24 Update

Some solar cycle watchers have already concluded that solar cycle #25 has already arrived. I question that assumption. Each dot above represents a single month and if we count backward, we can count 5 months when sunspot activity bottomed in July 2018.  

The problem with solar cycle #24 ending in July is that they don’t show up on the sun! New sunspots have to show up in the northern limb or the northern hemisphere of the sun. There should have been 5 months of sunspots show up in the northern hemisphere of the sun.  We can check online and look directly into the sun without burning our eyes. Spaceweather.com does a very good job of this and I clipped out a section that has only one sunspot active today, and it’s right at the equator 



The entire face of the sun is empty except for one little sunspot active near the equator of the sun. Sunspot # 2729.



2018 spotless days have been about 60% days, not yet matching the 2008 73% spotless days. 


I have to apologize if this posting doesn’t look right as they have introduced a new editor and I will have some trouble with it until I get use to it. 

Hits: 6

T-Bonds Daily Chart Bull Market Update.

 

This is just a quick update as this T-Bond chart is off and running on another bullish phase that should produce a new record high in an ongoing  37 year bull market. This bull market will not end folks as it could be on a Supercycle degree wave 3 that is far from finished. Heck if we’re lucky a wave 1 in Cycle degree is still ahead of us. Checking the T-Bonds and commercial traders positions show they are mostly all net long. This helps me to turn bullish on these T-Bond Charts. Even today we had a small spike develop, which should turn into another correction.

Hits: 5

Palladium Daily Chart Cycle Degree Peak Review.

Yesterday Dec 5, 2018, palladium spiked to the upside and then instantly reversed. I was anticipating such a move as palladium finished a new world record high at about the $1245 price level. This is only about an $8 difference from the gold price.  I believe traders are set up in another bull trap and they will panic to try and get out. You can bet that protective sells stops are piling up below the entire length of this 5th wave. Also, computer trading programs can kick in at any time.

The commercials were net short by a good margin (3.68:1) which eventually will kill any bull market. The last 5th wave in Minor degree works well as a diagonal, which is more like a joke as the entire bull market in palladium were all diagonal wave structures.

A Cycle degree wave 3 top will produce a big bear market that at this point in time, could turn into a great looking zigzag. From here on some intraday wave counting would need to be done which I do with my finger pointing at my screen. (Air Wave Counting) Also after a sufficient decline, I can print out a 90 min intraday chart and take my sweet time looking at the entire wave structure.

Since the January 2018 peak a Death Cross formed followed by a Golden Cross, so the next crossing should be another Death Cross which has a way to go before that happens. This is not going to be little correction folks, so don’t get caught in some wishful bull market that will not arrive.

The only time we may get a buy signal is when we arrive at a Primary degree “A” wave. Even a Minor degree “A” wave bottom is pretty dangerous, with an Intermediate degree “A” wave bottom only being a bit better.

 

Hits: 2

DJIA Index 2000-2018 Review

I love to make this DJIA index using a linear setting, as it shows how wild the bull market has been since that 2009 bottom.  If the younger readers think that it’s a good time to invest then they should figure out how deep this impending bear market is going to go. We are heading into a Cycle degree bear market that will not finish with a mear 20% correction! The general guideline is that markets do retrace to the previous 4th wave of one lesser degree.

How can that work when we have no real clue as to what degree level we are actually at.  The 2016 bottom was only an Intermediate degree correction so the 2016 support level will not even get us close to the previous 4th wave. At the very least, this DJIA index has to dip into the 2007 peak, but most of the time the bottom of the markets go to the lower end of that scale, which would be closer to the 7000 price level.

I would bet that the majority of all wave counts you see out today, are a minimum of 2 degrees higher than what my wave counts are.  They still think that the 1929 crash was a 4th wave crash in Supercycle degree. This makes the bull market from 1932 to 2018 a 5th wave extension!

It’s impossible for this to ever happen as there will never be multiple generations 5th wave extensions. In this case that would be a 5th wave extension lasting 86 years already! 5th waves may be technically strong but they usually are the weakest fundamentally. The bull market from 1932 should show diagonal wave structures which they don’t. It seems that wave analysts just love to talk SC and GSC degree bear markets but to be very blunt about this, we must get a very specific corrective pattern that contains a decline of 5 waves in Primary degree.

Since the 2000 peak, no wave analysts have ever confirmed 5 waves down in Primary degree, so it is mathematically impossible for the markets to be at an SC degree top already.

Supercycle degree wave 3 and GSC degree wave 3 are still far in our future. Of course, only the younger generations will run into that because the boomers are going to be out of the picture.

Flipping numbers and letters around is not an option for me as being out by one degree can mean be wrong forever.

Elliott wave is not what we think we are seeing, as it’s all about how well we can visualize the true idealized pattern. Any wave positions in the past that looks like a simple 4th wave triangle are the simple easy patterns we can see. They are also traps for the lazy wave counters that refuse to go back in history and look for wave 3 extensions.

 

 

Hits: 11

Mini SP500 Daily Chart Death Cross Update

 

With the wild moves going on in late trading this March 2019 contract charged up and then down again when the bears attacked again. This time the 50-day MA sliced across the 200-day MA which is the classic technical indicator called a Death Cross. I have a slew of Death Crosses forming and now we have another one. These Death Crosses forecast long-term declines and the Death Cross on a weekly chart is way down at the 2340 price level. My best bet is that any wave 3 decline could slice right through that price level with ease. This fast drop could have ended at my first wave 1-2 in Minute degree then I would only look for 1 more set in Minuette degree. I might need an electronic scanning microscope to see the smaller waves. If the wave three extends then even the 5th wave could extend so this bear party is not over by a long shot. Don’t blame President Trump for all the problems, as it was the Fed that took the alcohol away from the stock partygoers.

This is nothing new as I watched different Feds do the same thing twice before since the 2000 peaks. Since late January, we have 4 bottom support prices showing, and each one of them will get trashed, or rectraced. That would also confirm that from that February bottom up and down again was just part of a bear market rally.

All those misguided investors that just finished putting billions into the markets are now sitting on a Death Cross. Think of anything above the 200-day MA as a group of partygoers all standing on a porch and there are too many on the deck! When the deck legs buckle and snap, then it’s too late to do anything about it. Not too many people listen to a technical analyst, but investing blindly right before the Death Cross is strictly FOMO driven so who cares about some mythical Death Cross!

Hits: 9

HMMJ Bear Market Continues!

 

I’m sure many investors are still “High” on marijuana stocks but I think reality may be setting in for those that didn’t expect pot stocks to crash. I knew they would crash as as this new industry turn into a mania instantly.  This ETF is showing the way and today HMMJ has created another spike to the downside. A correction may come but this market decline is far from over. I think the industry also has it shares of crooks as they just love to take advantage of the emotion. Many big companies have also crashed and the only people that made any money are the ones that participated in any of the IPOs.   I will never turn bullish on this sector until all the ETFs and stocks have been crushed, and even then there is no guarantee they will go anywhere.

The wave count is more like a diagonal which is normal for anything commodities related but they are a bit smoother set of waves. Sure, the price has come down to the point where the Gold/HMMJ ratio is at about 80:1. The most expensive Gold/HMMJ ratio at one point was 49:1 in September  2018.

The dirt cheap ratio was 150:1 so we have a long way to go before this ETF turns real cheap. It may never return to the 150:1 ratio but we may catch it if it keeps heading into a ratio price brick wall.

I don’t have the time or don’t want to spend the time, tracking this ratio as I have a data base of over 28 ratios I’m already tracking. I updated most of them today while US markets were closed.

The potential start of a 5 wave run in Minor degree would match the stock markets wave count as well. I doubt that this will finish this year as it could stretch into early spring 2019.

I think many companies will disappear as margins are going to be razor thin with huge start-up costs involved as well. Then the biggest con of all is that there is a shortage of pot! Yeah right! The dispensaries in Vancouver never shut down. They’ve had their licenses for a few years already and never missed a beat waiting for the rest of Canada to wake up.

If the legal markets can’t supply inventory just yet, then the black market will always come to the rescue.

 

Hits: 3

Algorithms Caused Market Sell-Off?

  This sell-off was caused by a computer-driven ‘footrace,’ Jim Cramer says

We may think that Jim Cramer is full of BS, but he has more knowledge about how markets work and what he says is not just a bunch of hype. The speed of the sell-off on Tuesday was far too fast for humans to be part off. I see them as Algorithms being programmed to sell on certain indicators before the herd gets the same idea. These computer-driven moves will always happen and they are run by hedge funds, that can afford to create the programs in the first place. Flash Crashes work this way which has happened many times before, but they happened in a bull market when after the Flash Crash stocks always went higher. This time that trick will not work if Investor Joe/Jane starts to hate this market and refuses to hit the “Buy” button.

I guess everyone has to learn how to code Algorithms and create AI robots to do all the trading for us.

 

Hits: 3

HDGE Bear Trap Update

 

HDGE runs inversely to the stock markets so I look for the same pattern but I have to look at it as a Cycle degree 4th wave bull market. It will be the wildest bull market you can imagine if the recent bottom did complete wave 2 in Minor degree. HDGE dropped like a rock producing an insane spike to the downside and then reversed in a spectacular fashion. It’s those long spikes to the downside I like to see happen, as they are signals for a reversal or a correction. The only thing that matters now is if the rest of this 5 wave run comes in.

We know a bear trap was forming because HDGE can’t go to zero, and at the $5 price level, they tend to have an inverse stock split, which would have made the news. HDGE should develop 5 waves up in Minor degree and since there is nothing but fear involved this ETF should travel up along with VIX.

I wouldn’t be happy until HDGE goes off the chart, but there could be another 2 sets of 1-2, wave structures we may run across. We should see the next wave 1-2 when it comes, and then after that nothing but 3-4 wave structures will arrive until wave 5 in Minor degree is finished. We are going to run into 5 wave sequences and if I’m out by one degree on this run then I’m out by a Fricken mile.

From here on we should get higher lows which are all corrections. It’s also starting to become obvious that the odds of this 5 wave run finishing this year, is too optimistic as it may stretch into February/March

 

Hits: 3

HUI Gold Stock Review

 

 

For all the wild swings the markets have been making, gold stock related ETFs and indices have been acting like they don’t care. Nothing in the last month or so has fired up investors to hit the “BUY” button. What does it take?  The wedge you see will certainly tell us, as the HUI has to “Breakout” or ” Meltdown”. There is no middle ground as the only other option is for gold stocks to keep going sideways. The Gold/HUI ratio was at 8.2:1 this morning which is getting cheap but not an extreme just yet.

 

 

RING is a gold stock ETF and it looks much like the HUI does. Gold itself is fooling us because the same pattern in gold is facing up! The same wedge applies to RING which is trapped in the “Cone” of the wedge.  I have no large database of Gold/Ring ratios but this morning the Gold/Ring Ratio is at 80.9:1. HUI and RING look like twins, but other ETFs are much lower.  Some Canadian ETFs have had new lows a week or so ago. RING had about a 49% drop from its peak, while the HUI had dropped about 52%.

I would love to go long but there are still too many bulls around for my liking. Next time I will post some of the worst gold stock ETFs that are near to hitting new all-time record lows.

 

 

Hits: 3