With so many potential death crosses out there, I’m starting to feel like the Grim Reaper. With stocks the 50-200 day SMA lines may act a little different than how they do in commodities. I’m sure the markets are waiting for some good fundamantal news, becuase if they don’t then the majority of sell stops below could get triggered. It won’t take much as the bullish herd is starting to get very skittish. Bears always attack from the top down and the big claw came down at the end of January. A big bear market is coming which very few have any idea how deep and long the bear market will take.
The two SMA lines give us another clue that stock markets are heading down in a griding summer decline, which may end at the traditional September-October months. The last Golden Cross happened way back at the 2011 crash around the 2200 price level. That is far to late to be any use at all, as they are lagging indicators. Counting the crossings, the next crossing should be a Death Cross, which will show up first on most daily charts.
The longer this market goes sideways the sooner the top 50 day SMA line will slice through the 200 day line. You don’t want to be anywhere in long positions when faced with a potential Death Cross. Since everyone has an investor mentality those that know how to play the markets down will be winners this summer. The Buy&Hold strategy is coming to an end, in a bear market. Stocks are going to “deflate” and even gold will deflate with a $500 crash. Very few asset classes will stand up to such a big onslaught of selling, but in reality the buyers might want to stay away from investing altogether.
I have to keep my options open but a big flat in Cycle degree is still the pattern that I’m after. This could take three years as solar cycle #24 draws to an end and solar cycle #25 begins. I believe a very serious recession is coming which will bring out all the depression fears. Every single degree that we go higher means that bigger crashes will come.
Gold is going to make some wild moves until 2021, as the markets and gold are heading down to the same “A” wave bottom in Primary degree. Wealth destruction is money distruction, which is inflation in reverse. $100 trillion dollars could vanish into thin air, which is very bearish for gold. That’s about a third of all world assets disapearing. The numbers may vary from others but I think readers will get the picture.
If the markets gyrate around another month or so, then I would be inclined to think we are at the top of “B” wave crash and not a wave 2 top. A long drawn out tail of a market decline could happen. The Nasdaq elephant is probably holding everything up. If investors don’t feed the elephant with “greens” (money), it will collapse for the lack of sugar and crush all the stock bull cowboys in the fall.