Thursday, February 13, 2020

Market Update Thursday 1/13/2020 - Which Came First The Chicken Or The Egg

This morning I could go on and on how I was right 4 - 5 more times going into today's trading session, and lately it's hard to keep track....

I used to think being right once a day was the goal, but it's better to have several oars in the water. I think this, in part, is why day traders have such a hard time... because they're putting all their eggs in one basket, trading the $SPX, or the $DAX, or Gold, or whatever, and that means you're not diversified, but you're also only looking at one part of the market. Once you can handle 3, or more trades at once, the chance of winning are in your favor.
For instance: If you're Oil chart points to a breakout, or Natural Gas.... and the the Russia chart, or Dubai confirms it, that adds a lot of weight to your prediction. Here's another example: A breakout in Deutsche Bank would point to a recovery in the European banking sector, right? Everyone knows $DB presents a huge risk to the global banking sector, who charts it? One of my mantras is to "Chart everything".

 If I don't toot my own horn, nobody else is going to.... so let's document yesterday's calls:

  1. Yesterday's Oil target (see yesterday's blog).
  2. The $VIX was seen already trying to take out my target ("")

          4. The reversal in Chinese markets.

The begs the question:

Which Came First The Chicken Or The Egg? 

"Chicken-and-egg" is a metaphoric adjective describing situations where it is not clear which of two events should be considered the cause and which should be considered the effect..."  Wikipedia

In this case of which came first...: 

Do the charts predict the future, or is news released at certain times in order to drive markets, wherever the, "power's that be", (the corporate banking interests who also own every news outlet) like? See: These 6 Corporations Control 90% Of The Media In America businessinsider 

The catalyst for this pullback was the new Coronavirus numbers, and I was watching in real time, as futures went from the $SPX being up 2 handles - precisely at my red line, to blood red, in only a matter of seconds. See the tweets above with chart attached.  

It's impossible for me to know China is going to release bad news, at a certain time, but insiders knew those numbers were coming, and sold into it, going into yesterday's close. Why would they do that? In order to force market participants to buy protection ahead of Weekly OPEX, tomorrow, and monthly OPEX next Friday. As I mentioned in yesterday's blog, every market move revolves around Options Expiration dates, and market sentiment going into (ahead of) those dates. Yesterday we saw the market become overly bullish, and this morning we're seeing a little give back.

The first cluster of highly contagious Coronavirus cases were being reported as early as Dec 8th, 2019, and it wasn't until it became viral (no pun intended) on social media, and the main steam media started reporting on it, that we saw bearish market sentiment peak out around 2 weeks ago, when we saw futures down 350 DOW points. Ever since then the market has continued straight up, and those who trust the news for their information, can't believe it, but this was very predictable, based on the sentiment reversal.... in the face of bearish news. This why I'll trust my sentiment indicators, over whatever is being reported, any day of the week.

If the Chicken (the charts) came first, and the news reports (the egg) come second, then you could say "the charts predict the future", but if the egg/ News was already being hatched, then the charts only predict the news, and more importantly the emotional reaction to that news, because in theory, this is more important than the news itself.

It's impossible for me to convince investors/traders, who are scared out of their wits, over this coronavirus outbreak, to ignore their fear, and "don't fight the trend". They'll have to learn to get past their emotional barriers, at their own pace.

The best example I can give of this chicken and egg theory is the irrational fear that was created by the main stream media, of a Trump win, in the 2016 election. They claimed the market would "crash". I predicted that Trump win, and the charts pointed to a crash in market futures on election night, and I called that panic, "a gift",
 and the market rallied the very next morning, like nothing had happened. I can't tell you exactly what percentage the market is up since Trump took office, but it's up a lot!

Don't let irrational fear get the best of you.

AA    
















Wednesday, February 12, 2020

Market Update 2/12/2020 - Oil, NASDAQ, Russia, Coronavirus

I should be busy updating the charts this morning, and switching out the short term charts in the public charts area, but I thought I better do an update. Multi-tasking

The 1 min. chart has kept me on track over the past couple day's, and the 10 min. chart is working again, after yesterday's little pullback, but I'm also charting Oil, and energy, not to mention Russia, and Biotech, and the $VIX, and everything else it takes to be right every day. It's a tall order; 16 hr days. Thanks for your support.

To review the action of the past few days: The trend continues. $VIX remains contained (#NoFear).

$SPX  1 min chart


$SPX 10 min chart - Pulled back into support going into yesterday's close, as the $VIX rallied off my "$VIX ALERT". Still the $VIX remains relatively low

I think yesterday's pullback could be enough to keep the bears trapped until at least Tuesday of next week, and possibly going into OPEX is Friday, with the $VIX going as low 13.50! From there, I think we'll see the $VIX fill the gap left behind at the 18 level.

Oil

The best call of the week, was yesterday's reversal in Oil, and of course Russia reversed as well.

What makes that call so incredible is what I made that call the day before.



I think the 3X Russia Bull can at least fill the gap, that was left behind last week around $75.


Technically the trend on Oil remains down, so watch this target on the Bloomberg 2X Oil fund $UCO. Looks like 14.35. I'm thinking it may still need to build a base, and the Oil bulls should remain trapped going into OPEX. Everything revolves around OPEX.

 Sentiment remains pretty bearish on #coronavirus fears, but it hasn't spread into the Europe, or the US, and I think there's a good chance we're seeing money flow out of Asia, and into the US. Coronavirus is only suppose to shave .01% - .02% off of 2020 growth estimates. That could change, but that's where we are today.

Bearish sentiment doesn't move markets, money does.

I'm going to add some DCS charts to the Public charts area.

The NASDAQ is on a tear, and the target on the $NDX looks like 9700.



No doubt the NASDAQ is going to take out the 10k level. It's just a matter of how soon? May is selling season, so I think before then.


The Dow: Looks like the chart was repaired after last Friday's bear trap, but if this channel (in black), breaks you should know what to do. Support looks like 29,300, and you know it's going to 30k.


I'll have to draw up a new $SPX chart to match.... or add this 60 min. view.

$SPX 60 min. - Trend remains up of course


Watch those updated in the Public charts area. You can find a link to those live charts, in the left hand side menu, and a legend to help you understand my charts, on the Chart Legend TAB at the top of this page. So much more, I'd like to add, but I'm outta time.

Good luck, AA

Thursday, February 6, 2020

Market Update Thursday 2/6/2020 - Wall Street Get's It Wrong Again!

Today, we're going to take another look at Tesla, and how Wall Street Money Managers totally got it wrong, and carry that theme into this ridiculous 3 day rally.

I blogged on Tesla a few days ago, just as it went parabolic, and that trend continues up until, just before the close on Tuesday, where it gave back $100 in the final minutes of trading. This was the day I decided to go to a 1 min. chart, in order to see what that looked like, and when that chart broke, it really broke!



How weird is it that the same day I go to a 1 min. chart, I'm able capture the crash in real time? I wasn't watching this chart when it broke, and unless you already had your sell-order in - just below the 940 level, you miss the boat anyhow. I call this a crash, but it was really more of a washout, to support, as I tweeted this morning.

 CNBC didn't ever report on the Tesla Crash, but then a day later - after they run 2 bearish stories - they're reporting that Tesla is trading in a "bear market", and this when it's still up 18% for the week.
Again I gotta wonder what's really going on behind the scenes, at the financial Fake News networks. Who owns then, and who is really being helped, by their ridiculous reporting? 

Today we see Tesla trading around the same level, it was a few days ago, when I started warning people not chase it, and even to to add to their shorts. Granted it's not easy coming in and selling 10-20% daily moves to the upside, but any fool should know that a parabolic move in Tesla - in which it's valuation surpasses McDonald's - is not going to last.

I was watching Bloomberg this morning, and learned it was actually professional Money Managers chasing that parabolic rally! How dumb is this new generation of investors?! I suppose this helps explain why this market continues to hold up 12 years after it started, as well as the panic buying we've seen over the past 3 days. 1000 point rally on the Dow, in 3 days, seems a little ridiculous.

Now, I've spent way too much time on Tesla, but it's another good example of how Wall Street gets it wrong, all the time, and another reason not to trust this market. 

This rally has extended farther, and rallied faster than even the wave "C" target I set in the previous blog. I think part of that is short covering, and maybe Asian investors moving their money into the US, and Europe? But this was an east bottom to call, and money gets put to work on the 1st Monday of the month.

The $VIX remains elevated, and ports being shut down over this coronavirus situation, and an overshoot to the upside doesn't make me more bullish, going into next week. Seems like the PTB like to take profits on Friday, and Monday, knowing the short sellers won't want to get short?

Risk Off

So far we're only seen risk priced into commodities markets, while the NASDAQ is trading at all time highs. This divergence scares me, and reminds me of the Hindenburg Omen, which is a situation where you have many stocks trading at all time lows, and too many stocks trading at all time highs, and a sudden re-balancing can occur.

I'm out of time. I spent at least an hour updating 23 Dow charts this morning, and this is just one of them.

$DJIA  



Market looks pivotal here. You can follow my charts, and market alerts on my twitter page, and the public charts area. Find the links. Thanks for your support.
Later,
AA



Monday, February 3, 2020

Market Update 2/3/2020 - Rallying Off Friday's Revised Target

I only have a half hour, before the opening bell rings, but the charts continue to work like a charm.

Friday the market sold off further than expected, but I was able to come up with a downside target early on.

$SPX pattern identified 11 AM Friday morning: Down-turned triangle pattern (seen in blue). This is the chart from my public charts area. Find the link to the public charts in the side menu


Of course my call after taking out that target, going into Friday's close was to reverse to the upside, which we're already seeing in futures markets.




 The $VIX was sold at 19.99 on Friday - no coincidence! - so the bulls are still in control.

 As I blogged last week, I've never seen the $VIX close at the highs of the month, ever, and this information alone is worth the price of admission.


CNBC claims the market closed down for 2020, but that's simply not true, and they fail to even mention the $SPX bounced off key supports at the 50 day moving average.

Bloomberg felt it was necessary to claim that "damage has been done to the ($SOX) chart, when the person who does the charting over there, can't even draw a proper trend line.

$SOX also bounced off the 50 day, and a key FIB target, and this isn't obvious to the woman who calls herself the@TheChartress? Smells like a bear trap, propagated by the financial fake news, because the alternative explanation is that these people are totally incompetent! 

I've added a couple $SOX charts to the public area, on Friday, and I think you'll get the most bang for your buck in 3X leveraged bull SOXL. 

Continue to watch my twitter page, for up to the minute technical charts, and analysis. Following me at twitter isn't enough, as I pointed to in the previous 2 blogs; you have to look at my page in order to review all the tweets....

Good Luck this week
AA