Friday, March 13, 2020

Market Update 3/13/2020 - Friday The 13th - Charts FUBAR

I haven't had time to do and update, for a while, for obvious reasons. Global markets have been crashing for several weeks   several support levels were taken out over the past 2-3 weeks. This destroyed the upturned bullish channel we've been relying on for the past 12 years, and I continue to delete hundreds of broken charts. To make things even more difficult, I accidentally changed the timeline settings on more than 1 of my long term chart folders, and this left many charts FUBAR!

This morning we're seeing a sentiment change. It could be that the, "powers that be", figure they better dress the windows ahead of the end of the first quarter, to avoid massive redemption's in April, and what better time for a short squeeze than a week before options expiration. There's all the catalyst - for a rally - you need. Don't try to ague with yourself that markets can't rally, on bad news, they do this all the time.

Reminder: Money, and sentiment, moves markets, not bearish tweets. It's time to put the negativity out of your mind.

Now that everyone is bearish, and a massive number of retail investors/ traders are short this market, it's time for a short squeeze, that I think could easily carry us into July.

This is the fastest downside velocity - in a 3 week period - coming off an all time high, in market history. This isn't normal. It may have been planned for a very long time, and the pandemic is being used as an excuse to take down global markets, which were already weak, but for every over-reaction, is an equal and opposite reaction. 

The Economic collapse is being priced into US equities:  

The US the consumer was supposed to carry the economy. Well, now the consumer is cancelling everything, and wondering if they'll have a job next month, and one top of all that, Russia is trying to destroy the US Fracking industry, by continuing their so called "oil war". That story is old; but the coronavirus story was just one more reason for the market to over-react.

Oil:

See where this "Oil Price War", story originated: Moscow


In case you think I'm taking the coronavirus lightly: 

I predicted only a few months ago, that a black swan would emerge, which may cancel the elections, and lead to massive civil unrest.

See: Coronavirus much much worse than Ebola 




It's not that Ebola is that deadly, but it spreads rapidly, and that means that it will overload the healthcare system. 20% of infected people end up in the hospital, and there just aren't enough hospital beds.

As we've already seeing in China, and Italy, we will probably, see several large cities in the US, including my home town, Chicago, locked down. This will lead to a panic, and empty store shelves, as we've already seen some hoarding.

I refuse to fight crowds at the grocery store during a panic, and if need be, I can last several months, on what I already have. I've been preparing for this moment for a long time, but once the news cycle changes, and store shelves are replenished, I'd like to make some final preparations.

Imagine being locked in your house for several months, without work. are you well prepared?

Coronavirus is going to be with us for a while, but as long as markets remain open, and the volatility remains high it should offer some excellent trading opportunities.

$SPX

I'm seeing a megaphone pattern, with a 3100 target on the $SPX, by July. This a pattern 99% of technicians aren't familiar with. Most are still looking for a bullish channel, which is utterly ridiculous. 




Another possibility is a much bigger crash around the Summer break.



If these charts break, then I'll be back to square one.

I'll be updating the charts in the public charts area shortly, and because volatility is so high, only daily candlestick charts, or longer time-frame.

Follow my twitter page for real time market alerts, and watch me block the fools who dare pester me in the morning, talk up their own book, and otherwise troll me. I don't mind questions, but I'm not on twitter to hold new traders hands, and teach common sense. Read the Twitter warning in the chart legend (tab).   

Thanks for your support
AA





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