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Thursday, March 18, 2021

Market Update ahead of March OPEX - 3/18/2021

 "OPEX" is short for Options expiration, and that's tomorrow, Friday.

I've been super-busy over the past couple weeks, and no time to blog, but the market has continued to hold up over the past few weeks, and retesting the highs, just as I predicted (in the past several updates). It could continue to hold up going into the holidays (Passover & Easter), considering that the pro short sellers know better than to short a dull market, but regardless of when the market is sold - now or in May - I'm not liking this DOW 33,000 level, and there's a good chance we see window dressing come down, and a mad dash for the exits, some time within the next 3 weeks.  

The DOW chart: Technical, and psychological support at 30k ( seen at the lower end of the broadening triangle  pattern (in black), and that would look like a bullish 10% pullback to most investors, and bring buyers in. Could look like a summer rally, but it's too soon to predict timelines. There's also more obvious support at the 29.6 level (the Feb. 2020 high), and a gap fill target at 28,500.

I'm having a little trouble lining up the $SPX chart the DOW targets but there's Feb 2020 support @ 3393, and more support at 3300. 

The catalyst:

Considering how bullish everyone is on the housing market, and commodities, and the capitulation patterns, I'm seeing in those charts, I'd expect crash there. If China refuses to deal with the Biden administration, than that could be the catalyst, for a lot of broken promises.  

I'm talking about this massive broadening top on the #XHB Home Builders ETF: 

You can see the same broadening top pattern on the high beta chart below. 

But the most massive broadening top of all can be found on the Global Dow chart, and EEM. You should recognize it as a massive wave B triangle, which would mean that all the Fed easing, and monetary manipulation has done nothing to solve the financial crisis which started, even before, the crooked Clinton administration, and the crooked Republicans (who controlled congress at the time),  did away with the Glass Steagall act. The Fed had been pushing for this (deregulation) for some time, and even today you see the deceptively named Fed playing politics. They wanted fiscal stimulus, and this was all the excuse congress needed to spend another $1.9 trillion on social programs, and bailouts, and there's no doubt in my mind, this money will never be paid back.   

Read: "Mr. Weill Goes to Washington" 


Global DOW: Looks like the next crash into what I would call a "super-cycle" wave C, is going to look like 2008, all over again. A "double dip", if you will.  

Wave E reversals are violent, and wave C's are very powerful, so the reversal should be easy to confirm. 

Have a great holiday, if I don't talk to you again before then. 

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