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Wednesday, September 7, 2022

Market Update 9/7/2022 - Monday Morning Surprise is Postponed Until Tuesday?

It kind of worked out well for me to get it wrong yesterday, but after seeing futures up for 2 days in a row, I expected the market to rally without me, on Tuesday. Instead we saw a retest of last weeks lows, and the little shakeout, I was hoping for.    

NASDAQ - retests a key Fibonacci level (a 61.8% retracement aka The Golden Mean) 

I don't know if we're going to be off to the races here, and I have my doubts, but I think we can't continue to retest my lower channel forever either. 

Lame Stream Media Reports 

  1. If I have to hear "7 day losing streak", reported - by the Lame Stream Media one more time, I think I'm going to go nuts. But this is what the idiots in the MSM are reporting, as if 7 red days in a row (for the NASDAQ) is some kind of record?! "...The longest losing streak 5 years"! Must be a slow news day, to be reporting such meaningless stats!   
  2. No more white men leading the British government - yes the idiots in the deep state must be very proud this overtly racist headline - U.K. Prime Minister Truss' cabinet is first without white men in top job - axios - after running Boris Johnson out of town 
  3. Bitcoin Crash - Considering that Bitcoin was recently trading at 20K again, this isn't a crash. It's just more fake news, and probably wishful thinking, since crypto is a threat to the petrodollar. 
  4. Short sellers return - this is some good intel, and helps me understand what's really going on in the market, and 1 out of 4 ain't bad!  

I usually like to watch with the sound off, but that's not always an option, and every once in a while you'll get some good intel, watching the fake news. 

The Technicals 

The $VIX - I was impressed that the short-sellers were able to drive the $VIX to a new recent high, on yesterday's little shakeout, but this retest of the $VIX high, doesn't look like a bearish move. Without getting too technical, it looks like a zig-zag pattern, which, if you know anything about EW chart patterns, is not an impulse wave.   

What does this mean? One thing it could mean is that we're going to continue to build some kind of base. Second thing it could mean, is that we already built a base, and yesterday's retest was simply an overshoot, or a head-fake. 

Update on Financials - continues to look like wave "A", in a little pullback. Did you buy the dips? 

Natural Gas - the short sellers return from vacation

If you missed yesterday's market update, it's a fascinating study in triangle patterns, and I may even include it in the book.... 

In Hindsight, looks like retail (investors) have been the only ones buying NatGas for the past Month, and possibly longer, when short sellers covered their positions all the way back in June - ahead of the 4th of July holiday. Now at least a few hedge funds have returned, and increased their short bets.  

Second option is that, "the powers that be", quickly figured out, over the weekend, that Russian traders were releasing fake news, in order to drive NatGas markets higher, and they nipped that in the bud. 

For whatever reason... Natural Gas broke key support, tumbling over 10%, and short sellers were seen taking profits at the 50 day moving average. 

From here we could see a gap fill, but once a commodities chart breaks, it usually continues to shake every weak hand, and if I'm proven correct that this is a powerful wave c, then that's exactly what I would expect to see. 

If I'm wrong, and this turns out just to be another pullback in a topping pattern, then we won't see NatGas continue to gap down.... slicing though all support, along the way, because this is how you can differentiate a powerful wave c, from something else. Instead. the selling will dry up, and it'll build a base. Time will tell... 

Good Luck, AA 

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