Folks … can’t objectively say what “it” is but something is afoot at the circle K …
Whatever it is or isn’t we do have a pretty good line in the sand.
The chart above is “log scale” … take a look at:
Measured move PERCENTAGE CORRECTION (red arrow)
Percentage ABCD (blue arrows)
Trend line
Multiple ratios …
Let’s call that level our line in sand. If we take the chart and make it “normal” scaling that level is important and maybe a little lower. Watch that .786 retracement level!
Today, monitor and watch – CLOSELY the BUY PATTERN on the US Dollar Index. That level is in/around 102.50-102.70. As you can see below, I have INVERTED the NYSE Index to give a flavor for the pivots in the equities and how they correspond to the US Dollar.
From the perspective of the S&P 500, let’s see what happens at the opening … if we take out the 3956 handle then moves to the upper two targets shown below are realistic …
I am using UNG as a proxy for Natural Gas futures.
Here’s the picture on Nat Gas (hourly) continuous futures:
As you can see, we are about to hit or have hit some very important support. An ABCD, 1.27 extension and the .786. We are still “well above” the very important cycle low we ID’d above. From the futures perspective, my thesis still stands that we are, potentially, at a VERY major low for Natural Gas for years to come.
That picture is a little bit more murkier when we look at UNG:
It would be nice to keep UNG above 7.00 … the KEY to this entire pattern is the Natural Gas Futures. Remember, we are looking at a near perfect MONTHLY pattern that has been exact in PRICE and TIME.
And, as I have said, multiple times in the blogs above – the thesis is wrong or on thing ice w/ a WEEKLY close below the lows.
Perspective … we made a higher low today. Let’ that sink in …
Now, my stance is to remain bearish and I do believe we are in the very early stages of a smashing wave 3 and, add fuel to the fire, it’s a “3rd of a 3rd” wave down. Wonderful …
Near term, the market DID NOT go up to our target up around 3956 but it did smack right into the trendline giving us the polarity principle.
Two scenarios:
Bounce not complete and we gap up and above or move strongly into and thru the gap shown and finish the a-b-c sequence
We did a “minor” wave 1 down and finished a “minor” wave 2 and down we go … wouldn’t be surprised to see if it closes the gap tomorrow on the open and then down …
As expected we are rallying after completing 5 waves. If you take a peak at the (2) around 4077 that is the beginning of the wave that we are retracing. Take note, we could go all the way up to that level and still fail and the count would be valid.
Also, take note that this is only a 15 minute chart .. I’m down on a lower timeframe because I feel confident in the “big 2” at 4196 is a correct label so I’m “down in the weeds” trying to ascertain where this bounce will stall and then start back down.
My bias remains bearish and I see this as a short term bounce that needs to be shorted.
First level to take a crack at it is 3957:
ABCD – dashed red arrows
ABCD slams right into “measured move” (red triangle)
So here’s the deal folks, I had NO IDEA that there was a banking crisis brewing when I put the GART SELL on the banks – it’s just a pattern. And, guess what, I’m trying NOT to pay attention to the ongoing machinations of the Federal Reserve, or some Twitter expert, or my buddy. I’m just looking at the CHART. In that PRICE and TIME we have the ENTIRE STORY UNFOLDING WITHOUT BIAS AND, FRANKLY, WITHOUT A CARE.
Every emotion, every thought, every decision, every hope and every dream is shown in the candle. Period. Dot. End of sentence.
The update above found a rather important support zone. Important, as my long time readers will understand, means a LOT of math comes together and its “logical” that a bounce or support is found. Cough Cough … sliced thru it without a care.
As we used to talk about flying fighters … (man I miss those days sometimes) .. the “goods” and the “others” so in the realm of that – when we slice thru that important of a support zone. I’ll use what I used back when I started this bank blog (unknowingly in the midst of one of the biggest banking failures ever) – something ain’t right at the circle K.
At this time, I AM NOT advocating to BUY the BANKS. I’m just looking for support as this things falls out of the sky.
From the last post, you can see that we have taken out the “largest measured move” correction (the 2020 COVID scare) since 2009. I’ve updated the TIME and PRICE of the largest correction on the chart during 2007-2009. The price is 45.90 and the TIME is out to early next year. (just putting the last one in perspective).
Tomorrow, 78.26 is important (1.618 extension) but it sure looks like it wants to get down to the high 60’s or the abcd around 60.
Of course we will have machinations up and down but … that’s some serious liquidation folks.
That gap down was a bummer … but, we have found support and bounced nicely. As you can see above, any move higher will run into the wall of China above (big gap) and probably fail the first or second time. But, obviously, we want it to close up and above that entire area so that is the immediate resistance.
The “ideal” PATTERN we would like is the a-b-c EWT corrective sequence that will set up a GART BUY.
You know I don’t like to do the “could have would have should have” but there is some nice little coloring techniques/tricks in the chart above so let’s take a peak.
First thing is to note the ABCD (blue arrows) into the low .. then, we have both a .707 and .786 retracement level with a 1.618 extension. I also (which I like to do, alot) extended off the last low before the march to the high and that was a nice ratio from the equal octave scale of music : 1.3348. Then, one last, take note of the “gap area” because that defined the measured moves into the low. No kidding … then, those orange measured moves set up what? A three drives to a bottom BUY pattern. (blue triangles).
The support/rally that was found today by the market was “expected” as we could see 5 waves down.
Now the BIG question is was the high today the end of the wave 2 or do we rally once more. I would like to see another rally so we can PROJECT the upcoming POTENTIAL inflection point.
Note, the 2 arrows show IMPORTANT support of the emini if the pattern fails.
Expect a rally the next couple days …perhaps a slight gap down but eventually support and then a rally should occur. Futures tonight are already providing that “commentary” so I’d expect a larger than “normal” rally due to the world is coming unglued (it is) but you know what I’m saying … “everyone” expected a blood bath tonight when the futures opened.
5 waves down complete … expect a rally into the circled area “to start” .. why “to start” – well – I would expect a large rally tomorrow if everyone has been told everything is OK and that circled area is the area of the 4th wave of a lesser degree so that’s an initial target.
But, as I typed below on the chart – the entire rally from (2) or 4080’s can be retraced and this count remains valid.
So, I’m guilty as charged in thinking this is an “easy” trade I’m shorting the market because it’s all going to come unglued !!!! TAKE THAT and you wake up and the entire thing has slammed against you. Been there done that and ..don’t everyone want to be there again.
Taking the banks and all the real stuff that are important away … Folks looks like we just completed wave 1 down of the “c’ Wave or Wave III (not sure one it is yet) and therefore a rather large rally could happen. WE WANT TO BE SHORT AT THE END OF THIS RALLY!
Hope the rally comes and it’s real and my count is completely wrong … hope is a strategy, you know?
Very important support comes in for GS a little lower in/around the 320’s and then 300’s. We lose those levels then expect GS to breathe down to a VERY NICE BUY PATTERN from 243-247.
That buy PATTERN is a classic.
ABCD, .618 retrace, 1.27 extension and then the “crossover” structure .. dare I say, it’s a near perfect set up.
Which, like I always mention … can and does fail so that is the line in the sand for GS and, potentially, the entire banking system. (?)
I try to make it clear on the chart below that I just “don’t have a clue” if the ATH on the S&P 500 is THE HIGH or A HIGH … I don’t have the data and, frankly, I’ve seen very amazing professionals say it is THE HIGH and also say A HIGH. Both, totally possible. NOBODY KNOWS except the Architect !!!
With that backdrop, you can see that this chart is a “bullish conclusion” of this correction and support shall be found and off we go.
I would hold my powder dry to go long … remember, in this case we have a 3rd wave of the C wave starting and that’s UGLY so we’ll have plenty of time to get long and, as you can see, using our measured moves you can see we have a nice thumping coming lower.
So, there we have 3232ish level w/ 4 ratio’s and a little higher a 3 drives to a bottom (orange arrows) and the percentage decline from 2020. the 2950 ish is our ABCD (black arrows) and a nice overlap of .618 and .5 from the 2009 low.
One of those two should hold … and then, guess we’ll just have to wait and see. I’m not really looking forward to that …
One of these amazing professionals will be proven correct and they both have the guts to make “the call” … my call will be 1/ trying to get short into the zone shown (I’ve been stopped out twice trying to short this market but my analysis has been spot on … yup.) and then 2/ stepping up to BUY to test the “trend is your friend till it ends” thesis.
If our levels work, then were long for a multi year run into new highs.
If they get blown thru and fail either like a hot knife thru butter or provide some support but then, after a week or so, are taken out THEN things are really in the “other” category of the good/other grade category.
Here is the Banking Index PATTERN that we needed to watch and monitor. Folks, banks are everything. PERIOD. They lead us UP and they lead us DOWN. Something isn’t right at the circle K.
All things being equal, the wave that started today needs to finish 5 waves so I would step aside and let the banks pave the way … the BIG support is 83-86. Why? The red arrow is the largest price correction in the banking index since 2009. What happens at that level will be very key.
Next levels are the measured move down around 56-60 and the BIG ONE at 45-46.
Note, measured move correction takes us down another 10 bucks .. that multi-year bearish divergence has me exercising CAUTION before adding or buying any JNJ at these levels.
Let’s see what happens at 142 and the key trend line …
The move off the low down around 100 has been EXTREMELY powerful and that “USUALLY” (note quotes and all CAPS) lends to another LONG entry in/around the .382.
We have a LOT of math coming in from 170-175:
6 ratios
1.618 abcd
fundamental frequency target
abcd (blue arrows)
so, it appears we need to give the 170-175 BUY a shot. don’t get married to it … perhaps go in smaller than the 100 level but this is a “first chance” and from a “holding” mindset IF (always the BIG IF) my count is correct we are moving to new highs in TSLA … TBD and only TIME will tell.
A case can be made for a 100+ year triangle is complete and inflation, while pulling back now, has begun a bull market? Yes, I know that sounds crazy .. but, either way, would hate to see a close above the that upper down sloping trend line …
The credit markets are a very important measure to monitor/watch w/ regard to equity volatility and strength. A correlation exists where deterioration w/in the Junk Bond market usually leads to or portends to weakness in the equity market and/or an increase in volatility.
We have a VERY important pattern appearing on the hourly JNK BOND ETF chart below … it’s a “near perfect” Gartley Sell Pattern. The two red arrows are showing the expected levels for resistance and, quite possibly, the beginning of the next leg down in JNK BONDS. If we get a strong close above the 93.71 level then I would consider this PATTERN FAILED. Above the old high at 94.84 and I suspect a strong and continued rally in equities.
This is one of those big flashing lights to monitor over the coming week …
Relative strength REALLY helps us understand the institutional flow …using basic numerator / denominator we place one security over another (it can be anything liquidly traded) and if the chart goes UP the NUMERATOR is “stronger” from a relative strength perspective and if the chart goes DOWN then the DENOMINATOR is “stronger” from a relative strength perspective.
Now, if entire market is being liquidated and the “relative strength” chart is going UP it probably means the denominator is really getting smoked and the numerator might be just getting flesh wounds. It doesn’t mean it won’t go up or go down .. it might not go up or down as fast or as slow as what its being compared to …
I like it because it helps me look for strength … IBM is showing an interesting relative strength chart:
Looks like we have some “measured moves” above … shocking, I know. As you can see, we have a nice harmonic in the red “down” arrows and, just for fun, wanted to show you the harmony pretty much across the board.
IBM, from a relative strength perspective certainly looks like it could have put in a low against the DOW. And, guess what, on a lower daily timeframe we have a PERFECT BUY PATTERN present:
Note, this BUY PATTERN lands right on top of a pretty big gap area so I do think it “should” (doesn’t mean it will !!!) offer support and a continuation of IBM’s outperforming the DOW. What happens when this occurs:
As you can see, when the ratio bottoms (makes sense) IBM goes UP UP and away …note, the BIG “liquidating” drop in the IBM/DJIA average didn’t have the same slope on the price chart. It went down, yes, but it wasn’t a knife falling. This is an example from the last pargraph.
So, here’s the chart from a while ago:
Couple takeaways, before the BIG PATTERN hit another had failed. We never know which ones work and which ones don’t … it’s all probability folks. Trust me, when you have two or three fail in a row after you have used a TON of tools and hours coming up w/ a level and then the next one appears you do have your doubts but TRADE WHAT YOU SEE NOT WHAT YOU THINK! Anyhoo .. the lower “bigger” pattern worked nicely! See “buy pattern complete” to the left below.
Now, as you can see we have interesting technical issues occurring:
Stair Steps: not a swing low has been broken on the way up .. higher lows. Michael Jenkins (www.stockcyclesforecast.com) taught me that 1-2 swing lows broken is “ok” but if a 3rd is broken, get the hell out … this coming correction will, maybe (?) test the swing low around 115. We’ll see ..
Since the low back in early 2020, the corrections have been, pretty much, the red triangles. I’m using a triangle to show the “price” and “time” component of the corrections and “red” because it’s going down. See how that works! LOLOLOLOL. If (and it is THE big IF) we continue w/ this rhythm then the next buy isn’t until May’ish 2023. We have time …
From the high … it is certainly “easy” (relative I know) to count 5 waves down so expect a “bounce” to occur and then one more wave down to buy. I can see that taking us into the May timeframe. Yeah?
So, it is going to be very important to watch the BUY pattern on the ratio and then compare where we are after we done a “bounce up-down” wave and then take a peak at the TIME (May perhaps) and IBM might be ready for the next leg higher.
Measured Moves are the most underutilized YET most POWERFUL tool in our toolbox. I think people don’t use them because they clutter their charts w/ lagging, coincident indicators … moving averages, bollinger bands, oscillators, and 1000’s of other tools. Do they work? SURE .. but, just think about it, ALL of the techniques and tools we use as chartists (even the esoteric stuff) is all contained in what? THE MEASURED MOVE.
This measured move is so nice BECAUSE it’s EXACT in both PRICE and TIME.
Add that to the count shown and the PATTERN present we have a very high probability trade. Right now, we are only risking a dollar. Trust me, we have time get into this move but the longer you wait, the more your risk will increase.
This analysis is wrong and would stop out with a WEEKLY close below 7.00.
Other “proxies” are showing amazing measured move synergy … in this case, from a percentage perspective using log scale.
note, added the measured move (mm) + .618*mm to equal first leg down
Here is the “final” count I’m going w/ in regard to UNG.
Let’s add this up …
Futures contract measured move – exact from a MONTHLY SCALE
UNG and BOIL percentage measured moves – exact
The 1.68179 extension hit after 233 calendar days … a Fibonacci harmonic
ABCD hit as the same TIME the extension pattern hit
The “count” on the way up violates no rules …
Note, because the all time low clearly went thru the prior low we CANNOT label this as wave 2. The form/structure sure looks like a “B” wave …
Net-Net … this has all the markings of a VERY powerful beginning of a 2+ year move and right now the risk reward is 35:1.
It’s been a while since I blogged about Natural Gas. And, what a ride it has been …because those of you who have been following me for a while, know that I got into UNG around 9 bucks almost two years ago and -GUESS WHAT – I’m still holding it! Yes, probably the dumbest thing I ever done because I was up a NICE 5 figures and counted and watched precipitously as it just took it all back.
Again? Why?
Because when I bought the darn thing I “felt” or “knew” that this was going to be a MAJOR low in Natural Gas and I wanted to put REAL money at risk and basically ride a multi-year wave like I do surfing.
The thrill of the great waves – this run had it!
The beat down inside w/ the ice water fist to the face – yup!
No waves at all – sure.
So, guess what, I’m riding the waves of UNG for years …
In the next post on Natural Gas I’ll go into the count and the PATTERN that was present and all that. But, for now, just check this one out. I JUST saw this last night. No kidding, going to enjoy a little sun this AM before another deluge in San Diego and GET THIS – just an hour away from me (Julian) they are forecasting 10″ of SNOW. Going to be a wild weekend … a perfect time to do some charting and, ugh, taxes.
THE POWER OF THE MEASURED MOVE … not only is this MEASURED MOVE equal in PRICE it is EXACTLY EQUAL IN TIME.
Get LONG and look to leverage/ architect a position to expire in 2027 w/ a price target of 15-16 or…not.
I know this analysis might throw some of you … but, I truly LIVE by the Measured move and the potential here is somewhat analogous to this:
Congratulations to the Kansas City Chiefs. Man, what a game …well done NFL to a very entertaining and competitive event. Oh there was definitely the undertones that one would expect but, dare I say, they almost promoted THE diverse and amazing country of melting pots we are …? Maybe ?
Last, the commercials confused me a bunch. Hat tip to Breaking Bad but a lot of em’ I was left saying ” what are they trying to convey here?”
Of late, I have read and digested multiple books, episodes, podcasts, etc. of Mr. Robert Edward Grant. Folks, I encourage you to follow him and really try to understand the message he is speaking. Seriously ….
As such, I’ve taken up sketching (which I love) and squaring the circle and then adding the platonic solids and then realizing the a^2+b^2 = c^2 holds such vast and universal truths around the creation and manifestation of the universe that … I decided to just pull out the crayons and “prove” to myself the amazing harmony and geometry that exists in the markets and if WE (me included, trust me) are just PATIENT enough it will reveal itself and we will have the opportunity to manage risk and, potentially, extract money from the markets.
So, I typed in GOOGL and just started to draw … (mind you, I had never done this before, the charts are “real time” as I captured them at my leisure.
As I type this, now that its done, I can tell you that the harmony and geometry are amazing … and to think, we were taught this back in grade school.
How to draw an arc from three points ……
often times, 4.236 times the initial impulse move will prove to be R .. this time it worked and 2×4.236. WOW.pick three points – mine are the blue highlighted squares at/around the bottom leftusing basic geometry, create circles equal to the distance of each square. connect the lines ….at 1/2 the intersection price (290) draw an arc equal to the distance from 1/2 gravity to price lowthe “first” squarefrom the first square, create “fractals” of the gravity center square and continue …
Take note, anyone see the likeness of an “Adams Pitchfork?” The above is the REASON the Adams Pitchfork is such a powerful tool. It essentially makes the squares and the diagonals for you aligned with the first impulse move up or down …
Anyway, how does this help us trading? For me, it just reinforces the geometric and harmonic nature of any liquid instrument. Yes, I know that this is all “after the fact.” If you have been following me for a while you know most, if not all the time, I post “real time” or as “near as real time” as possible. Tonight, it was just an exercise to show me (and perhaps some of you) the geometrical and harmony of the market … that’s all.
GOOGL just finished a pretty smashing GART SELL and it’s been straight down SO .. I’m not looking to BUY anytime soon for GOOGL.
Last, sorry I missed that GART SELL. Just haven’t been watching “the Google” very much … no reason. Just haven’t …
Folks, trying NOT to be a massive BULL or a massive BEAR. Just patterns …
All the hype about the bull market continuing … whatever. The way I see it, we just completed the same measured move correction as the last time.
Strength thru 251 will make me rethink “another leg down” thesis but, for now, certainly appears that the Gold, Dollar, Euro, VIX, JNK, etc. etc. patterns are working …
I’ve blogged this before and I’ll blog this again – banks lead us UP and they lead us DOWN.
Below you can see a “pretty clear” 5 wave count UP in the Banking Index from the 2009 lows. We do have a slight overlap of Wave 4 and Wave 1 but I’m going to go for it as it’s not on “close” and the count fits/works.
What we have here is an “almost” perfect GARTLEY SELL PATTERN on the banks.
I saw @RyanDetrik tweet about the January effect today and I do trust and admirer his work … probability is saying that we have a STRONG year this year. I’m not there, yet.
I’m 100% prepared to throw in the count for a “next move is bearish” and just hit ctrl-alt-del and erase and take a look at it with fresh eyes.
That being said .. .the DSI on Gold is SPIKED HIGH for the bulls, we have an amazing BUY pattern on the VIX, sell PATTERNS on the Banks and JNK bonds inbound and the Euro/Dollar are both finishing /finished up 5 moves. Pullback or a resumption of the move down. I don’t know but I think this move u since October is on borrowed time …
Note – where have the banks been. W/ all this bullish talk they haven’t even made a .382 retracement, yet. Hmmmmm …
WATCH THIS LEVEL ON THE BANKS TOMORROW. A daily close ABOVE 115 and this market could be off to the races. Only TIME will tell …
5 waves complete … wave 1 = wave 5 (blue arrows) .. initial impulse wave natural log and/or square root 8 projection … ffrequency target (good stop out if it blows thru) …1.732 extension from of wave 3- 4 (note, wave 3 = 2.236 (square root of 5) ….
all this being said, this is 5 waves UP folks so the coming pullback is one we want to BUY … for now, that’s around (previous wave 4 of a lesser degree) in/around 1.05. we’ll just have to wait and see …
Line in the sand for me along the lines of the “bearish gold case” is that the red rectangle is an expanded flat. At times, the “c” wave can go 2.618*a and that’s just a little higher along w/ the 1.732 (square root of 3) extension target.
For those looking to short, recommend waiting for a daily close below 1879 (red horizontal line) Sitting my hands until then …
For now, believe gold has topped or is topping out …
There is a high probability that we have bottomed in the 4th wave and the next wave higher for TSLA is just starting. We can go all the way down to, basically, 20/share and still have a valid count but two things came together nicely PRICE AND TIME to make me think this is a “first” opportunity to get long TSLA.
Folks, if we are long down here in the low 100’s our target will ultimately be above 420. So, be judicious w/ your position size and don’t get greedy. There will be a LOT of gyrations …
If we go below the low around 100 then stop out and we’ll look to try again but for now – believe a bottom is in place for TSLA and a nice risk:reward investment is presenting itself.
RANGE SQUARE OUT
Above you will see the concept of a “square out” w/ TSLA. You can “square out” a high, a low or a range.
From our vantage point PRICE and TIME are just numbers and are equal and interchangeable. Inflections up or down occur when PRICE = TIME or PRICE and TIME are equal harmoniously.
From the IPO price we went a total of 414 points higher. PRICE.
From the ATH DATE of 11/04/2021 we simply add 414 calendar days and that date is 12/23/2022.
Additionally, this entire RANGE square out happened right around the date the BUY PATTERN completed.
Hence, believe we have an important low in place w/ TSLA.
Appears the static time cycle was off by a week or so from the top and the count hadn’t complete so that was to early. However, what we can see now is the sell pattern has completed and the potential of us going – big – has become more probable.
I’d look to be short Transports and the thesis is wrong above the most recent spike high.
January 18, 2023
I blogged a while ago about the Transports … if you do get the chance, check out the EWT professionals from, say, a year or so ago and how they did an amazing long term (100’s of years) of an aggregate Global Down Jones Transportation average … folks, the EWT pros are just stacking 5’s on top of each other at my “thesis” = big top. What do I think … well, they are the EWT pro’s and while I’m a CMT and taught it to CMTi students I can say I know corrections … to put together 100’s of years of counts is impressive. Either way … 5th waves are either finished or in work to finish. In our lifetime … it’s going night night folks. Might have already started …
Here’s a chart from a year or so ago … why my thesis on a “big ass top” … simple AB=CD .. but this is a MONTHLY AB=CD and the A leg starts back in July of 1932. So, from a “big deal” perspective, I think this is one …
Where are we now …?
I got asked on the thread about TIME and while I’m trying how to figure that into some training, I did “see” (after you look at charts so much you start to see things … maybe that’s it, I’m not sure what I see anymore LOL) …anyway, you could see the harmony so using a rudimentary cycle tool you can see that today was a good day for a “move” to occur. Additionally, used the “rock hitting the water” analogy for wave creation (depending on how high and how heavy the rock is dropped depends how big of a resulting wave we get) and from this you can see the waves propagate outward. Expanding the initial wave by 1.382, 1.618 and 1.8877 (musical note ratio of equal octave scale of music) you can see what happened to price .. but from a TIME perspective just follow up the arc to the 3 o’clock position and that is a good timing technique.
Based on todays action I would look to be short Transports and stop about yesterday’s high … sure seems like it might be TIME for the “train to leave the station.”
this is a ‘nice’ Gartley SELL pattern and, to be honest here, would sure like it to “work” as I want (hope (a strategy)) for a move lower down into 110’s to complete 6+ year triangle … as we have discussed, triangles have 5 legs a-b-c-d-e and, right now, my hope ( a strategy) is that we are carving out the “e” wave and then .. game on for an explosive move w/ the USD versus the YEN.
if we blow thru “d” will have to get out the eraser and take a peak …
either way, believe 2022 will see the USD EXPLODE HIGHER against the YEN.
in that post we did some “basic” work using EWT going w/ Wave 1 = Wave 5 and some “basic” retracement work. as you can see below there was a LOT of math and geometry coming into this level … fundamental frequencies, square root targets, geometry, extensions, etc. all made this an “interesting” area for sure.
where are we NFLX?
if you go back to a couple posts of NFLX you will see that I called it a “chart of the year” because of the very “ray charles” like count of 1,2,3,4,5. we blew thru the target zone by 3-4% probably because my ego got the better of me in coming up w/ that title (digression complete) but either way, we completed 5 waves up into 700 … and we just completed 5 waves down.
what is so important about that?
5 waves either complete a corrective C wave (they are ALWAYS 5 waves) and now we bounce OR they could show a change in trend. certainly believe it’s way too early to be calling for a change in trend for NFLX but our thesis, for now, is the 700 level was a potential big top. so, w/ 5 waves down we need to pay attention.
anyway, our targeted zone held as support (note there are at least 9 different methods showing this to be a good zone of support) and it appears our rally is on … from an Elliott perspective, a guideline (NOT a rule) is that a counter rally will go to the vicinity of the previous 4th wave of a lesser degree and we can see a LOT of math coming together in that zone/area. I do believe that area will work as resistance but I “expect” that the higher target will ultimately be the rally point as this entire NFLX bull run has had a lot of momentum …
so, for now, let’s see how this PATTERN plays out and watch the 625-630 area and also 650-660 for now …
note the fundamental frequency and square root targetsgeometry and extensionstwo zones to watch for now .. would like to see an ‘a-b-c’ type of EWT rally into one of these zones …somewhat in ‘no-mans-land’ right now …
also, note below, that Palladium also hit the target zone and found support …
Palladium rallies .. so does tech … so watch a potential really in Palladium also …!
bottom line – this rally “makes sense” and the math worked … so now, we WAIT and look to put a short on NFLX in the coming days or weeks.
thanks for reading and rock on, ok?
also, got a 4/3 wetsuit today … it’s just got plain cold in the Pacific and with a long period swell and a favorable tide, I could stay out there ALL DAY but cold got the better of me …
well, if your along for this ride you might start questioning the long thesis – I’m not there, yet, due to my entry down in/around the low 9’s … but, certainly looks heavy.
for now, we stand w/ our thesis that the low 89’s was a major low and this is a retracement in a wave 2 or B-wave w/ a rally to come.
I do like the support found from the polarity log trend line …
staying long …
here’s a look at the NAT GAS continuous futures contract … note, we’ve completed the “largest” move up since 2005 (blue lines) … reasonable to expect a move up like the orange ones from the past?
in the last post, looks like the “percentage” or “log AB=CD” worked well and led to a 40% ish decline … that was wave 3 (orange)
today, we completed the first AB=CD in the entire run … we have a little gap left open but net-net this was a very nice BUY pattern and looking at the count, certainly can make the case that we are going to start a run to new all time highs for TSLA .. then, well, 5 waves complete. will try to update targets in the coming days/ weeks but lets watch price action for now in/around this pattern level.
the target zone ID’d in the post above missed the target by 5% but has been selling off the past few weeks …
a VERY clear 5 wave count is present so I’ve done my best as providing some “guidelines” to formulate a gameplan.
the “thesis” is that we have completed 5 waves up on NFLX and are correcting based on that move …
a lot of times, not always, 5=1 and that comes in around 580 .. .we would like to see that hold and bounce up in 3 waves to prepare for a short … so, hold your powder dry and I expect, in a few weeks, it might be time to put your toe in …
as you can see, Palladium is tracking down into our level ID’d above back in September. additionally, you can see that they track each other pretty nicely. it’s NOT exact but the general trend and flow is pretty much the same…
during this sell off in Palladium, the NASDAQ 100 has held up pretty nicely and we are approaching a level on the Palladium chart that represents the LARGEST corrective move in the past 15+ years. this measured move is key …
time to play IF and THEN …
IF we hit the level below on Palladium AND it holds THEN I would look to be a buyer of the NASDAQ 100. note, we have a LOT of thrust coming into this level so let it shuck and jive and look for a weekly signal reversal candle on palladium (in this case the HIGH of the candle that makes the low (the wick is included) on a weekly close above is a signal reversal candle or SRC)
note the thrust coming into this very important .786 retracement node. additionally, we have a 1.618 projection a little lower sitting right on top of .841 retracement. (1/1.1892 = .841 equal octave scale of music ratio) and we can throw in some polarity and bullish divergence so would expect some support or a pause.
that being said, I enjoy doing ratio analysis so here’s AMZN / BABA. the first graph below is back almost 4 years ago when I did the same relative strength look because, at the time (believe it or not) BABA was stronger that AMZN. don’t believe me? look at the ratio … it had been going down for a couple years as BABA climbed but then guess what, measured moves and retracements and a bunch of pattern stuff gave AMZN the support in the ratio and off it went and the rest is history. (note, did I mention – once – anything to do w/ sales, or revenue, or anything like that? nope …just numbers and patterns for me)
if seriously trying get long BABA I would watch for a daily or weekly SRC before entering. when I look at those relative strength ratio charts it looks like BABA is about to get smacked even harder so caution warranted … wait for an SRC.
this is the 2017 AMZN / BABA and note the “technicals” at work here …the first AMZN/BABA chart is the circled area in the chart above .. note, it worked.
below is our ratio .. if you remember my last post, we were talking about a monthly or weekly close BELOW the consolidation and the market would take off … it started but jumped back into the channel and has been climbing ever since.
what has happened in the market? some interesting selling … but is THE TOP IN?
honestly, have no idea nor do I care if it is or it isn’t. all we know is we now watch the top of the channel … if that gets attacked and we get a weekly/monthly close ABOVE then a health meltdown could occur.
for now -just in the middle of the channel folks. looks like it wants to go higher to hit the upper channel – that’s what its been doing – so why not? higher means some more volatility / selling but nothing to freak out about, yet.
so what do you do? here’s something easy … if your a bul or like buying then BUY the TOP of the channel and if your a bear and like to sell then SELL at the bottom of the channel.
it’s going to be very interesting. hit me w/ any questions …
we last blogged about the “1.618 level” and the fact that we are in the continuation phase of completing a LOT of 5’s or we completed it at the AB=CD.
that is one heck of a bearish “wick” on that candle folks … but it’s also a LOT of thrust into the AB=CD so WAIT but if your long Transports might want to start paying attention to them …
and then I think ..
“now that I see a MAJOR pattern completing (yes folks they do fail – please remember that) I think of what could be the “news cause” of actually really thumping the transports that, after a little sell off, have weathered the pandemic actually pretty swell ….”
the game plan/strategy is to BUY the first PATTERN in a “new” trend and if it works then probability is that the trend change is real …
Energy, Ags, etc. are exploding of late and GLOBAL shortages that are becoming apparent pretty much every day are REAL. so, if one thinks (trade what you see not what you think) that Nat Gas prices are due to continue to rise then we have UNG that will give you exposure.
if we break thru the low at 13 then I would consider this a failed pattern but we have some MAJOR support coming in/around 15 for the BUY to get long nat gas and, perhaps, hold this position for a LONG time …
it’s all probability folks …
below, you will see a MONTHLY on UNG since inception. wanted to post this chart so you could see why I wrote the above .. have we broken out in Nat Gas? have we begun a new bull trend? full disclosure, I’m long UNG down in the single digits and will be looking to ADD to my position at this pattern completing – if it ever does.
take note of the volume picking up and the fact that the RSI is at it’s highest level .. the key here, in the coming ongoing pullback, is where the RSI finds support … if we find support on the BULL ZONE (around 40ish) then we can start giving our change in trend some more probability … but, for now, we are speculating that a very investable low is in place .. don’t throw the farm at this one .. nibble at it … as we will see the breakout occur and there will be more time to get LONG if the “low in place” thesis is correct.
additionally, the “length of the base equals the price target potential is also nice here .. we’ve been basing for 6 years and, if you want to split hairs probably 10 years once that low was put in place 2012. bottom line, if this things goes higher, it’s going to go ….
another way to check trend is via long term LOG charts .. LOG’s help you understand rates of change and are very good at giving first hints of big changes in trends or inflections …in looking at this on the long term log scale, certainly appears to have broken the long term log trend line …
last, when you are building a position, it’s wise to see how “strong” or “weak” that security is compared to high fast flyers .. in this case, for no other reason than randomness, I chose UNG/NFLX.
yup, Natural Gas has out performed (on a relative strength basis) NFLX for all of 2020
as you can see, the NFLX AB=CD failed by, roughly, 4% and w/ this price point one would have some pretty big exposure if playing single shares ….. I considered that PATTERN failed.
that being said, it was a PRETTY HUGE pattern (hence I called it chart of the year) so I went back and looked at the “form and proportion” of this move up into the high and I saw on a daily that we had some more “count” to go and a projection smacked us right into the high (for now, it’s all probability)I realized my ego got in the way here, putting something out like “chart of the year” … I can’t stand when NFL or NBA players make a big deal out of play … why would I fall into that trap? my apologies.
that being said, this is a pretty big target zone so I do think we need to take this top seriously. however, a REAL change in trend would be a MONTHLY CLOSE BELOW 600 as shown below on this DAILY NFLX chart.
in order to fully understand the SRC or Signal Reversal Candle please pay attention to the chart below:
as you can see above, the SRC is a MONTHLY close below 595. a REALLY conservative play … however, you could do an intraday 60 minute SRC or daily, weekly, etc. it all depends on your risk tolerance.
holy smokes .. the underlying BULL market that we have right now is pretty amazing …
I went on to chat w/ JC of @allstarcharts.com a couple months ago and we talked a LOT about IWM. we went over the MATH of why it stopped where it did and, folks, the math on multiple time frames and multiple techniques was PERFECT. he still hasn’t “published” our podcast – maybe because he knew it was going to break out? 🙂 who knows …he’s a lot smarter than I am but still a GREAT dude. follow him peeps!
and guess what ..IWM pattern, it wasn’t WRONG but it certainly wasn’tRIGHT.
BOOM- we broke out today so guess what? I have to get my eraser out and start over and, unfortunately, that’s happened many many times. 🙂 why should I be surprised? well, keep reading.
the market went up to our target area and hit in/around 233. as we describe above, in an irrationally exuberant bull market, WAIT for the SRC and the signal reversal candle was finally hit the week of my birthday (note a fun fact – the HIGH on crude oil hit on my birthday 7/11 – shown below- synchronicity?)
the HIGH on Crude Oil on my birthday
I show the Crude because of my birthday but also because of the PROBABILITY of what can and can’t happen when a TON of math comes together.
folks, MORE math came together (see the last post linked at the top) on IWM .. so only being human I EXPECTED it to dump and the rest of the market to, well, at least follow along … ? unreasonable?
well there it sat … and sat … and then an SRC
Here is the SRC for IWM:
SRC for IWM
more than likely, a short would have been initiated and we would have been stopped out ….
end of story – right? well from a P+L perspective, yes. folks that is ALL that matters.
from a form and harmony and balance perspective this IWM continues to amaze me.
please see the chart below:
if you have been reading the blog you know we had been targeting this price zone for a while and when it hit you know I (most of the time) say WAIT for a signal reversal candle because it’s probability – right? of course … so sometimes the pattern will act as support or resistance (this is what IWM did for 233 days but ultimately it failed.) and sometimes it will work and inflect to your favor or it EXPLODES continuing the trend … it’s all probability. but I think I’ve shown that “stuff” happens around the patterns – fair enough?
what’s key for me, even though we are dealing w/ probability, is I KNEW there is still a “beat” or “rhythm” to it … that’s why the patterns help you manage risk, right?
so, at the end of the day today, I saw that the market was up again and I thought … “I bet (no kidding, I KNEW this was the case in my gut) we made the PRICE high the same many days (TIME) ago … “
there you have it above … 233 calendar days ago the price HIGH was hit and is it any coincidence that we BROKE OUT when PRICE equals TIME? NO – that is how it works. our job is to figure out what the key master has in store for us regarding the harmony and balance of what we are dealing with … it’s all based on math and music but it’s also a multi dimensional chess game …
why would I type that last sentence?
well, 233 is a Fibonacci number as shown on the chart above … the Architect, what a sense of humor she has ….
there was and still is (for those who have the PRIVILEGE to do it) something so amazing about the feeling of going BONS (Boots On Non Skid) of a US Naval Aircraft Carrier.
it wasn’t a ‘bravado” thing as people would believe from the characterization of Naval Aviators but – for me – it was simply amazing. being on the flight deck as engines were turning, the ship was moving and everyone from 18-50 (?) was moving in elegant and frictionless dance .. it was that amazing.
and when you walked up to your jet and there was an AMAZING YOUNG SAILOR (note no identity needed because WE DID NOT CARE) told you your jet was ready you simply took it as fact .. how cool?
so you would jump into the jet and get this multi-million dollar tax payer funded rocket ship ready for the catapult shot and – I believe EVERYONE – asked themselves before Mr. Toad’s Wild Ride “have I done enough to manage the risk” and “yes” was always the answer and for me … BOOM I shot off the pointy end of American Diplomacy. What an amazing privilege and honor.
what does this have to do w/ NFLX? EVERYTHING ….
folks, we have an near perfect AB=CD, a 1.618 extension into the target zone … and, at least for me, an Elliott Wave count that breaks NO rules is present on multiple degrees …
maybe it’s time to PUT your money where your mouth is Bart when we reach the 650-660 area?
if your someone trying to get short – sure looks like the bar is eating you …if your trying or are long looks like you are eating the bar … man, this is interesting.
1/ as a PATTERN recognition expert I can say that the PATTERNS for selling equities FAILED over the past two days.
2/ as an intermarket musician I try to look at everything ….
3/ so lets do that ….
the PATTERNS have failed
Palladium really looks like another leg down … Palladium down has been equated to NASDAQ down and, to a certain extent, equities down
NFLX … man, that pattern is REALLY close …
Banking Index – again, a MASSIVE pattern a little higher …
XLP/NYA – certainly might have BROKEN DOWN (equity strength) of the 7 month channel …
so what do we do ..
me?
sitting on my hands and looking for a simultaneous 1/NFLX target hit and 2/ BANKING INDEX hit and 3/ XLP/NYA target hit and then SHORT the NASDAQ w/ a vengeance ….
until those 3 criteria are hit I’ll continue to lick my wounds on MJ 🙂 but … seeing the “numbers” come together for NFLX makes me think I might have to break out my timing work … as a side note I recommend you go and BUY Connie’s book (novel, war and peace) the 32nd Jewel .. it’s mind blowing and I’m only on the 3rd chapter because I find myself against a wall and then I go and “find” (I wonder how I find them) books on number theory and Planks constant and inverses and … the rabbit hole just spirals so I’m reading Robert Edward Grant’s “Philomath” and – total mind blown – but it’s helping me go back to Ms. Brown’s expose and the TIME factor becomes understandable but – it’s still elusive in nature – so when I get a bunch of numbers coming together I work backwards to figure out – what- exactly – is the VIBRATION that NFLX is rolling along with …..
the KEY is the DATE of the IPO and, I think (I’m still learning) that first “long term” pullback from the initial impulse move … that is where the rock hits the water and the height of the drop, the weight of the rock , the wind, the moon, the tide and ANYTHING that is PRESENT and PHYSICAL interacts w/ the waves to create the moves we see … it’s really that simple.
IF (and trust me it’s a BIG IF) that’s the case then wouldn’t the mathematics of the ancients (note, probably you and me and anyone else present right now … ) that govern natural harmony work on the markets?
YES .. join me going deeper and deeper and deeper into the rabbit hole …
chart of the year ….nothing “truly” goes down till the banks go down … pretty big target approaching …
love that saying from the Big Lebowski … what a great movie.
so, here we go folks .. I’ve just ran thru the DJIA, NASDAQ and S&P 500 and ALL have sell patterns.
what does that mean? well, nothing … right? it’s all probability …
but, that’s what we play, probability …so, we have Gartley SELL patterns across the board – they will 1/ work or 2/ not work.
also, our favorite ratio is banging against the bottom of the range that it’s been swimming in for months .. but, take a look , at this lower level you will see an AB=CD, a 3 drives to a bottom and a butterfly BUY on the ratio. so, when the ratio goes UP then the market usually goes down …
we break down below our XLP/NYA level this puppy could rocket ship higher and, then again, the sell patterns work, the XLP/NYA level holds and we start selling off again …
most people think “equities” and that’s it … there are many asset classes that are just starting multi year (decade (?)) runs …so while stocks are correcting and seem to be pretty stretched taking a look at the current environment and just looking at the news we can see their is a BIG battery shortage coming.
usually, a shortage means higher prices … LIT has been on a tear, up almost 380% in the past 1.5 years…. I haven’t even been paying attention till my two Rugger buddies were texting about it last week.
I found an ETF, LIT, that looks pretty liquid and has been on a tear …
trying to get into a moving market is hard to manage risk so, for now, looking for a correction to try and get in … this will, again, be a multi year hold.
also, if your not convinced, I did LIT/NASDAQ and sure looks like we’ve bottomed out and are about to break out and take off from a relative strength perspective.
I’m a Cannabis BULL and out of my portfolio, right now (knock on wood) the only thing losing money is MJ …
so we “survived” by hitting the .786 from the all time low and bounced and now (intraday) we are setting up for a BUY pattern in/around 14.40-14.50 BUT, folks, this one looks like I might have to eat some crow.
hope is my strategy at this point so if we close (weekly basis) below the .786 will probably take this one to the donut shop and eat it … we’ll see.
hope and change baby hope and change ..
I “hope” we find support and go up from 14.33 and also hope that the intraday buy pattern holds and we “change” trend ..
yeah, that worked out great the last time so … probably going to take a loss on this one.
as you all know, I watch the XLP/NYSE Index ratio for key inflection points .. when the ratio goes UP then “staples” (think risk off) have more relative strength and when the ratio goes DOWN then the overall market (think risk on) is stronger from a relative strength perspective
with the recent market action … one would think the ratio would have exploded higher .. well, yeah, no – it hasn’t. still stuck in the range it’s been trading since FEB 2021.
so, for those max BEARS you might want to watch this .. need an upside break out above the red line to get the party started and for the max BULLS need it to break down below the green line …
no idea which way it will go BUT I will tell you I was surprised when I took a peak at it during my nightly cruising of the charts … my “thinking” was that it would have been higher, much higer.
but we trade what we SEE not what we think … so, until the ratio closes above the red line I’m going to say this sell off is a much needed correction that will ultimately need to be bought … and if we break BELOW the green line, then, perhaps game on for another run.
note, Palladium did not take out the low from a couple days ago BUT sure does look like a dead cat bounce . that being said, corrective forms are usually 3 waves so perhaps we go up again to finish off the correction or we just dump lower from here .. that is the question.
either way, the amount of selling and thrust right now begs of caution if long but you might want to perk up as we go into the 1500-1700 level on spot palladium.
also, don’t need to catch a falling knife so watch this level, let it bang around an, perhaps buy on a retest.
think about it … went to a long term Palladium chart and was able to calculate the low of 80 ish in Jan 1991 (yeah, 30 years ago) and then figured it was close based on the sell off .. well we hit it and YAWN HO HUM I would expect it to EXPLODE off that level … certainly looks like a dead cat bounce to me … hmmm
I like the lower blue level for BIG support and then, perhaps, a chance to buy or get the bounce and exit before it really gets ugly. (hint hint – it isn’t yet)
I redid my NASDAQ chart at the request of a friend .. the other night, when I posted it, I just drew the “AB=CD” and figured I would tighten it up over the weekend …I did tighten up the target w/ some more precision.
the AB=CD has been hit.
how did we get this target?
from the low in 2002 we label A. The most recent 2020 highs are B and then C is the low after that pretty quick drop (note, it was one of the fastest percentage moves drop in history) from there we can calculate the AB=CD target. Appears to have been hit ..
from the all low on 10/03/74 we draw the radius of the circle all the way to 2000 .. that’s a BIG rock hitting the water, isn’t it?
from there we draw our circle … once we have the circle we can create the square based on said radius and that is bolded in BLUE.
speed or fan lines originating from the all time low and being based on the geometry of the first impulse move are pretty powerful. as you can see I divided the length of the square into the usual ratio’s and then drew the fan lines from the all time low … take a look at the result.
there is a lot going on w/ these lines and there is a lot more geometry that can be drawn but I don’t want to clog up the chart.
so, net net, pay close attention to the NASDAQ in/around here, fer shure … if the AB=CD pattern fails to the upside there are other targets that I’ll update but for now, this looks like something that we should REALLY pay attention to …
tomorrow, have the opportunity to sit down w/ JC and continue our discussion around Fibonacci and vibrations and patterns …I’ll post the talk after its completion and believe it’s also live streamed on Twitter. We’re doing it after the market closes …
in the last episode he specifically asked that we spend time on the “rock hitting the water” or the “initial ripple” … below, you’ll see the chart that gave us an “idea” of a POTENTIAL stopping point and it’s the “regular” technical analysis. this is the chart that I blogged.
but, in order to REALLY get an appreciation to why this LEVEL is so important and how, perhaps, one can start making that little move towards the cliff to jump into the rabbit hole w/ me I show some more of what’s really going on … not meant to confuse anyone but to visually show what I mean when I say I’ll usually look at 11-12 things before making an investment … I didn’t blog the last two charts because I think it’s just too much information. honestly, that’s the only reason.
Is IWM going to breakout or breakdown? YES. NO. Have no idea but whichever way it DOES GO it’s going to be a wave to catch and surf … fer sher. also, it never hit my Signal Reversal Candle. (SRC) who the heck knows when it’s going to blow …
initial post showing target zones for IWMtarget being hit … the green highlights are qual to the dashed red lines (note – start the “square” at 32 and other numbers …)the ROCK hitting the water and the waves that result … the ROCK is the initial impulse move off the low on 10/10/2002 … using physics the fundamental frequency is then calculated.simple calculation from the all time low and “creating” the IWM Musical Scale based on the Equal Octave Scale of Music (multiply each cell by 1.05946) NOTE: the high zone in IWM was equal to the finishing of the 4th octave.
chart below has Palladium w/ the NYSE Index overlaid on top.
the candles are Palladium and the blue line is the NYSE Index ($NYA)
note, currently, Palladium is correcting pretty steeply … in the past, this has led to the overall stock market to correct also. is this time different?
as the market continued to climb to new highs, if you look at the chart below you’ll notice that it did not move to new lows. no, in fact it has been basing since Feb .. almost 6 months. in a truly bullish environment, it would be game on and this ratio would continue lower. it did not …
in fact, it appears to have some strength and starting a breakout to the upside.
THAT, is not a bullish equity move … so, keep you powder dry. if you have been following my blog for a while you know how powerful this ratio (XLP/NYA) has been at warning about inflection points … yes, we have lower targets from the last post, but, for now, certainly appears that the ratio is/has bottomed and a “risk off” mindset appears to be taking hold ..
one last, I went in and fiddled w/ my settings and everything and can’t figure out why all the candles are green? maybe it’s that I’m using a “ratio” but I’m not sure, so I do apologize for any confusion. for whatever reason 4 candles are red …?
well, it went and hit right at the top – exactly I think – of our target area and is built a series of 3 higher lows (daily) …but we do have an entire “zone” of support in/around 24-28 so this could be a dead cat bounce. give it time …
but, this count is valid and, dare I say, AMC is off to the races …?
keep an eye on this very very very key level on the USD Index. correspondingly, here’s a EURO BUY PATTERN present inverse to the USD. (it’s usually how it works)
they lead us UP and they lead us DOWN. the banks, financials … it’s that simple.
that being said, the move since March 2020 has been strong and straight up .. kaboom that’s a face ripper higher and, frankly, caught me off guard. why?
well … the ZIRP, the multiple trillions (yes I just typed MULTIPLE trillions) of sovereign debt is beyond anything that we could EVER imagine. folks we are in unchartered territory. again, we are in the vapor ware of experiential historical construct and, from where I sit, it’s UGLY.
but, the band plays on … right?
so, I present, more than likely the most important chart out there .. the banking index.
I had the opportunity and that is what it is .. an an opportunity to sit down w/ JC yesterday and chat … it was blast. but what came to me is while I have all these followers – thank you!- nobody really knows what I’m showing so I’m going to break it down …
BLUE VERTICAL ARROWS – they are measured moves .. every move UP has ended at their conclusion .. so, note around the 155 level – make it simple
DASHED BLACK LINES – just showing you where we take the key nodes and EXTEND from those points … NOTE that 149-155 we have some confluence.
ELLIOTT WAVE – love it, when it works … seriously. if your going to go down that rabbit hole, just learn the corrections … anyway, a VALID (trust me, doesn’t mean it’s a correct count LOL) count shows us finishing 5 waves in around the level sighted before. NOTE – the orange lines is the current wave that we are counting and 1=5 in our target zone.
so, 149-555 BIG DEAL for the financials ….
now .. go on … rock on, capture your stoke folks …
was able to spend a Friday afternoon w/ JC and his production crew and we were talking about “why” fibonacci ratio’s work in the market … here’s my best guess. LOL
well, underwater on TBT. I’ve shown my entry and man did that look like a NICE one .. but, it’s all probability. folks there was a TON of math coming together in /around 17-18 and it got wiped out. but, we have some support holding at the .707.
I’ll cut half my position on TBT if we lose 16.06 to the downside on a DAILY close below.
I’m still bullish RATES but … trade what you see, right? let’s give it a couple more days and then might need to throw half a towel into the ring on this one …
also, I’ve done the 30 year continuous futures contract INVERTED to show the same picture at TBT and to also see if there is some support that might be found on this one … hmmmmm. can’t win em’ all …
investing is like golf .. learn how to play out of the rough and the sand and you will be a good golfer! I’m still learning!
PFE is all over the news – not that I care about that BUT the sentiment towards this stock is getting worse … additionally the “big target” was hit up at the monthly level so this stock “should” have a major top in place. (of course, should is the operative word)
down on the 60 minute chart am waiting for a SELL PATTERN to appear but for now, its no mans land.
not sure I’ll be looking to be LONG PFE until another big leg down occurs.
Look to short for now … on my watch list.
49-50 seems reasonable for a short attempt – would like to get a projection up there but can see this offering strong resistance – for now.
August 04, 2021
above is one of my first forays into Harmonic Pattern Recognition … it’s PFE way way down in the low teens. believe I was looking for 13-14 as the low. anyway, when looking at PFE today it reminded me of that chart …
anyway, based on this vaccine stuff and a boat load of cash, looks like PFE is off to the races. some nice resistance above on the weekly and then a “final” target at a double AB=CD and 1.27 extension. that should stop it or at least provide some stiff resistance.
buy pattern is completing, completed. let’s see what happens now … again, it’s ALL PROBABILITY but the masses who have been hanging on might see some light IF (the big if) this PATTERN holds.
I have no idea if it will or won’t but some buds were crazy enough to TRY (operative word) to play this w/ the masses so .. here we go!
the coin marched right into our target zone and has backed off .. in fact, it hit, exactly the 1.618 projection. if you remember, the “c” leg is often 1.618 “a” so we hit that …
there are still some higher targets but the theory is that we are in the beginning of a C wave down and then a BUY in, potentially, the low 20’s.
could we be advancing and wave 4 already complete – yes – but for me, it’s too early to tell. for now I’ll watch and monitor ….
note, the symmetry of the moves … wave 1 = wave 5 and the internals of wave 3 are perfect … 1 = 5 and 2=4.
you’ll also see some numbers to the side those are projections showing the clear symmetry in the waves
lastly, we were so so close to hitting the 16180 or 1.618 high .. off by .1 percent. anyway…. if you open your eyes to the harmonic ratio you will see a ton of examples.
just to show you … here’s the USD versus the LOONIE on a LONG TERM monthly and note the top …
yes that’s a MONTHLY AB=CD and then, just for shits and giggles went up and tagged 1.618 and “night night.” Just saying … pattern on a harmonic number, pay attention.
that was QUITE the pop today and we are getting close to resolving “one more leg lower” or was that it …
either way, my BULLISH outlook on Bitcoin remains … the chart below is the bearish option and the one I’m going w/ for now … but, we will know soon.
be ready to shift to the “low” is in place and we are advancing in a 5th wave (foot stomp) but the move should be big ..
so, in the more near term bearish you can easily see we did 5 waves down and now we are simply doing a 3 wave B move and then a BIG C wave to come …
I’ve noted a very important level for resistance .. if that holds and we start down lower then it should be impulsive and powerful (like a classic C wave) …
I want to see that “resistance” level noted above to being take out to the upside before going long. truthfully, would love the a-b-c to be in play as it will give us a better AND a rule of life is that the C wave HAS TO BE 5 WAVES (EWT) and it’s usually very violent and harmonic and pretty easy to count so when we do go long, we should have a very risk controlled entry to go long.
yes, big spike today, but don’t get fooled or too bought into the bullish case, just yet.
hope makes sense .. let me know if I’m missing anything.
if the blue measured moves tell us anything … corrections usually occur at their completion. right now, we are at that extreme and we are banging up against a 1.27 extension. would use that level ( or a little higher) for stop out point and would look to sell on a close below 44.50.
the masses are at “play” here w/ AMC and what a better laboratory to test harmonic patterns than on THIS stock …
the only caveat – it’s all probability. that being said, w/ the balance of thousands upon thousands of our fellow retail traders holding 2 shares portfolios at risk, we can enter w/ a defined point and another defined point of where we are wrong …
so, the GARTLEY PATTERN buy is 28.80-30.98.
the red lines are back from the weekly/monthly and are horizontal lines placed upon former resistance that should (operative word) act as support .. the polarity principle.
anything below the above and this puppy is cooked …
TBT has fallen into the bottom level of BUY zone and I’m long TBT in/around 18.
A lot going on w/ his chart but wanted to show you some “other” geometry that I was working … you see, we can make arcs and develop trend lines using the geometry of the chart but also, using the TIME and PRICE to define the vectors.
in this case, we take the all time low and draw the bottom of the square to intersect the “time” of the high. that will define our arcs and the square. the most important aspect of a square is the 45 degree angle (red line) and that line we then “copy” and “paste” to the bottom right of the first square and, well look at that … it intersects the LOW almost exactly. we also draw another square (and we can/will keep drawing these squares to find the trend lines running the show) and notice how the two 45 degree angles TIMED the low almost exactly .. (FWIW, this was a precise 1.618 AB =CD and a .618 retracement along w/ the same percentage corrective move that drove price into the all time low … came in around 21-22 percent decline.
so, while we do have the traditional “slap a retracement grid and look for the .618 retracement and a whole lot more …
take some time to study this chart .. try to understand it as it’s very helpful, indeed.
and, w/ all this work, I’ll consider it “wrong” if we get a daily close below 16.08 (.786 retracement)good weekend to everyone …
nice rally from the fresh lows in the high 20’s .. but, for now, still suggests a correction in a ongoing 5 wave C wave pattern.
if we blow thru 41358 (note futures contract – other prices may vary) on a daily close above then, more probability that the low is in place for an advance.
for now, a near perfect Gartley Sell Pattern exists in around 38-39K
lot’s of pressure on the Coin … certainly doesn’t look like the low will hold and will plunge into the 20k’s.
here’s the deal, this smells, feels (I’ve been “scrambled” (surfing term being caught inside) by a C-Wave before) and while it’s a fools game to pick tops or bottoms, I’m trying to find the pattern that will give us the best entry.
I’m long the Coin and getting some egg on my face (see scrambled above) but am going to hold to look for some support and the possible low to be in place to begin the march higher … what do we have going:
Note (3) up near the all time highs .. I REALLY LIKE when a new high is made on 3 waves. that is a classic “b” Wave into the new high and then C wave wipes everyone out – like right now.
the wave count (if this is correct) shows 5 distinct waves down from the high … a “guideline” NOT A RULE is that when 3 extends (in this case 1.618) then 1 = 5 (blue arrows into/around 23K)
a RULE is wave 4 (we are in an expanded flat wave 4 correction right now – if correct) is it cannot go below the end of 1 .. (dashed green line) around 15K. If we go thru 15k to the downside then wipe out the count and this is 100% wrong.
I threw a “basic” retracement grid up there and highlighted the blue box for a support zone that would 1/ finish 5 waves down, 2/ finish the C-wave and 3/ end (4) and then we go UP into the 70’s to start …
also, threw in the fundamental frequency targets (dashed purple lines) and also used the largest percentage correction (dashed red arrows to find the mid-20’s looks like a stopping point to give another a shot ..
it’s all about the data folks … in this case we have a monthly continuous contract of Copper Futures. the PATTERN into the low back in 1990-2000 (yes it took 10 years to complete .. read that again – 10 years) is hard to understand w/out anymore data to the left of it’s beginning so it’s hard to figure out if the high in 2010 was a big 3 or big 5.
thus, I’m going to outline two scenarios ..one bearish one bullish.
BEARISH: replace the big bright orange question mark w/ a bigger 5. IF that is the case THEN the most recent high was completing a B wave and we have started a C wave down … C waves are freight trains of beauty and a wonder to behold .. leave nothing in their wake. stand by …
now, hold the phone, what if the big bright orange question mark is/was a 3? then, the BULLISH scenario is we just finished wave 3, are correcting wave 4 and copper is a BUY into new highs … it’s still working it’s way thru the corrective PATTERN that will appear so it’s hard to make a projection but we should NOT go below (1) as that will violate a rule …
so, for now, take note of the blue arrows .. the all time high was, yup, an AB=CD staring from May 1999. It smacked right into that …
kind of in no mans land from a count perspective due to data but expect the two red horizontal lines to act as support due to the polarity principle …
Happy Fathers Day …
also, note EEM .. smacked into a nice target zone in/around 58 and the second chart shows the daily sell signal on EEM.
minor EEM sell pattern on the daily …
last, note the synchronicization between copper and emerging markets … pretty nice correlation.
last, note the FXI (china) has NOT made new highs while Copper and EEM have .. below you can see that high/low inflection points are nicely timed by the Chinese ETF …
so, for now, expect copper weakness for the next couple weeks then we can figure out where we might be from a count. if anyone has really long term copper data please let me know.
and down the rabbit hole he goes … at least he has me “guiding” him although throughout his life he’s the one who I feel is parenting …
he’s questioning the “reason” that this works … but that will come, in time.
“…even the very hairs on your head are numbered.”
CVX – shows a triangle but some pretty thick thrust down to close last week. IF the triangle holds THEN we pop up into the sell zone and then … should be down.
note the timing component – believe next week will be key.
below you will find the SHORT DOW ETF called SDOW. it’s pretty fascinating if you think about it or look at it .. your preference.
basically right around the start of the pandemic around the week of 02/14/20 the volume was HUGE and the SDOW went on a nice run higher. well played … but since then it’s down basically 10X and there is still a lot of buying …
look to the far left and this ETF fell so far and nobody was interested and then last year hit and someone/somebody has been buying and selling this security …
now, of late, if you look closer to the last couple candles and corresponding volume you’ll see that the most BUYING volume ever has come in AND the price as pretty much stabilized at/around the low 30’s ….
alert went off last week and the upper target zone on the DJ Transports has been hit ..on my monthly chart that level is 16180 and while I know a lot of you will just see a NUMBER and that’s cool but when you play w/ numbers EVERY day you see 1.618 … you study sooooo much that you understand “why” we don’t need decimal points and what they actually mean so you can move decimals point around.
if this is the high, I really have no idea if it is or it isn’t then the Architect has a really FUN sense of humor. think about it .. the “low” during the financial crisis on the cash SPX was 666. not kidding .. check it out. now, w/ one of the MAJOR indices topping out on the Golden Mean … well look at that.
the chart below is the “bearish” short term case … as you can see from the title, right now, we have been making the stair steps of “higher lows” but it’s not a THRUSTING or MOMENTUM move like the one we saw off the low in/around 30K and the geometry/form is starting to “look and feel” like a 4th wave triangle …
so, need the 38,340 and 40,000 to get taken out to the upside by momentum and a daily close else we are going to be under some more pressure …
the good thing .. we have a clue where we are w/ both scenarios so we can plan accordingly.
in this case, the triangle, they “usually” occur in the 4th wave and then have sharp reversals … mid 20’s can be expected if the bearish triangle is in force.
if not, then the “stair steps” should hold and we are beginning a move into the 70’s …
the chart below is the chart we are currently working off .. in this case we are following the bullish case that the spike low in/around 30K was the end of the C wave and we are going to advance …
need to see some thrust/momentum UP to validate the low is in place … so far, that is our running gameplan.
truth in advertising, always, on my blog … the bearish triangle gains traction the longer we just limp along like the dead cat bounce this might be …
LOVE the Loonie … as you can see below, IF (the big IF) you can catch a wave this FX pair likes to run .. in either direction. well here comes a wave …
at 1 we have the classic AB=CD and, at least for now, it is holding …
at 2 we have a lot of MATH coming together along w/ a corrective (dashed red line) move that has present on most EVERY major corrective pullback.
w/in both above (1 and 2) we have the TIME dashed green line … that’s pretty key to me. Something (hint hint look up at the sky at night) has been responsible for the corrective TIME of EVERY MOVE DOWN since the beginning. a measured move in time, if you will. if your wondering, the dashed orange line is of course harmonically related by fibo .382.
guess what, I’ll WAIT for that … and that’s the end of the summer, and I’ll table the Loonie but I wanted to show the power of TIME and PRICE combined. Guess what, if it doesn’t work, there’s 50+ other currency pairs. I’m trying after so so many years fighting to make this easy and enjoyable …
in the last post we created two target zones w/ the “basic” AB=CD and 1.618AB=CD projection technique. doing some rudimentary wave counts I’m going to call the low as a corrective move being complete but I’m updating my count to show that this is still wave 3 of 5 that we are in …
what does this mean?
we “should” (from current levels) move up into the mid 70’s or 80’s and, depending on the chaos of the masses maybe even higher but it is going to be the final wave higher w/in this BIG 3rd wave.
then, expect another nice shake down WHICH SHOULD BE BOUGHT for the final leg that should take us into the 100k’s …
