High Yield Index – Option Adjusted Spread – September 21, 2023

My good friend Jerry over at https://growmytsp.com/ sent me a chart over last night and, using basic measured moves, you can see the “rhythm” and moves of this index. Since the low in 2022, it’s been the same percentage move UP and same percentage move DOWN. (green lines = up and red lines = down)

We are at, or perhaps a little lower, pretty significant support …

why is this important .. I’m not gong to bore you w/ fundamental analysis about credit spreads and all that when a picture paints a thousand words …the picture below is saying “when I bottom, the S&P tops.”

Junk Bonds – September 21, 2023

Last post on JNK: https://bartscharts.com/2023/08/16/jnk-august-16-2023/

On the daily chart below the JNK gapped down today and closed below (daily) the two trendlines we have monitoring. On the “good” and “other” scale this is an “other.”

That being said, the REAL trend line that is CRITICAL is the second chart … a daily close below that and we might have the nascent beginnings of a credit event on our hands …

S&P 500 – September 14, 2023

Extremely important pattern appearing on the S&P 500 / ES tonight. As I was cruising the charts I noticed this SELL PATTERN on the cash S&P 500:

The reason this is so important is the most recent high is “supposed” to be the second wave / b-wave high and we “should” be going down … failing this pattern STILL gives weigh to the higher target shown and we have that BIG GAP to fill so it’s not a “sure thing” for the bulls but I live and die by the PATTERNS and this one is a nice one … if you see (not labeled) the 3 wave move to the recent high that we are shorting fits ‘nicely’ into a 2nd wave and, again, we “should” be going down in/around here and pretty much, now …

why now? let’s go to the ES

I like the “concept” of square outs as it’s pretty simple … price equals time. so xyz many points down converts to days and then you use calendar days (in this case) to project a future “square out” of price and time.

in this case, the market fell 283.75 points and, moving a decimal (trust me we can do that – go read or follow Mr. Robert Edward Grant – he’ll explain it. Too long to do here … anyway that becomes 28.3 calendar days and, from tomorrow 09/15/2023 if you go back that many days you get the low at 4350 on 08/18/2023. A “square out” takes place on the E-mini tomorrow and it’s up against a BIG resistance zone – sure looks like a short too me? Doesn’t it?

Apple (AAPL) – September 12, 2023

Last post on AAPL: https://bartscharts.com/2023/08/07/aapl-august-7-2023/

Well folks, here’s a VERY important level for the market. We are all pretty aware that “as Apple goes, so goes the market.” Now, of course, you have the FANG and all that but Apple is pretty important.

As I was taught by Larry P – in a bull market, it’s always wise to BUY the ABCD.

Guess what – we have a PERFECT BUY set up for AAPL. And, on a daily timeframe.

Pay attention to this level .. it sure looks like a 3 wave (green arrows) move to new highs (perhaps a “b” wave” ) and now we have a 5 wave decline starting that “then” must be bought. Or, is this a wave 4 to finish a 5 wave sequence up? Welcome to Elliott Wave. 🙂

From a pattern perspective, we have a “near perfect” BUY PATTERN on APPL approaching. I would “expect” some support and if this market is bullish then perhaps AAPL will take off?

I can tell you that if we fail to the downside and this level gives away w/out even a hinkering a fight then the entire market will be under significant pressure.

So, this is why I like the PATTERNS so much. I turn off the news as much as I can … yes, I saw some news somewhere about China and the I-phone and blah blah a day or so ago but I posted the “top of the circle” weeks ago .. no idea. Folks, prove it to yourself, the news breaks w/ the cycle.

So, WATCH THIS LEVEL ON AAPL CLOSELY … it’s a big deal.

Bonds – August 22, 2023

Last post on bonds: https://bartscharts.com/2023/07/30/bonds-july-30-2023/

Well, rates are spiking and bond prices are falling like a stone. Yup … and to think, folks, this is just wave one down. As discussed about a month ago, the target for this ending wave down is now around 110 is and then, still, the zone lower in the 98-103ish …Who knows, if you think about it.

IF my count is correct, THEN this will be a wave 2 in a bear market in bonds that could last years …and, if the recent wave 2 / b wave in the equities market is any barometer I believe this bounce will be BIG because the narrative of “inflation is under control” and the “fed is easing” and blah blah will come out and EVERYONE will think, that’s it and back we go to tinsel town. BONK.

Just counting … that ain’t gonna happen. Might we get some rate cuts in the upcoming bounce? Sure … Might rates naturally drift back down and blah blah blah blah – absolutely. Folks, it might seem that all is GREAT again.

But, it’s just wave 2 folks. Bonds have been going down for almost 3+ years … a 6 month to a year bounce – CERTAINLY in the cards.

So, I’m going to keep my TBT position ON as I’m going to ride all the waves (like UNG, cough cough – what the heck, why ain’t that thing moving …?) but I’ll be a BUYer of TLT for this bounce.

Why not? Nice bullish divergence on the weekly and monthly w/ some good targets. So, guess we’ll see.

NOTE: it’s getting pretty squirrelly out there … I’m pretty confident in these levels on the 30 year continuous chart. VERY in fact – one of them will stop this free fall. If they don’t, and the bonds fall right thru these levels – I’ll be shocked and awed. LOL … no kidding, the Bond market in a free fall is really an “other” on the good/other scale.

Eggs – August 17, 2023

Last post on Eggs: https://bartscharts.com/2023/02/14/eggs-february-14-2023/

Might want to buy up some eggs … if still bullish believe this measured move will be a low for eggs and then off to the races higher?

If we blow thru these levels to the downside then a larger correction is ensuing … for now, watch the .786 and the measured move.

JNK – August 16, 2023

Last post on JNK: https://bartscharts.com/2023/06/27/jnk-geometry-june-27-2023/

Well, we have a BUY PATTERN on JNK right around the “key” trend line … that’s been holding the Junk Bonds up for all of 2023 and the last quarter or so of 2022. It’s important .. doing “basic” trend line construction we can see the “minor” purple line will give us a heads up but I think Mr Red Trend line is the key … we lose that and I find it hard to get this market going higher for a while…but you never know, right?

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