11/10/2018 – overall, our key 75-76 level was hit and has caused the sell off. take a look at the charts below …
some critical developments:
- the XLE/NYSE Index ratio has hit a perfect BUY PATTERN so expecting the energy complex to bounce/hold/consolidate as this level holds. IF IT FAILS then the sell off will be pretty immense. So watch t his level.
- on the Crude, anytime you have a .382 and .618 (.382+.618 = 1) present that should act as important S or R. In this case SUPPORT. we have some polarity present also so ‘expect’ a bounce in Crude … will update accordingly.
- also, note the correlation between crude and HYG. (High Yield Bond ETF) … perhaps the carnage in Crude will stop at support levels indicated which ‘should’ keep HYG at bay (if the correlation is still holding) but if Crude busts thru then that support cliff for HYG should give away and then it will get very interesting
- also, put the oldie but goodie of the HIGH on crude on my birthday and the subsequent low to show some geometry at work and the fact that long term charts can certainly help .. .a famous quote “there is nothing new under the sun.”
thanks reading …. B
06/03/2018 – sorry that i didn’t send out the charts below via my blog .. honestly, I think I just forgot and then went on some travel …big thing here is we hit an important high a week or so ago based on TIME so this could be a very important top in crude.
honestly not sure if we have completed a 4 ( if YES we have BIG MOVE COMING lower) or an end to a bullish bounce and we are correcting to buy ..
either way, this should do it for crude for a while at least. will be watching and, again, apologize for not blogging earlier.
as an FYI, the charts are real time they were just sent out via email …
let me know if you have any questions.
this is the update as of 06/001/2018:
This company is about to launch and AMAZING ‘treatment’ called Epidiolex for Lennox-Gastaut syndrome, a rare, severe and difficult to treat form of childhood onset epilepsy. These children and their families are suffering thru up to 200 seizures a day. By dropping a couple of the Epidiolex drops into their mouth they are seeing amazing results.
Guess what – thee amazing treatment is derived from Cannabis. Period.
I am looking for a risk controlled entry for a long term buy and hold. The company is doing amazing things spinning out over 150 different chemical properties of this amazing plant based medicine.
No, we don’t have a bunch of kids baked while watching their Ipads … this is a natural based science relief …
Right now, we’ve completed some pretty hefty patterns so I’m looking for any pullback to BUY. Would really like to get this back to the ‘old breakout level’ for a BUY … note the MONSTER GAP on a monthly.
Pharma can be very wild based on FDA approval and Adverse Events and blah blah … but believe this company is onto something and the future is very bright.
I like Ratio Analysis … I also like to work w/ the patterns on these charts.
If you have been reading my blog for a while, you know that I ‘try’ (the operative word) to not read, watch or listen to any ‘other’ financial news commentary. Yes, there are people that I follow and am very interested in what they see/say (most are the same as me) but I can tell you that NONE of the people I follow or read are fundamental analysts. Not that they don’t do good work (they do) I’m just not smart enough to understand the information they put out. For me – it’s much easier to use crayons, some geometry and PRICE and TIME and PATTERNS to try to manage risk. The ‘why’ and the ‘blah blah’, again to me, is just noise.
so ratio analysis:
X/Y – if the chart goes up then X is stronger.
X/Y – if the chart goes down then Y is stronger.
X = XLK (technology = risk on) the Y = XLP (staples = risk off)
XLK/XLP – going up w/ strength. the big guys (institutions) aren’t showing a ‘risk off’ mindset. the XLK/XLP ratio move up is the LARGEST SINCE THE LOW OF 2002.
So, for me, while we might shuck and jive and perry left, perry right until we have a monthly bearish signal reversal candle I can’t join the camp of the sky is falling and all that jazz.
05/29/2018 – if you search ‘DB’ on my site you’ll see I’ve been watching this company for the past couple years. Why? Well, they are the largest holder of derivatives in the world and have so many ‘tangling alliances’ w/ the major global banks that they contain some serious systemic risk.
folks, this is getting really ugly … the probability of a contagion in Europe is growing larger every day.
watch the global flow of funds in the coming days … the ‘big money’ is going to have to go somewhere and, quite frankly, a big old position in the DOW 30 isn’t necessarily a bad thing is it? Yes, were going to get some global equity hits over the coming days weeks but ultimately, watch VOLUME and look for measured moves … but, for now and perhaps the foreseeable future stay out of Europe.
will update as we continue along …sheesh, the Eurozone is a hot mess.
11/2/2018 – ouch.
The area labeled ‘FAILURE OF PATTERN BELOW’ is one of those levels that ‘should’ have acted as extremely nice support for IBM. Guess the operative word is ‘should’ w/ regard to that last sentence. Take a look at that candle … boom. That folks, is what a pattern failure looks like.
so, if you look below, it’s now setting up for a support zone (dare I say BUY zone) in/around 88-89. I’ll do some more work on it over the weekend but the BUY PATTERN mentioned w/ @seeitmarket went the way of the buffalo.
certainly appears to be setting up for a nice one …
I’ve seen the very strong strength shown by IWM (ETF for Russell 2000) but I also see 5 waves and monthly bearish divergence. I’m not ‘sold’ on the bullish aspect of this ETF, yet. Let’s see how it deals w/ the 2 daily butterfly patterns (bearish) that are present right in the zone of the measured move shown on the monthly …
What I can say is that IF these patterns fail this puppy will, indeed, explode. But that monthly tells me … not so fast and be careful of the ‘no brainer’ trade being long IWM.
PS – for those of you who are geeks, like me, notice the close hovered around 161.80’s or the golden mean – 1.618. Note – our subconscious mind doesn’t worry about decimals points.
PS – 1.618 or 161.80 🙂
amazing week in Punta Mita Mexico … after my daughter got married my wife ‘allowed’ me to take some R&R. Worked hard for a week on my SUP skills w/ these guys: https://supnsurfretreat.com/
if you have any interest in Stand Up Paddle Surfing do this … shout out to Chris Sfor ALWAYS being patient w/ me. If I see you out on a wave this summer I promise I’ll at least know what a line up is … can’t promise anything else. Thank you, Chris, for the push.
before that saw 3 straight weeks of travel so I just ‘checked out’ of the markets for almost a month.
came back to the charts and what do I see … a PERFECT SELL PATTERN on the S&P. if your bearish, this is the level …
the only thing that is keeping me cautious and in a wait and see mode is the XLP/NYA ratio. Folks, it’s in full grunt liquidation mode. again, this ratio is a great harbinger of understanding institutional big guy mindset. IF they are risk OFF then the ratio should be going up if they are RISK on then the ratio falls – as it is now. note the support levels shown a little lower …until this ratio finds some stability and support I just can’t be overtly bearish….
good to be back – trust all are well.
06/03/2018 – quick update to the XLP/NYA ratio. Still waiting for a BULLISH SRC to signal a ‘institutional shift’ to risk off assets in the form of staples and this ratio finding support (XLP / NYA) and starting to rise. While we did get a BULLISH MONTHLY HAMMER CANDLE in May we still have lower targets so need to keep the ‘bullish mindset’ for now. Now, that being said, I added an RSI to the picture to get a feel for where we are …
1/ we are at the lowest levels seen since the 2007 financial crisis. yes, that’s true BUT take a closer look and you’ll find the ratio kept going down for 4 more years.
let’s don’t get complacent but, per my last post w/ the XLK/XLP let’s be aware of BIG TARGETS BEING HIT across the circle of life (bonds, commodities, currencies, GLOBAL equities) to see the pivot.
Eurozone is quite the mess right now … where can they go? Well, the US stock market doesn’t seem like a bad place now does it?
I’ll keep watching, closely, but this XLP / NYA ratio certainly appears to want to seek out the lower targets so that’s not bearish, for now.
if you’ve been following me for a while, you know I enjoy using advanced pattern recognition to ratio analysis.
for a bunch of XLP/NYSE Index analysis click here: https://bartscharts.com//?s=xlp+%2F+%24nya also here for @seeitmarket: https://www.seeitmarket.com/market-update-consumer-staples-xlp-nyse-composite-ratio-17676/
now, this most recent multi- week stock correction was ‘expected’ based on a zone of support coming in for the ratio. (see above link to read)
that being said, we did rally and now, of late, we have really started to sell off.
this means that institutional ‘mindset’ is showing ‘risk off’ or bullish market momentum.
this ratio has picked the ‘exact’ weekly/monthly pivots since it’s inception and the tops/bottoms of 2000, 2002, 2007, 2009, etc.
I trust it … it’s falling out of the sky is telling me that, while some selling pressure might still be present, the BIG BOYS haven’t sought cover … (when the crap is hitting the fan they seek staples) so while this ratio appears to being LIQUIDATED the big boys aren’t ducking and running for cover yet.
THESIS: consolidation/correction to occur or maybe even rally BUT we are going to see the RATIO keep falling, especially if we close below and fly thru the 7 years support zone …
sorry folks, no massive sky is falling or this is it from me … until this ratio finds BIG support and takes off like a rocket I need to remain on the bullish side of the fence … for now. Just calling it like I see it. Honestly, DID NOT expect such a BIG sell off in the ratio. But, guess what, that’s what its doing …
let me know if you have any questions …
PS – note the CYCLE (basic) time rolls into sometimes this month of April. And, we are in April so stand buy …