Market Update

To my eye this market has been stuck in a rut and doing nothing terribly interesting nor particularly noteworthy for several months.  Today, as we finally get an upside breakout in the big range, I thought it might be fun to take a look at the Big Picture via the three major timeframes and to maybe toss out another rant about what I think has been causing this multi-month compression and malaise.

 

First, the rant…

<rant/>

Longtime readers here know that I am an early supporter and big fan of the President.  This guy stepped away from the ultimate billionaire lifestyle to take a thankless and extremely difficult job for NO PAY! …and never in the history of this Republic has anyone been more abused and mistreated than him.  Yet, each day he gets up and continues to try to make this a better country by making pro-American policy decisions and striking deals that truly improve the lives of average Americans.

It should be clear to most by now that the our government, the dinosaur media, and the entertainment industry have all been thoroughly compromised by anti-American entities.  One doesn’t have to venture far to connect the dots and end up staring straight at the Communist Chinese as the likely top-level protagonists.

In a quote often attributed to Joseph Stalin “When it comes time to hang the capitalists, they will vie with each other for the rope contract.”  So true! …and that is the path we have been on for several decades!  However, along comes an amazing man who has bravely confronted the massive scheme to sell out the country–and he threatens to not only cut off the cash flow for bribes  (largely by initiating a brilliant tariff strategy that the woefully corrupt US Congress cannot touch) but also threatens to expose the very network of traitors who have been selling out America.

The Globalist Socialists, who are all motivated by money at their sinister greedy cores, have been parasitically feeding off of the United States for decades.  Their plan was to drain the host of life completely and then swoop in with their glorious (for them and certainly NOT for us) ‘New World Order’ that Bush the Elder started to usher in during his installment after the last ‘accidental President’ and outsider, Ronald Reagan.  They successfully installed an uninterrupted succession of stooges and all was going exactly to plan until Donald Trump stepped in and beat the most hatable candidate the NWO could possibly put forward.  It was her hubris, arrogance, and incessant bullying that enabled Trump to be miraculously elected against a completely stacked deck.

The election of 2016 has sent shock waves through the evil empire and they have spared no effort in activating (and ultimately exposing) their bought and paid for agents and assets.  So many ‘conservative’ pundits and politicians have had the mask ripped right off of them as their masters demand that they stop Trump.  NONE of it is working.  President Trump continues to out maneuver and out-smart them.  The most recent example is the middle-east strategy that has extracted US troops, killed the top ISIS threats, taken the oil, and left the Russians holding the bag standing between ancient and never-ending Sunni/Shia warfare stupidity.  For example, how ridiculous do those concerned and outraged ‘Republican’ critics from last week look now after President Trump pulled off his latest brilliant maneuver?

The globalists have a real conundrum when it comes to dealing with President Trump.  They have assumed control of many if not most multi-national corporations often via lax mergers and acquisitions accommodated by corrupt public officials.  The wildly successful tariff implementations by President Trump have totally reversed their plan of siphoning wealth away from the US into a global rush to invest back into the US.  These corporations are in essence trapped into repatriating capital investment back into the US and away from China predominantly.  The more China bleeds jobs and precious hard capital, the less able they are to buy influence around the world…and also, the more hostile average Chinese citizens will become toward the current communist regime as living conditions deteriorate and prospects diminish.

As China and other hostile economies contract they are forced to weaken their currency in an attempt to offset the tariff cost to stay competitive in trade volume.  In essence, Trump has brilliantly exported inflation to the enemy economies and America is adeptly side-stepping what ‘leading economists’ said would be rampant price inflation as those import tariffs are enacted.  To the chagrin of his enemies, his tariff policies are proving to be wildly successful, and to put it bluntly, America’s primary nemesis, China, is totally screwed.

Ironically, the global socialists would love nothing more than to crash the American economy to weaken Trump’s support, which is his number one triumph–but they can’t!  There is currently no other place for capital to flow to seek a better return, so try as they might–they just can’t make this incredible economy sink without simultaneously hurting themselves.

It is my opinion that the sideways action we have seen for the past many months has been a mass paralysis by major market participants as everyone waits to see if any of the various ridiculous charades employed by an increasingly desperate opposition will stick.  This could be a race by them to try to remove president Trump (by any means possible) before the good guys regain control of the DOJ, FBI and CIA and the heinous acts of selling out America are exposed.  The ones screaming the loudest against Trump are likely the ones with the most to lose when the facts eventually come out about the massive plot to take down America.

As I said in a post here long ago when I predicted Trump would be elected President shortly after he declared his candidacy… this administration was never going to be dull, and the immense drama has certainly not disappointed thus far!

One last thought here… I was talking to a friend yesterday who was disturbed about the ridiculous tenor and hysteria of the ‘news and noise’ and I remembered something that a historian told me at Colonial Williamsburg many years ago… He said that over time things really haven’t changed all that much and never really do.  At the time of the American Revolution, for example, the public opinion was about 40% loyalists and 40% rebels (or patriots depending on your perspective).  That left 20% undecided.

Today, I think things are about the same.  There are 40% on one side and 40% on the other whose opinions and positions are fixed and absolutely unchangeable.  What is left are the incredibly insipid dolts ‘in the middle‘.  The battle we see playing out now in the media is not intended for the 80% who have already decided their loyalties–but rather, this is an all-out attempt to sway the 20% and if possible, to discourage turnout from the ‘wrong (in their opinion)’ 40%.  So relax, sit back and enjoy the show.  It’s all pretty darned entertaining when viewed from the proper perspective.  Just be sure to show up and vote when the time comes!

It is going to absolutely kill the Trump haters to see the new all-time highs in the market today on the news.  The globalists hate it too because it further strengthens the power of their nemesis, but ultimately they love money more than ideology and President Trump is in the process of bringing them back around to the right side with the proper carrot.  As a businessman and self-made billionaire, he truly understands how this works.  Donald Trump has always given prior enemies every opportunity to switch sides, but if they still persist–>then more often than not they will end up a bit like the ISIS dude in the tunnel in Syria last weekend… ripped to shreds and self-immolated by his own hand!  It’s really a thing of brilliance to behold, and the world has never seen anything quite like it.

</rant>

 

Okay, with my cathartic rant out of the way let’s take a quick peek at the ‘Big Picture’ market structure…

 

From Stops and Targets, we can see that the S&P 500 Futures have broken out to a new all-time high.

Take a peek at how close together and compressed those three stop/reverse lines are!  That is the result of months of sideways price action.

It would take very little to crash right back down through all of those to flip all three trend bearish–so keep a very wary eye on Top Spotters in case we get a run of the bear stops above the old range high  and then a hard reversal back down.  If something interesting happens, I’ll be sure to point it out here.

At any rate, it’s all good for bulls above those stop/reverse lines–> but potentially very serious if we get a stop sweep/reversal back down with massive numbers of spotter signals for confirmation.

It has been a great run from the last confirmed Bottom Spotter after last Christmas.  The broad market is up > 30% since!

 

 

 

 

The chart above uses monthly bars to illustrate the long-term timeframe.  Note the bounce from the VLT (very long-term) trendline back at Christmas.  That initial rally run stalled in May (sell in May and go away) and price has criss-crossed that high multiple times since.  Note that the game has been alternate stop-running in almost every month since.  It has been a brutal time for trend followers–but an absolutely great time for range traders.  The great news about S&T is that the counter-trend range envelope signals have been absolutely spot-on.

 

 

The chart above uses weekly bars to illustrate the intermediate time frame.

Note here that the weekly paradigm hard deck is presently located at 2,777.50.  The major bullish paradigm that has been in play since the 2009 bottom remains intact above that line.

If price continues to trade above 2,855 through the remainder of this week, the trailing stop hard deck line will move up to that level to lock in more gains on that trade.

 

 

 

The daily bar/range chart above adds the short-term timeframe, but also shows intermediate and long-term levels.

The major number in play right now is the all-time high breakout line at 3031.25!  A move back below that line would generate a counter-trend sell signal in all three timeframes–so that’s a biggie right now.  Counter-trend signals work great in a trading range–but if the market starts to trend again in the long term then the range traders will get run over, so be wary.

…my .02

 

 

 

 

 

 

Options Rollover Day

Futures Options have now rolled over from the September 2019 to December 2019 contract with a difference of +1.75 points from ESU19 (September) to ESZ19 (December).

All previous chart numbers have been adjusted to reflect the new contract pricing—so, for example, the Intermediate Term stop/reverse line from the expiring September contract at 2939.75 now becomes 2941.50, and so forth.

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I have included my updated Daily Bar/Range chart above to provide a visual confirmation for what Stops and Targets is saying in the screenshot at the top of this post….

We are still riding the major parallel channel bottom bounce from August 6th (see the blue arrow on the chart above), and the S&P 500 Futures have just hit resistance at the top of the current Long-Term range envelope at 3016.

We will see what happens at this resistance touch here at 3016, which will initially trigger profit-taking from the black box algorithms, but all trends are up > the Short-Term Stop/Reverse Line, which is currently sitting at 2973.75.  A future move below that line, of course, would start to flip momentum bearish, with the Long-Term and Intermediate Stop/Reverse Lines sitting beneath at 2957.25 and 2941.50 respectively as downside targets once a pullback begins.

If bulls can power through profit-taking resistance at 3016, the next major target higher would be the all-time high at 3031.25

As always, there is a huge resting trove of buy-to-cover stops from bears, resting just above, waiting to be harvested.  Those stops represent guaranteed buyers for the pros on the other sides of their trades–until such time as those resting stops are actually owned by the pros.  We usually know precisely when the pros flip sides using Stops and Targets’ Top Spotters as our canary in the coal mine.  So far, we have not seen any indication of unusual Index, Futures, and Russell 3000 Spotter Signals.

 

<rant on/>

As much as the globalists would love to crash the market in an attempt to help their side in a continued all-out attack on the current administration, President Trump’s economic advisors have brilliantly trapped globalist ‘elites’ (laughing here) into a checkmate situation.  After all, the entire point of pushing so hard for global socialism is to concentrate immense wealth in the hands of a very tiny group of individuals.  As a result of clever maneuvering by Presidents Trump, using tariff policies, these folks are now locked into a lose-lose conundrum…

The source of their power is wealth.  If they crash the market, then they lose their wealth, which diminishes their power.  See how that works?  😎

Hey China… how’s that whole anti-American thing going these days for you?  Less money for China, primarily as a result of Trump’s crippling sanctions (which are completely out-of-reach from the filthy-dirty foreign operatives embedded in our government) means far less obscene piles of excess capital available to finance myriad global schemes to undermine the USA from any and every angle.  When the Chinese hard currency reserves eventually dry up, the Chinese people might just decide one day that they have had quite enough of their current ‘leaders’.  The entire Chinese economy will inevitably collapse once they are no longer able to wantonly steal from the USA.  As Margaret Thatcher famously said,  “The problem with socialism is that you eventually run out of other people’s money.”

This is an absolutely fascinating period in history, and Donald Trump could ultimately turn out to be one of the most consequential world leaders of all time!

The globalists won’t go down without a fight, however, and we have been witnessing them throw absolutely everything and everyone they have at this guy for the past 966 days trying to desperately stop him from dismantling their long-running Orwellian schemes of global destruction and subjugation (for all but themselves, of course).

Love him or hate him, anyone with an IQ above room temperature simply has to be impressed with President Tump’s tenacity and resiliency under constant and relentless fire.  This incredible man, and his top key advisors, don’t even accept a salary for their tireless work under such brutal conditions!  They are America First Patriots who simply can’t be bribed (like many in the pathetic US Congress, for example) and the globalists seem powerless to stop what is coming.

The teeny-tiny group of globalists are clearly in an all-out panic, and so we normal folks have to stay diligent in protecting ourselves from their reflexive spasms.

I think it is amazing (and hilarious) to watch the globalist operatives being one-by-one systematically exposed, only to self-immolate after being outed.  For example, The (Fake) News and Noise is and always has been pure propaganda.  Trump, adroitly, has forever exposed them and they will never again be able to influence as they once did.  President Trump clearly realizes that the media, along with corrupt politicians and judges, are the front-line foot soldiers of the enemy–and he is dealing with them accordingly, and effectively.  Once the front line pawns have been neutralized, then the slow wheels of justice can start reeling in the tiny group of actual instigators, who are currently quivering in fear behind the curtains.

I predicted that Donald Trump would be President immediately after his announced candidacy.  For fun, I am going to again predict a future political outcome, with just one caveat…  If rampant voter fraud can be contained, the upcoming 2020 election is going to be eerily similar in outcome to the 1980 one.  This is going to be a blowout of epic proportions.  If that happens, we are going to have some great years directly ahead of us during the second term of his Presidency.  The Reagan Era was great for nearly everyone… but the Trump Era, by contrast, is going to be simply amazing!  You’ll see.

I am certainly not saying there will not be some significant bumps in the road ahead, but once these vile globalist bastards are finally dealt with, it is going to be a much better world for all.

</rant off>

 

The Stops and Targets Stop/Reverse Lines will tell the tale going forward, and we are all good on the bullish side above the Short-Term line, which is currently at 2973.75

…my .02

 

 

 

 

 

 

 

Market Update

 

Following up from my last ‘head’s up’ post (bounce alert at the parallel channel bottom at ES 2775.75)…

We are now into the fourth poke above the key resistance level I pointed out last time at 2914.50.  The market has been stalled here as the pros have likely been diffusing the options premium exposure they had going into last Friday’s monthly expiration (August contracts).  That event is in the rearview mirror now, so it’s time again to start preparing for what is ahead.

 

Let’s take a peek at what Stops and Targets has to say and compare my daily bar/range chart above to what we see over there…

 

(FYI:  My daily bar/range chart at the top of this post shows the same three timeframes (LT, IT, ST) along with the associated ranges and stop/reverse lines.)

 

The way I ingest the information from Stops and Targets is to look first at the Stop/Reverse Lines chart, (which is always selected by default, alongside the summary tab, when any new symbol is entered)…

 

A quick glance at the chart for the S&P 500 Futures (symbol ES) shows me LT and IT are currently down, and ST up–by just noting the color of the stop/reverse lines.

Those same stop/reverse lines take the mystery out of momentum regardless of whether the timeframe is trending or rangebound.

The three range envelopes are shown on the Stops and Targets chart as dashed gold lines.  I can quickly see that the current price is trading below the bottom of the LT range (2955.50), rangebound inside the IT, and is trending ST bullish above the range bottom.  A move below that line would flip the ST trend to bearish.

So ‘head’s up’ right here at 2904.25

 

Now that I have the ‘Big Picture’ framework established from a glance at the chart, next up for me is to glean the finer details by looking at the summary tab details…

 

 

I start by reading the Summary overview tab (which is always selected by default)…

 E-Mini S&P 500 Futures Option is rated BULL 1, the first stage of a new uptrend progression in an extended long-term bear market. Although the short-term trend has turned up and is mildly bullish above 2,904.25, the long-term and intermediate trends remain bearish. The line that must be exceeded to move to the next level of bullishness is intermediate trend resistance at 2,940.75. In a continuing long-term bear market, sellers will typically step in at or near that number–but in a strong rally that resistance will eventually break as new buyers expecting higher prices emerge.

 

I next take a glance at the range envelopes chart at the top of the page…

The screen capture above tells the current market tale well…

Starting with the arrows to the left of each range envelope we can see from the that there was a bearish trend change at 2955.50 which happened on 01-Aug-19.  The intermediate symbol indicates ‘rangebound with a bearish bias’ (below the IT stop/reverse line).  The symbol indicates that the short-term timeframe is trending bullish above the 2904.25 range bottom.

 

This market has stalled and is likely coiling for a breakout ahead and the weekly range will determine which way we go from here…

 

 

Once the market is closed today, the weekly range will be determined by the high and low of this past week.  If the current range holds, those intermediate range confines will be 2892.50 to 2939.75

The current weekly bar is an ‘inside bar’, which means both the high and low are constrained inside of the prior week’s range.

An eventual pop above intermediate resistance could lead to a run for new highs, but until/unless we get a breakout above that line the intermediate trend will begin to trend bearish with a succession of lower highs.

 

Weekly Paradigm Update…

We will need two more weeks before the next higher low is officially set on the amazing weekly paradigm that I have been pointing out regularly here since the 2009 lows.  If we can stay above the provisional line at 2775.75 that will become the new hard deck in two weeks.  Until then, the current Weekly Paradigm hard deck remains at 2372.75

 

This market appears to be coiling while waiting for something big to happen…

 

Could this be a clue?

Have a great weekend everyone!

…my .02

 

 

 

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Market Update

 

S&P 500 Futures are currently bouncing off the parallel channel bottom (see dashed blue lines on daily bar/range chart above).

As pointed out in yesterday’s post, the first key upside line to cross was yesterday’s low at 2820.50, which is the short-term range envelope bottom.  That line is located at the bottom of the short-term range, which is highlighted in bright yellow on my chart above…

 

A cross above the short-term range envelope bottom at 2820.50 has generated a range bottom counter-trend buy signal where the most aggressive bears started to take at least partial profits (see screen capture from Stops and Targets above).

Next upside counter-trend price target, if this bounce can stick, is confirmed resistance at 2914.50.

Head’s Up!  ES 2820.50 is the line in play today for the S&P 500 Futures.  Intraday price action is bullish above –> but reverts back to bearish below.

…my .02

 

 

 

 

 

 

 

 

 

Market Update

The Dow Jones Industrials opened the new week down -500 points on a futures-driven beat-down (S&P Futures opened down -50 points).  This move piggybacks the setup going into last week’s FOMC rate announcement.  This (in my opinion) is the pros doing their thing, post-FOMC, and so the game here is to figure out what they are targeting to the downside on this forced move lower.

The headlines blame this overnight beat-down on a counter-move by the communist Chinese to allow the Yuan to depreciate above 7 on the exchange ratio to the Dollar for the first time in a decade.  This is China’s retaliatory move to counteract President Trump’s devastating (to them) import tariff strategy (which is Great for US).  Key US exporters are leading today’s decline, of course, but if you are in the market to buy some cheap Chinese import junk, then the good news is your prices just dropped a bit.  Ultimately, however, the Chinese will lose this battle as America holds all the economic ‘Trump’ cards.  The Chinese continue to absorb the costs and effects of the transition, while the US continues to strengthens its economic base with increased domestic manufacturing.  It’s a brilliant strategy and is being executed flawlessly.

It was inevitable that the collapsing Bush(2)-Clinton-Obama era strategy to weaken America, which is now coming unwound with a Make America Great Again economic squeeze, would eventually create some panic in their circle of accomplices/associates (and bribe suppliers).  The global socialist strategy of impeaching/removing the outsider/disruptor (Trump) appears to have failed miserably, and so now we are seeing screeches and wild flagellations as the old ‘new word order’ (thanks Bush I) continues to come unwound.  Good riddance, I say, but choking off this abomination won’t come easy and these people will stop at nothing in their attempts to maintain a rapidly-slipping grasp on their horrific vision of global socialism/communism–> where a tiny cabal of global overlords prospers (them) while everyone else (us) suffers.

 

So, let’s take another look at where we are, technically, after losing bullish support in all three timeframes…

 

 

Stops and Targets shows a Bear 4 rating for the S&P 500 Futures and 2,955.50 is long-term resistance.

Next S&T major target lower is 2,732.75, which is nearly 5% lower as I write.

So, here is how the pros likely will trade this decline (in my opinion)…

The key numbers going forward will be the previous day’s low and high.  In a decline, the first counter-trend buy will come on a cross back above the previous daily bar low.  That might be unlikely to happen today (2,913.50 was Friday’s low), but if not today, then it will eventually happen on a subsequent day.  A cross back above the previous day’s low (in a downtrend) is where the most aggressive bears will start to cover at least partial profits.

If/when we get a day where a rally crosses back above the previous day’s high, then the most aggressive bears will be getting completely out of short positions and the momentum bulls will jump in on the trend change to double up buying volume.

So, remember to watch the current short-term range envelope numbers for those eventual crossovers for a clue when the reversal starts.  Reread the first sentence of this paragraph and remember that–it’s very important from this configuration!

This ‘feels’ like a forced/planned correction to me since there were no unanimous spotter signals triggered at the top, but it’s fully-bearish here until it ain’t and the previous day’s low is the first line that must be crossed to potentially start to flip the momentum.

Remember also that our Weekly Bar Paradigm ‘hard deck’ is currently sitting at 2,732.75, so that’s the edge of the wiggle room for a significant correction before this pullback/decline potentially turns into something much more ominous.

The previous bullish trend change numbers after the last major pullback were at: 2,845.25 (intermediate), 2,767.75 (short-term), and 2,722.50 (long-term).  Those are the full trend reversal/breakout retest targets lower.

A big fist bump here to all my bearish friends who caught this downdraft entry from the setup in my last post at 3,001.50!  Keep an eye on the short-term (daily bar) range envelope as explained above.

…my .02