215 replies to this topic

[dTraderB]

Another relief bounce possible after the "good" FED Rate hike of 25bps, not as bad as it could be.

 

But, the Final Painful Leg Down will be coming -- who knows precisely when? 

 

"This past week world stocks ex-U.S. gave up all pandemic gains. Next week Russia will very likely default the same day the Fed raises rates:"

"....Wednesday could mark another low. The government is due to pay $117 million on two of its dollar-denominated bonds. But it has been signalling it will not, or if its does it will be in roubles, tantamount to a default. read more

Technically it has a 30-day grace period, but that is a minor point. If it happens it would represent its first international default since the Bolshevik revolution over a century ago..."

https://www.reuters....sia-2022-03-11/

[pdx5]

While my grocery store can not find workers to stock shelves for $16/hour to start.

[K Wave]

My thinking is that the huge milti-timeframe throwover on Rusty on Friday is the trigger for that final wave.

 

Depending on how badly AAPL and TSLA get hit, it could potentially be a panic down type wave.

 

Likely only thing that prevent that is a big up day on Monday, which I do not expect at this point...but always willing to change my mind based on new evidence...

 

I think the late action on TSLA on Friday showed the bulls are essentially out of ammo, and that close below 800 is going to now lead to a brutal move down....

 

In any event, if the long red ones DO start printing on Monday, I would would certainly not step in front of it...THAT knife could be very sharp if you try and catch it...

Edited by K Wave, 12 March 2022 - 10:58 AM.

[dTraderB]

Started this while doing my weekly data updates, maintenance etc but had to leave before I finished. 

 

 

"Market Review – Stocks Break Support

As has been the case all year, market volatility remained constant this past week. Stocks surged early in the week on hopes of talks between Russia and Ukraine, but hopes faded into Friday. Notably, the S&P 500 index broke the main support level of the January and September lows.

That break sets the market up for a retest of the lows set when Russia initially invaded Ukraine. A failure to hold that low and we are looking at a 161.8% Fibonacci retracement from the all-time highs, which would be roughly 4000 on the S&P index.

As we will discuss momentarily, there is a high probability of an outsized reflexive rally over the next two months due to several factors.

• Extreme negative sentiment
• Bearish portfolio positioning
• Higher levels of cash holdings by fund managers
• Dumb money is bearish
• Put/Call ratios are offsides
• Number of stocks trading at 52-week lows.

As shown, individual net bullish sentiment is at levels usually seen near market bottoms.

While we expect a significant rally from current levels, likely following the Fed’s meeting next week, such should get used to reduce risk and rebalance exposures accordingly. The market is currently very off-sides regarding money chasing the “inflation trade” and dumping everything else. Historically, such a “one-sided” trade sets up a rather severe rotation in the other direction.

As discussed below, we continue to reduce our exposures to consumer-related risk, are holding excess cash levels, and looking for opportunities to rebalance allocations at better levels.

There is a rising risk of a recession, and if this is the first leg of a bear market phase, we should expect a rally.

Before we go there, did you miss the most significant jump of the year?

 

https://realinvestme...ke-the-revenant

[dTraderB]

SPX 3800 could be reached by end of Match

 

Bottom Approaching, But One More Painful Leg Lower Remains

Tom Bowley |  March 11, 2022 at 06:32 PM

 

We saw the latest CPI report (February) released on Thursday. It came in about as expected, with the February Core CPI rising 0.5%, matching consensus estimates. That sent the annual core inflation rate HIGHER (as I've previously suggested) to 6.4%, the highest rate we've seen in more than 4 decades. The media, once it grows tired of the Russian-Ukrainian war, now has new inflation material to work with.

The high volatility ($VIX) and the big swings back and forth characterize the late stages of a cyclical bear market. The characteristics of our current market environment and that of the 1990-1991 cyclical bear market are remarkably similar -- almost eerily similar. I believe studying this period would do all of us a lot of good right now. Let's talk about 1990.

https://stockcharts....ne-mor-822.html

[dTraderB]

"...The Federal Reserve meets on Tuesday and Wednesday of next week. Fed Chair Jay Powell is set to embark on the wrong policy, in my opinion, of raising rates, which will be the final nail in our economic coffin. That, combined with soaring crude oil prices and declining consumer sentiment, will throw us into a mild recession -- similar to 1990. But I wouldn't expect the stock market selling to be mild. In fact, I'm looking for the decline to accelerate in the second half of March. If I'm correct, it'll represent a great opportunity to reverse course and switch from short selling back to the long side as the reward-to-risk will turn decidedly in favor of the bulls. I fully expect that later this year, after our economy has weakened, the Fed will reverse whatever rate hikes they chose to fight inflation."

 

https://stockcharts....ne-mor-822.html

 

SPX 3800 could be reached by end of Match

 

Bottom Approaching, But One More Painful Leg Lower Remains

Tom Bowley |  March 11, 2022 at 06:32 PM

 

We saw the latest CPI report (February) released on Thursday. It came in about as expected, with the February Core CPI rising 0.5%, matching consensus estimates. That sent the annual core inflation rate HIGHER (as I've previously suggested) to 6.4%, the highest rate we've seen in more than 4 decades. The media, once it grows tired of the Russian-Ukrainian war, now has new inflation material to work with.

The high volatility ($VIX) and the big swings back and forth characterize the late stages of a cyclical bear market. The characteristics of our current market environment and that of the 1990-1991 cyclical bear market are remarkably similar -- almost eerily similar. I believe studying this period would do all of us a lot of good right now. Let's talk about 1990.

https://stockcharts....ne-mor-822.html

[K Wave]

As shown, individual net bullish sentiment is at levels usually seen near market bottoms.

If you actually look at the chart, you will notice the sentiment bottoms have come BEFORE the final washout leg on the last 3 rounds....

 

So yeah, we are close timewise...price may a different issue entirely....

 

I think Russ may be onto something with his 1st week April projected bottom...

Edited by K Wave, 12 March 2022 - 08:02 PM.

[dTraderB]

"....I still maintain an expectation for us to rally to the 5500SPX region. The only question with which I have been struggling is if the current pullback has completed. And, once we rally through the 4300-4350SPX resistance region, we will likely have begun the next bullish phase.

However, if the market is unable to hold the 4170SPX region again, then it makes it much more likely we have not completed this pullback, and we can test the 4000-4050SPX region before this pullback completes. But, make no mistake about it. Sentiment is at extreme negativity that usually marks major bottoms in the stock market.

But, as I also noted to my members:

So, while the market environment in which we currently reside certainly does not make you feel good, try to review the analysis and sentiment indications with a certain amount of objectivity. Now, far be it from me to try to convince you of doing something which makes you too uncomfortable. So, if you still disagree with my assessment, then feel free to remain on the sidelines until the market provides us with greater clarity in its smaller degree wave structure. While I can certainly be wrong, I am simply trying to convey to you what I see in the market based upon my experience. For when sentiment turns towards this negative of an extreme, it almost always precedes an impending major rally. And, I believe the next time we move through the 4300/4350SPX region will likely signal the resumption of the bull market.

Sentiment Speaks: OMG - It's A Bear Market https://seekingalpha...omg-bear-market

[dTraderB]

I agree with the SENTIMENT aspect of this analysis below. But, spike down can hit SPX 3800 OR LOWER.

[dTraderB]

Also, I agree ES 4340/60 is an important resistance/support zone, and if ES DROPS BELOW 4000 then 4070/80 will be the important resistance zone for a successful reversal.

I agree with the SENTIMENT aspect of this analysis below. But, spike down can hit SPX 3800 OR LOWER.

"....I still maintain an expectation for us to rally to the 5500SPX region. The only question with which I have been struggling is if the current pullback has completed. And, once we rally through the 4300-4350SPX resistance region, we will likely have begun the next bullish phase.

However, if the market is unable to hold the 4170SPX region again, then it makes it much more likely we have not completed this pullback, and we can test the 4000-4050SPX region before this pullback completes. But, make no mistake about it. Sentiment is at extreme negativity that usually marks major bottoms in the stock market.

But, as I also noted to my members:

So, while the market environment in which we currently reside certainly does not make you feel good, try to review the analysis and sentiment indications with a certain amount of objectivity. Now, far be it from me to try to convince you of doing something which makes you too uncomfortable. So, if you still disagree with my assessment, then feel free to remain on the sidelines until the market provides us with greater clarity in its smaller degree wave structure. While I can certainly be wrong, I am simply trying to convey to you what I see in the market based upon my experience. For when sentiment turns towards this negative of an extreme, it almost always precedes an impending major rally. And, I believe the next time we move through the 4300/4350SPX region will likely signal the resumption of the bull market.

Sentiment Speaks: OMG - It's A Bear Market https://seekingalpha...omg-bear-market