Is it safe to go back in the water? Merely asking that question is to suggest that only an imbecile would dive fearlessly back in the drink. Even so, there are most surely enough imbeciles to keep stocks buoyant in the days or even weeks ahead. If they eventually are joined by panic-stricken bears as sometimes happens, we could see a rally capable of persuading otherwise sane folks on the sidelines that new record highs await. ‘Trader Mike’ caught a fascinating aspect of the game in the chat room today with this wry observation concerning market psychology: “Markets require people to give up. Read the Turtle book. The Turtles got their brains bashed out trading coffee, then they decided to stop trading coffee, then it produced the largest single trade in the history of mankind. That’s how it works. I exaggerated a little. I’m sure Bitcoin is the largest trade ever, but you get the idea.”
‘Markets Move After Everyone Has Given Up’
- October 31, 2018, 6:03 am
Stock Market Failed Rallies are in fact ‘sellers using any strength to liquidate stocks.’ Every sector has fallen.
Great Depression stat:
Unless the S&P 500 closes green today and tomorrow, this will be the first time in history the month of October doesn’t have back-to-back gains.
Today will mark the 28th consecutive day the S&P 500 doesn’t have back-to-back up days. Tying the longest streak since the Great Depression.
Change Creates Fear 10302018
https://variety.com/2018/tv/features/tv-salaries-top-stars-2018-1203008118/
Change, any type of change, creates great fear and those that have ‘much to lose’ the above link is a window towards those that have the greatest of fear today. They do not want change in any way the road is paved with gold for them over the last 3 decades.
The Trump Low is an important low for many reasons, it ‘is’ there that many see and had seek ‘great change’ on both sides of the money machine. Few today if any can think of this low to be broken. So, they are ‘protesting’ towards this low point, this level is the biggest ‘stop lost’ in all financial history it is a ‘blow off’ stop low point’.
———–The world major indexes top out 11 months ago in January 2018 and have all ‘confirm’ the breaking down of every sector and its last extreme low point recently. World markets are way ahead and all in bear markets.
The world markets see the DXY as a ‘safe haven’:
Daily Sentiment Indicator (DSI) has been quantifying sentiment across U.S. futures markets every trading day since April 1, 1987.
The DSI scale ranges from a low reading of 1% bullish to a high reading of 99% bullish.
On 8/14/18, the DSI for the U.S. Dollar Index measured an eye-popping 96% bullish.
To give some perspective to how rare a 96% reading actually is, during the entire 7,966-trading-day history of the DSI for the U.S. Dollar Index, the buck registered a more bullish reading on exactly five days.
GC market as of 8/13/18 DSI for spot gold registered an almost-as-rare reading of 6% bullish (94% bearish).
During the entire 7,938-trading-day history of the DSI for spot gold, a more bearish reading has occurred on only 48 days.
The recent 2 top DXY high here (this pass 2 weeks) is a major selling level as it has and is in a prolong bear market ‘in years’. The course of the GC end of month (Oct 2018) sees a major ‘Morning Star Pattern’ a major BUY long term, short term and any term as its targets all time highs. A ‘double’, then another ‘double’ into a major world ‘bubble’ in pricing in the coming years, it’s 2000/ 2001 all over again.
In the pass year or ‘2’ secondary currencies have ‘adjusted’ towards the started ‘currency war’ that started in 2010 and 2011 as they have sky rocketed, the majors will follow towards new all time highs. The starting of a major recession in the USA started in 2015/16 a major 3 year trading range low ‘ago’ point is another lower ‘stop loss’. Forward of 2015/16 (the Trump Low break out) pricing high had been cause by ECB,FED, and BOJ liquidity pumping placing and creating a major ‘blow off’ ending the longest bull market in all financial history.
Today this turning point, in the last 20 trading days +/- is running in time and price 2 times faster in both than the 2007/08 bear market, it is much worst then many can see. This places the turning point in ‘volatility’ to be one of the top 5 in ‘volatility’ over the last 100 years. The ‘false’ 35 year trend line breakout in yield will again move sentiment towards yield even greater as all time shorts in every yield market to unseen levels never see before. ED (euro dollar) has a 1 year and better COT short build that is off the charts. Once capitulation of the 2,5,10 and 30 year market take place observe a new all time yield, and a long term depression like target in the prime rate at the 1% level.
This stock market is and will remain a ‘STOP LOSS’ market to longs.
Bear Markets go down on ‘buying’ not ‘selling’, that ‘buying’ is done by the ‘many’.
Have a great day Rick.