On the Bubble

Okay we're on the flight path to a landing, and in pilots' terms we are on the bubble, that is on flight path with the correct wing, nose, and flap alignments. Bob Prechter said once that the stock market is the economy, but like most of his axioms, that hasn't held up well. That's worth …

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AI Mania

The bear gap at 420 closed and that leaves the bears in charge. Ultimately this could be more bearish than if the gap remained open, as long as the gap remains open, the counter rally to close the gap remains the preeminent move. To resolve the bear gap the market needs new highs, or price …

50/50

The technicals are doubtful. There's a resistance line (red dots) which was already broken but came back into play. Three taps is the magic number, now trying for five? In money flows the usual suspects. A/D continues to climb, most merciless bringing of the money ever, EVER. The whales are swimming in the bait tank, …

The era of self-delusion

The circle on the left is steeper than the circle on the right, therefore inflation is declining? Investors are buying bitcoin against the collapse of the dollar. But the stock market isn't rational, the A/D represents all the wealth accumulated to this point, being rolled over and in some cases incinerated into cash. Cash is …

New twist or an exhausted rally

The setup in the downtrend from Dec 22' - Oct featured similar setups, each of them resembling a H&S top pattern, on a downtrend base line which broke, taking prices lower. The result in each case was lower prices. Since the Oct bottom the feature of these H&S patterns has been the declining base line, …

Yield Curve and the SPY

This study, for academic purposes, goes from the last day of April until the 5th day of May. I used the widest possible spread in yields, the 20 year and the 1 year. What I found was a correlation between a rising and a falling yield curve, 20y-1y, and rising and falling stock prices. In …

Programmed Descent

Several analagous patterns. The patterns are either descending head and shoulders or expanding megaphone formations, or a little of both. If the pattern of green circles holds then we should have a reflex move, probably off the 50dma and the trend line. We cover the gaps in the next chart. The money flows are synchronized, …

Forget it Jake, It’s Chinatown

Interesting that this line draws so much analysis. This process of interpretation of the obvious, the "What do you mean?" retort which is too often used when someone is stating a concrete or obvious fact. We don't imagine Jake's next line would be, "What do you mean?". "Chinatown?"... The phrase is a metaphorical statement, there …

A Bareish Take

FOMC week and the threads are all laid bare. The Fed could raise another quarter point, and backpedal the hawkish jibe and the markets would love it. Apple can say anything they want, (they are looking to rollout the good news later this year but what the hell, IPHONE fifteen, but let's buy the rumor …

Choreographing the Next Crisis

There is this witty fellow who covers the horse racing scene in California, Bob Selvin. He was once asked, "Are the Horse Races fixed?" His answer was, "No, but they are Choreographed..." Myself, I feel the racetrack gives the little guy a much better shake, because the horses run every twenty minutes. In the stock …

The Ungnome and the Ungnomables

We're not really sure who is guarding our treasure, but it must be someone. THE FED? The Kindness of Strangers? The myth of the omniscient Fed is always on the cusp of being revealed. Yet somehow it muddles on, even when, like now, they seem to letting it all hang out. It appears this guy …

Money Flow Swings

The prominent money flow, A/D, has pulled away from the base line by a pretty fair margin and a return to that line is likely. Reason one for a reversion (to an every increasing baseline level) is that the most cyclical money flow, the MFI, registered an overbought reading and is now back down to …

QE for Duckies

The Federal Reserve refers to QE as a monetary experiment. Halcyon crys, that the Great Depression could have been avoided, through expanded use of various Fed policies really misses point. Such policies didn't exist. Rather than relying on direct spending, government promotes lending through the financial industry, to grow the economy, which in turn allows …

Money Flow Sychronocity Pt II

No matter how you parse it, the MFI is the preeminent cyclical trading indicator. In this instance we have an overbought reading (barely) and what we want to know is what happens next. The Overbought reading in November led to only a short pullback before the rally resumed, and in support of that rally we …

Limbo of the Damned Part II

2008 was a bad time for the banks. Then the rescue, and a rally of 50% in the Regional Bank ETF, then a double legged drop of 50%, and a double bottom off the GFC lows. Then Operation Twist, in 2011, Yield Curve Control and the Fed was buying longer maturities. Just to the right …

NFCI Calls the Tune….

Obviously the arrow connecting July 28th and the arrow connecting the SPY price low of Oct 7, are not the same date, but we are hunting the snark here, the recession that didn't happen, the dog which didn't bark. When WAS the recession? It went by so quickly, a couple quarters of negative GDP growth, …

Money Pumping!! Failed Rally??

The rally hasn't failed yet while hugging and occasionally breaking the bottom line of the blue channel. Two takeaways: The blue channel lines are very steep, which means hard to sustain for any period of time without some sort of pullback and the money flows are just as steep. Financial Conditions may be a bit …

Limbo of the Damned

By Medieval (Church) Reckoning, you could still go to hell, even if you didn't know hell existed which is to say in the Limbo of the Infants that you might not go to hell (if your mother took mifepristone) but you won't be able to achieve salvation either. There might be a curious contradiction in …

Money Flow Synchronocity

Perhaps the money flow for timing the market is MFI. When it goes higher off an oversold reading the market generally follows. See the area with the green stars. The A/D money flow is also generally supportive during these cycles. What is perhaps important is the time period after the MFI reaches overbought and starts …

Bullish Money Flows

The money flows are ripping right here, someone said it's 2019 again. In 2019 the Fed walked back the rate hikes and the market which had been struggling since early 2018 rallied sharply. The President derided the Fed chief for not lowering interest rates, and the Fed chief acquiesced. The market puts a lot of …

Y(m)C(a)

YC refers to Yield Curve, and this one is the chart standard, there are many many yield curves. (m)(a) refers to moving average, the context here is the depth of the separation between the 50dwa and the 200dwa.. Items of interest here are the ROC or rate of change, a very utilitarian oscillator. 1) The …

Financial (Hair) Conditioner

Yes financial conditions are getting tighter. The reason why the Fed doesn't eat their own cooking (read their own data) here is a worthwhile question. Maybe the New York guys don't trust the Chicago guys to keep the data? I don't know but I am ready to take them at their word (data) and see …

Bust or Breakout

The charts were very clear, and then like clockwork, the action reversed. When technicals don't work, that's a sign that money is pushing this market around, and we take into account the money flows. And the breakdown, in some ways looks like a breakout here. Then we have the weekly and the daily charts, which …

Slaughter of the Contrarian Bulls

The October Surprise? came on money flows lifting in tandem. The Bullish contrarians got some bad news on inflation, (Powell) said it was transitory, and they doubled down. This programmed counter response might have a name, in simple terms when the average investor reading the headlines sees something that casts a doubt on the markets …

October in April

Bit and pieces from October of 2021 Trump says Republicans won't vote in 2022, 2024 without investigation Former President Donald Trump released a statement Wednesday saying that "Republicans will not be voting in [2022] or [2024]" unless the "thoroughly and conclusively documented" presidential "election fraud of 2020" is investigated. He said abstaining from voting was "the single …

Party like you’re [in] 21

Much in the news, past tense is the "October Surprise". To recap, 2021, the market rallied, with several bull gaps (green lines) which did not close until the following spring. The last gap actually provided support. First point of comparison: the large purple arrow where the MFI was below the 50 benchmark, where it is …

Money Flows Swing

The move SINCE the bank failure crisis, solved and resolved, OBV has shown a definite upward tilt which is the main flow of money funds, and to wit, the investment banks, who have been selling this market the entire time. We broke out of the downward channel a few weeks ago, then dipped down below …

Market Psyops

Psychological Operations Psychological Operations (PSYOP) Soldiers benefit the Army's missions by using unconventional techniques. The Mission is market stability and stability means NOT lower prices, which implies, higher prices. The Fed PUT is as much a PSYOPs as a monetary policy. Analyst Jeff Snider says, the Fed is bluffing, [first foremost and always]. There is something …

Its Crazy Trump Time!

You could call it the silly season. Trump is a byproduct of the Bernanke economy, wealth disparity, and a beneficiary of the laisse faire that went with the pre-2008 global capital fire dance. Money was moving all over the place, especially China, as the Manchurian President advised the people of Taiwan to welcome reunification. Money …

Sturm and Draino : 3/23 UPDATE and Preview of the Year Ahead…

Despite the ugly last half hour, this wasn't much of a move. The Money Flows remain pretty much where they were. Price hit both sides of the ten point range today. While it seems like this was a battle of two groups, bulls and bears, optimists and pessimists, it just doesn't look that way on …

Morgan Stanley Strategist Says Bank Stress Signals Bear Market End

Market Propaganda Propaganda is the process by which media and important voices repeat what you want to hear, using various methods of rhetoric, or in this case perhaps, dog whistling past the graveyard. The context of the story above is that Mike Wilson sees the banking crisis as a means to "capitulation" in this bear …

Crash-orama

This kind of volatility in the money flows is often a turning point at the bottom, but since we aren't at a bottom something else is going on. Looking for a pattern to match this kind of A/D money flow action is the 2008 high. Albiet it's not a great fit. But all the comparisons …

Money Flows, Only More So

Money flows have bifurcated since the inception of the Not-A-Bear-Market in January 22'. There is really no reason to expect them to become "less" bifurcated. However there is the probability of a "no mas" moment. The "Always" money or A/D, has been exceptionally robust the entire length of the bear market. In the past this …

That 70’s show

Hangin' outDown the streetThe same old thingWe did last week.Not a thing to doBut talk to you Despite a lot of one offs, the flow of this market hasn't changed. Then inflation (comparisons) didn't change much either, and came in according to expectations, which is reason to celebrate, right? You know it ain't a bear …

Trend Line Obeyance

After the weekend of speculation about what would happen Monday, the futures opened lower and prices gravitated back to the lower range trend line (coral). It's sort of like nothing really happened, and maybe, nothing did. A bank closed, a few extraordinary moves by the Treasury and Federal Reserve. The A/D or always money came …

Remember when the market went up every time Jay Powell spoke?

Now the market action around the almost daily Fed briefings is anti-salubrious. (Is this a war?) One hedge fund manager went so far as to suggest that Powell just needs to shut up. [The market always goes down when he speaks.] So today they are trying to clawback some of the losses. The big picture …

There Will Be Oil

The pennant or triangle, which depends on how you want to call it. If you prefer the Lt Blue line along the bottom then you have a pennant, if you choose the purple line you have a triangle, which by definition is a bearish continuation pattern. Let's go with that. The triangle at least by …

$$ flow pattern (for informational purposes only)

After three down days in the A/D, or always money what happens? While the A/D is looking a bit topped out, the momentum is pretty strong here. The Yellow dots on the A/D plot show the top before three or more down days consecutive. The result in two of the three instances was a decent …

THE WEIGHT

From a word play on The Unbearable Lightness of Being. Things which repeat themselves, eternally, assume greater and greater weight. (A) is the dip in October which is prefigured in the current expanding money flow signal (B) . (C) is the long cup-like pullback in A/D which accompanies a drop in price. A/D has been …

What I Didn’t Do Yesterday

Reports are that ODTE options activity is soaring. This unusual because I often day trade options, and for the last two weeks I have been sitting on my hands. There was a rather righteous pattern of day session buyers taking it green, regardless of where the futures opened. Or rather if they opened up, then …

Growth of the Soil

There are plenty of steps in here worth following. The interim selloff may or may not have legs, or those legs may not be very long. Primary note of interest is the A/D line which continues higher, in defiance of the Bear Market! This means a couple things, share buybacks continue (they usually end when …

Dynamic Charting and Projections

Cut and Paste, or "signal" charting was pushed aside during the great Monetary expansion. Monetary markets tend to run in patterns. With more programmed trading it shouldn't be that hard to decipher the patterns (there are many different programs, alas...) In the current environment psychology has almost nothing to do with the pattern. After the …

Natural Gas

This chart requires a lot of subtext. The first should be inflation. If inflation works evenly then the price of natural gas should rise over time. If that were the case then 2005-2008 were times of maximum inflation, which doesn't correlate. The second moment would be 2022 which does correlate. The period from 1990 until …

Everything is great but something is rotten….

Maybe if Bill had made jokes about drugging young starlets, his humor would have been more endearing. He might have become the Donald Trump of the BLM movement. As it is he remains the tagline on Dave Chappelle's "Attention Huckstables"...... So things are really rotten, down underneath, like they always were. And stocks try to …

Everyone needs a Manifesto

The difference in money flows could not be more different. A/D is always money, it only retreats under the most dire of circumstance and then not very much. It is a cumulative record of all the economic production which has been made over a period of time. OBV is more cyclical, reflecting the willingness of …

Bull On a Rope

The money flows have broken out, and as usual there is no space to catch your breath. There was this moment today with some giveback, by the close they nailed it at 1 1/2% day, and then the afterbell earnings were all bad, Ford, Apple, Amazon..... So the money is all in, and as I …

High Beta Plains Drifter

All the attention is on the put/call ratio, while the high beta trade is starting to catch a bit of attention. A/D, or long money is favoring the long side of the S&P leveraged trade. However the intermediate trade, - OBV is showing it's strongest action in the SPY - breaking out of the year …

Fednsday

The Fed can take the easy way out. Their rate raising Hike-A-Palooza didn't tighten financial conditions at all. Now they have two choices. Double down and raise 50, or just slink off to their winter vacationing spot in the Bahamas. The FED loves this kind of moment, which is why perhaps Brainerd was taken out …

Curse of the Fed, the Money’s Curse

The Southern Engineering Company is trying to drain the local swamp for the public good. However, the efforts are being hampered by the superstitions of the workers, who believe the area to be haunted by the mummy and his bride. wikipedia It all seems familiar, "draining the swamp", or in this instance bringing down the …

22′ Flipped on it’s head

Did some work previously on the 94' charts, the 94'-95' turn was very similar to the conditions we have here. 94' was the year of the Bond Massacre, (Yields rising suddenly!) Vigilantes extracted some justice on the new monetization policies, and were ultimately unsuccessful. 94' was also the year of the Fed pivot and Greenspan …

DEBIT CEILING CRY-SIS

This is really a debit ceiling crisis, we used our card to pay for groceries but the account lacks sufficient funds, and so the bank is going to have to carry us... We are in the process of closing the last Bear gap, and this is critical. If prices fall the Gap has held and …