Never More Fragile, as Now

Stretched, Stretched, Stretched

Slightest Dip, Cascading Effect

The last update had what some might consider a hyperbolic statement:

” … a market break anywhere from 20% to 50% (in our view) can happen at any moment.”

Less than an hour after that post, we had this from ZeroHedge.

” …in other words, stocks may be at a record high, but they have also never been more fragile and more sensitive to even a modest drop.”

Of course, nobody’s going to come out and publicly say we could get a ‘disconnect’ that results in a 20% drop or more, overnight.

Remember the Flash Crash of 2010?

In the entire history of the market, that’s never happened before, either.

Biotech Backdrop:

We’ve got empirical and anecdotal evidence pointing to the real objective of the ‘experiment’; now, we’re fortunate enough to have a data analyst doing what the medical establishment used to do.

That is, maintain and present the data.

The analyst at this link, is parsing the government database of adverse reactions. That analysis can be viewed here.

Reviewing the data solidifies the fundamental case even more for biotech implosion (taking down the broad market as well).

Mr. Benavidez estimates: 100,000 – 200,000 already dead in the U.S.

Let’s not forget; nearly half of the states have approved ‘liquefaction‘ of the deceased to be used as ‘fertilizer’. These are facts.

Seems like everything’s well planned … far in advance of current events.

Biotech Technical:

Since the SPBIO, index does not provide volume data, we’ve done a modification.

The SPBIO, weekly chart is below but it’s inverted. The weekly Force Index of leveraged inverse fund LABD, has been added.

On a closing basis, SPBIO (inverted) has penetrated just below support. It’s done so on significantly divergent energy.

Drilling down to the daily, it’s a similar picture; except we see the axis line (now support) more clearly.

Summary:

With the conditions noted above, SPBIO’s in position to pivot. Heading lower while LABD moves higher.

Potential USO Model:

When the big reversal takes hold, conditions may be similar to oil (USO) from July 2014, to the interim bottom of February, 2016.

During that move, the market retraced no more than 23.6%, at any stage of the decline.

However, if you recall, newsletter writers, pundits and YouTubers were putting out their prognostications; get into oil’s ‘big rebound’.

By February 2016, USO’s down a whopping – 81%. The oil market never came back.

Final Notes:

One commenter to a Jerimiah Babe video observed:

‘Most people think the worst is over when it’s not even started.’

That exemplifies the mindset required. This economic and societal decline is going to be a very long ordeal.

The normal at this point, is anything that wasn’t normal before.

Stay Tuned

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

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