With a short-entry signal that’s straight out of David Weis’ training video (recorded in 2007), Alcoa breaks down in dramatic fashion (not advice, not a recommendation).
As of this post, 11:34 a.m., EST, Alcoa has gap-opened lower, currently down, -5.10%.
Alcoa AA, Daily
Prior short, AA-26-03, was exited last Friday with profit.
That action proved to be correct. The next session (yesterday), was a rally into a test.
Today, was a gap-lower open.
There’s a potential for a sustained move. Short, AA-26-04, opened with a stop located at yesterday’s high (not advice, not a recommendation).
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.
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.
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.
Yesterday, biotech had moving average compression; today, it’s Alcoa.
In this case, we’ll present the monthly chart, showing the long-term picture.
As we’ll see, moving average compression is rare, especially when using the longer time-frames.
In the case of Alcoa (AA), you have to go all the way back to 1978, to find a similar event.
The Big Bubble
Referring to Prechter’s analysis link here, he states that we’re [potentially], in the largest asset bubble since the South Sea, over 300-years ago.
Let’s keep that in mind. Events are happening on such a massive scale; the typical observer may not be aware of the significance and/or the rarity.
Alcoa AA, Monthly
The zoom areas are side-by-side to show the similarity.
Expanding the chart and including the wedge notation, also shows price action at the lower boundary.
It should be noted, AA, is part of the ‘Basic Materials’ sector, with tracking ETF as IYM.
Included in the IYM components, is NEM, and RGLD; this sector is correlated with the miners, GDX, GDXJ.
Positioning
It’s the trader’s discretion as what to do at this point.
This site may or may not execute a direct short of Alcoa, just as it might do with Carvana (CVNA), and maybe others (not advice, not a recommendation).
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.
As a reminder, the economic (and population) collapse created by protection from ‘The Speck’, will last the lifetime of anyone reading this post (not advice, not a recommendation).
To support that statement and expand on the enormity of what’s happening, we have this link.
‘Over the next 10 years, ‘Speck’ lawsuits are projected to experience tremendous growth.’
With that, let’s move on.
Alcoa & ESG
Just looking at the website, it’s an ESG cornucopia.
When looking at the chart, it’s (almost) a no-brainer.
First, the very long-term view (Quarterly)
Alcoa AA, Quarterly
On the long-term, we have the repeating market characteristic; ‘Spring-to-Up-Thrust.
A ‘test’ of that up-thrust has been occurring over the most recent quarter.
On the weekly chart, we see price action penetrated support with volume increasing.
Alcoa AA, Weekly
Technically, it’s a Wyckoff ‘Spring’ set-up. Some form of upward action next week is to be expected.
However, with the increased volume to the downside, probabilities are low at this point we’ll see any significant upside (not advice, not a recommendation).
Long Way To The ‘Open’
As said in the prior update, events are accelerating. The latest from ZeroHedge proves that to be true.
UBS Seeks Government Backstop As It Rushes To Finalize Credit Suisse Takeover Deal As Soon As Tonight
Another Nail in the Coffin
Looks like the Swedes have put another nail in the coffin for ESG. How long is it going to take for their pension system to fully collapse and then result in social unrest a la Paris?
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.
‘Spring-to-Up thrust’ is a common price action phenomenon.
Credit goes to the late David Weis for noting this behavior in one of his daily market updates from years past.
Now, we see it in action with SOXX.
As with airlines, semiconductors are highly susceptible to economic changes. Both operate on thin margins and have high capital costs.
Airlines (at least UAL and AA) have never recovered to new all-time highs. Maybe the semis went higher because of all the contract tracing that’s being projected.
However, noted in yesterday’s update, there’s a chance there won’t be much to ‘trace’; we’ll find out very soon.
SOXX is at the danger point; risk of a short position (not advice not a recommendation) is at minimum.
As an extra reminder, we’ll add a frequently discussed theme for market tops: ‘Holiday Turns‘
Emperical data shows that markets tend to reverse before, during, or just after a holiday week.
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.
The Danger Point® 