Category Archives: Artificial Intelligence

Silver Top … Part III

April 20, 2024 By in Artificial Intelligence, Ed Dowd, Elsa Kurt, Gold & Silver, Greg Hunter, NVDA, SLV 1 Comment

Less Volume … Less Energy

Public Service Announcement

Before we get started, recognize there’s a huge public service available with the (media, YouTubers, et al.) discussion on potential gold, silver, rally ‘to the moon’.

Now that Nvidia (NVDA) has posted a reversal, it’s likely the bull market, if not completely over, is seriously damaged.

As Ed Dowd, former BlackRock fund manager suggested, (link here), when the market turns lower, everything’s likely to head down … everything; at least, initially.

The public service: We get to see (in real time) which analysis method is best suited to determine the truth of what’s really happening.

With that, let’s move on to the chart.

Silver SLV, Tracking ETF, Weekly

If this is an initial thrust to move higher, it’s losing energy; narrow range (weekly) bar with volume contracting.

If we’re in an up-thrust about, to reverse lower or consolidate, this is the type of market behavior to expect (not advice, not a recommendation).

Delusional In … Delusional Out

Like the Artificial Intelligence (AI) delusion, hyped-up beyond all conceivable expectations, it takes a while to deflate.

This past Friday may have been the start.

So too, it could be with precious metals.

If indeed, this time is different, and were in a sustained, long term (years-long) rally for silver (SLV), then look for the character of the price action to change.

One potential example of that would be, successive gaps higher of $5/oz., $10/oz., or more.

A real bull market breakout (like the S&P in 1995), does not let you get aboard comfortably.

Note: That breakout in ’95, was a complete shock to the typical market watcher.

The S&P had oscillated in a trading range for a year before launching decidedly higher in early ’95. In that sense, the breakout is/was the complete opposite of the ‘long awaited’ (potential) bull run in precious metals.

The Mood Has Shifted

Anecdotally, the mood appears to have shifted.

If we’ve just past the top in the market (S&P, Dow, SOXX), then expect the social construct to become unhinged.

Here’s just one example of how that looks.

If you thought it was irrational on the way up … what’s it going to be like on the way down?

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.

The Danger Point®, trade mark: No. 6,505,279

The AI ‘Hot Potato’

September 14, 2023 By in $SPSIBI, Artificial Intelligence, LABD, SOXS, SOXX, SPBIO, The Maverick of Wall Street, Wyckoff 2 Comments

My Forecast Is Hotter Than Yours!

Those on the bear side of the AI insanity, know in their gut, this sector’s going to implode in spectacular fashion (not advice, not a recommendation).

The question is, as The Maverick puts it, ‘when’?

What’s also not known, is how the public is going to react when the punch bowl is taken away and we have the day of reckoning.

With that in mind, the immediate downside in the SOXX, has failed to materialize … just yet.

Therefore, all short positions via SOXS, have been closed; profit was about +10%

Behind The Scenes … Biotech

Biotech, SPBIO, has been an on-again, off-again opportunity.

It’s not known how the next ‘planned outbreak’ is going to affect the sector, but it looks like at this point, the current response is to edge lower.

Biotech SPBIO, Weekly

The big picture shows lower highs as we head toward well-established support zones.

From a trading and shorting perspective, the leveraged inverse fund for this sector is LABD (not advice, not a recommendation).

Biotech SPBIO, Daily

Moving closer in, the daily action has penetrated prior lows, technically putting the index in Wyckoff spring position.

Price action will likely attempt a move higher, happening now during this session.

If that move fails, then we have our answer; the bulls would be exhausted (for now).

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.

The Danger Point®, trade mark: No. 6,505,279

SOXX (Upside) Breakout … Fails

September 11, 2023 By in Artificial Intelligence, Positions, Semiconductors, SOXS, SOXX, Wyckoff 1 Comment

Now, It Gets Interesting

Not only has the upside at this morning’s open failed (as of 11:20 a.m., EST), we also have an ‘outside down’ (key reversal) that so far has exceeded the lows of the prior two sessions and the prior week’s low.

When A Move Fails

Failed moves get the attention of the street.

Whomever is on the other side of the trade, in this case the bulls, are potentially exhausted.

It’s still very early in the session and anything can happen.

However, the most likely outcome at this point is continued downside that may accelerate (not advice, not a recommendation).

Semiconductor SOXX, Daily

I have kept the trendline shown in the prior update intact.

What we may be looking at here, is an attempted trend breakout that has at this point, failed.

I have switched to an OHLC bar chart (instead of Candle) as the detail of the failed breakout is more clear.

The zoom area shows how price action quickly ‘gets itself back into line’ and rejoins the downtrend.

We’re now in a dangerous spot for both sides as price action is currently in Wyckoff spring position, having penetrated prior lows.

Probabilities point to more downside; let’s see what happens next.

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.

The Danger Point®, trade mark: No. 6,505,279

Has AI, Started To Crack?

September 9, 2023 By in Artificial Intelligence, Livermore, Positions, SOXS, SOXX

Quiet, At The Beginning

For those who may be new to the reversal, the SOXX, top was posted here; the pivot to the current downside identified here.

Probabilities point to more downside, but if AI, and specifically, the SOXX, manages to move higher from this point, the above two links at the minimum, highlighted tradeable pivot points (not advice, not a recommendation).

Go Big or Go Home

Way back, from Jesse Livermore’s book Reminiscences, he talks about establishing large (low risk) positions early, before a move has really had time to accelerate.

As price action gets farther away from the entry, risk increases (not advice, not a recommendation).

Positioning

This site seeks to emulate the strategies and techniques used by three masters, highlighted in the About section.

With that in mind, the chart shows how one trader has positioned in the leveraged inverse fund SOXS (not advice, not a recommendation).

It’s the ninth trading series for SOXS, this year, hence the identifier.

The first number column is the entry price, the second, the initial stop and then trailing stop.

Last column is the current close price.

Notes from the previous post on the trading channel remain unchanged. The SOXX is trending down, until it decides otherwise.

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.

The Danger Point®, trade mark: No. 6,505,279

Trending … Under The Radar

September 8, 2023 By in Artificial Intelligence, Positions, SOXS, SOXX 2 Comments

‘Distribution’, On The Way Down

How long before talk of AI disappears completely from the media?

How long before everyone figures out there’s a new hand being dealt and no ‘dip’, in AI?

It’s possible we could be there now, but it’s not likely (not advice, not a recommendation).

The Media Minions

If you happen to sense something’s wrong and actually take your profits, you’re treated with disdain, link here.

Wow, just wow.

Next up, if you can actually think and suspect something’s wrong with the forecasts, then you’re a ‘Conspiracy Theorist’.

Another wow.

Just look at the picture in the link … notice anything wrong?

So, let’s leave the big-top clown-show and see what price action’s telling us.

Semiconductors SOXX, Daily

It’s early in the session (11:25 a.m., EST); this is how it looks.

As said, it’s early and anything can happen.

The market could suddenly decide to fill the gap, or that gap could be a ‘breakaway gap’, signaling probability for a persistent down move.

Positioning

Gap fill or not, I remain short this sector via SOXS, with Hard Stop,moved to SOXS 9.37 (not advice, not a recommendation).

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.

The Danger Point®, trade mark: No. 6,505,279

Positioned At The Extremes

September 2, 2023 By in 1929, 1987, Artificial Intelligence, Mass Psychosis, Natural Gas, Positions, Semiconductors, SOXS, SOXX, UNG

‘Evidence Of A Struggle’

To minimize risk, you need to position at the psychological extreme.

That’s not necessarily the top or bottom of a move, but it could be.

At Opposite Ends

From a trading standpoint, this past week saw a lot of activity.

Trades entered, exited, some re-entered, some, not.

The net result was two positions in separate, non-correlated markets.

One was shorting the SOXX, via SOXS, the other, adding to longs in Natural Gas via UNG (not advice, not a recommendation).

Fake, Fraud & Thought Shaping

By far the main hysteria is in AI, and its cohort, the semiconductors, SOXX.

From my first trade way back in the spring of ’87, to now, I’ve never seen a mass psychosis mania, fueled by propaganda, lies and made-up numbers, like this.

One can only guess where or when the shoe will drop that starts the whole (mind-shaping) scheme unraveling.

Evidence Of A Struggle

When price action pushes above or below established resistance or support, it’s at The Danger Point®

When that happens, depending on the action itself, the risk of being wrong (on an opposing position) is lowest.

The SOXX may be there now.

Semiconductor SOXX, Hourly Chart

It’s clear, a battle’s going on between bulls and bears at resistance (blue line).

Just before, during, or just after a holiday week tend to be pivot points in the market.

Said many times on this site, the most famous of these was September 3rd, 1929, the Tuesday following the Labor Day Weekend.

That was the all-time high, just before the crash.

Positioning

There are two positions open, each with a tight stop (not advice, not a recommendation)

Long UNG; Hard Stop @ 6.93

Long SOXS (short SOXX): Hard Stop @ 8.97

Now, we wait.

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.

The Danger Point®, trade mark: No. 6,505,279

The End For AI?

September 1, 2023 By in Artificial Intelligence, INTC, Positions, SOXS, SOXX

Failing Breakout & Fibonacci

Could AI, become a Dog?

That’s not saying AI, ‘identifies’ as a dog, but AI becomes a market dog, a massive underperformer.

You know, like Intel 🙂

Yesterday’s update said to be on the lookout for a reversal.

The SOXX, was struggling to move above resistance and if it failed, we’re likely to head lower from here (not advice, not a recommendation).

At this juncture (11:40 a.m., EST) the SOXX, posted a new daily high but is currently trading below yesterday’s close.

Semiconductor SOXX, Daily

The chart shows the struggle to get above the resistance area (blue line).

The chart also shows we’re at a Fibonacci 89 Days, from the low set on April 27th, to now.

Positioning

The initial position from yesterday was exited in the pre-market as SOXS touched the 9.05, Stop Level.

After the open, it was obvious we may have hit the SOXS lows (at 8.97) and are now going to move higher.

Re-entered at SOXS 9.19, with Hard Stop at session lows of SOXS 8.97 (not advice, not a recommendation).

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.

The Danger Point®, trade mark: No. 6,505,279

From ‘Hype’ to ‘Opportunity’

August 31, 2023 By in Artificial Intelligence, Positions, Semiconductors, SOXS, SOXX, Wyckoff 1 Comment

What A Difference A Day Makes

Update: 9:50 a.m., EST

Exited SOXS @ Stop 9.05, then re-entered after the open at 9.19.

Hard Stop @ Session Low 8.97 (not advice, not a recommendation)

SOXX, price action pushed above well-established resistance and so far, has failed to hold.

After hours has the SOXX, trading down -2.45-pts. (as of 7:30 p.m., EST) which gives us a hint there may be a new daily low at the next session.

If so, it’s a Wyckoff Up-Thrust, a reversal, with significant potential for downside.

Positioning

Already short this sector via SOXS with hard stop at the session low of SOXS 9.05 (not advice, not a recommendation).

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.

The Danger Point®, trade mark: No. 6,505,279

The ‘Bag Holders’

August 25, 2023 By in Artificial Intelligence, Natural Gas, Positions, SOXX, UNG 1 Comment

‘We Need A New Story’

The mainstream has run out of hype; at least for now.

Their AI mania narrative and price action blew up yesterday.

The probability for a blow-up was identified ahead of time, here.

Who knows how many retail investors bought in, now, left holding the bag.

The more probable (overall market) outcome at this point, is sustained, persistent, downside … possibly for years if not decades (not advice, not a recommendation).

However, not every market is going to go straight down. Some, might actually go higher.

Natural Gas & The ‘Disruption’ Trade

One of those upside probabilities highlighted in this update was Nat-Gas.

From that update we have:

“If UNG, heads lower yet again, it could be the last straw for the weak bulls, causing them to close out.”

Nine trading days later, that’s exactly what happened.

The original chart of UNG, has been updated to show subsequent price action.

Natural Gas UNG, Daily

When price action penetrated support (lower blue line), it puts UNG at The Danger Point®

This is where the risk of being wrong for a long position is least (not advice, not a recommendation).

Positioning

Taking the above into account, with downside risk potentially minimized, two entries were made during this session (currently, 1:21 p.m., EST).

One at UNG 6.64, and another larger entry at UNG 6.75.

An obvious Hard Stop is yesterday’s low of UNG 6.49, with a Soft Stop (trader discretion) at today’s low of UNG 6.63 (not advice, not a recommendation).

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.

The Danger Point®, trade mark: No. 6,505,279

SOXX, Hits Downside Target

August 19, 2023 By in Artificial Intelligence, Livermore, NVDA, Prechter, Semiconductors, South Sea Bubble, SOXS, SOXX

First of Many?

At this point, market bulls have to be just a little bit nervous.

Is the reversal from Friday, going to hold into next week or was it just a blip on the way to much lower levels?

Can a ‘Once in 300-years mania’, affect us here and now. Is that knowledge useful for day-to-day decisions?

One way to answer is to place that fact in the ‘fundamentals’ category; knowing it’s there but stay absolutely focused on the immediate truth, that is, ‘price action’.

The SOXX, So Far

We can see the SOXX reversed as identified here.

Then it continued lower, formed a trend line, shown here (using inverse SOXS).

Fast forward to now.

The weekly chart (below) shows price action contacted the first Fibonacci projection ‘exactly’ and rebounded.

That ‘rebound’ was Friday’s reversal bar.

Semiconductor SOXX, Weekly Candle

We’re at a critical juncture.

Livermore said years ago, ‘surprises tend to come in the direction of trend’.

With that, Google may have just released the first of many AI, and specifically NVDA, market surprises.

That report is the for the mainstream and even it admits, ‘There was a lot of hype’.

When hype is exposed, the market typically exacts its own form of revenge.

That revenge usually falls on the ‘little guy’ who’s left holding the bag, unable to fathom, ‘the experts’ were only in it for the money.

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.

The Danger Point®, trade mark: No. 6,505,279