Category Archives: Artificial Intelligence

A Tale Of Two Tops … Nvidia

June 22, 2024 By in Artificial Intelligence, NVDA, Prechter, Semiconductors, SOXS, SOXS-24-09, SOXX

The Rule of ‘Alternation’

It’s not hyperbolic to say, what’s happening to Nvidia right now, has never happened before.

As we’ll see on the chart, the market itself proves that point.

Work has already been done (here, here, here and here) on why Nvidia, may be at a significant inflection point (not advice, not a recommendation).

Now the smoke has cleared from Friday’s session, we can look at what happened and what’s likely to happen.

First, we’ll use a Fibonacci 8-Day, chart.

Why? Because nobody else uses one. 🙂

Besides being a Fibonacci number (just like the Weekly, at 5-Day), the 8-Day, seems to show the potential better (at this point) than other timeframes.

Nvidia NVDA, 8-Day

Let’s go all the way back to the beginning and why the current situation is unique.

NVDA, started trading the week of January 22nd, 1999.

During that span, there are no two Force Indicator occurrences (shown below) at this level of energy.

In fact, there are no Force Index prints at this level, ever.

The only print that comes close is also shown on the chart, occurring in late May, of ’23.

An astute observer can instantly see the trouble or potential trouble.

During the consolidation period from mid-March to late April, Force Index declined and eventually posted negative.

That temporary wash-out provided fuel for more upside.

Now, price is rising with force declining, at the same time.

The inference, the rally is weak if not extremely weak.

Let’s not forget, the ‘old-timers’ say it’s the biggest bubble they’ve ever seen.

Couple that with NVDA, having already launched from bottom to top, 1999 – to- Latest Highs, a massive 469,000%.

Time permitting, in the next update, we’ll look at the potential for an ‘Island Gap Reversal’, in the SOXX.

Stay Tuned

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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

Nvidia Split Top … Part II

June 21, 2024 By in $SPSIBI, Artificial Intelligence, Biotech, LABD, LABD-24-12, NVDA, Semiconductors, SOXS, SOXS-24-09, SOXX, SPBIO, XBI 2 Comments

Reversal On ‘Week 89’ ?

The tape is saying ‘This could be it’.

No one knows if this is ‘The top’, or just ‘A top’, until it’s all over (not advice, not a recommendation).

This update for Nvidia, said we’re nearing Fibonacci Week 89 (from the October ’22, lows); look for evidence of a reversal.

With three-hours left in the session, NVDA is on track (along with the SOXX) to posting a weekly reversal bar.

Nvidia NVDA, Weekly

The chart updated to show we’re at ‘Week 89’.

The fact (minus 3-hours) we’re getting a reversal bar on ‘Week 89’, is potential validation of the Fibonacci count.

The market itself is telling us where to look.

With the prior update letting us know the air is going out of support for continued A.I., today’s action may be a significant reversal (not advice, not a recommendation).

Update: 2:07 p.m., EST

Housekeeping Note:

While under no obligation to discuss trades, nonetheless, for those following the biotech short (LABD-24-12), that trade has been exited (for now) with profit (not advice, not a recommendation).

Stay Tuned

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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 A.I. Money’s Down The Drain

June 20, 2024 By in Artificial Intelligence, Biotech, Semiconductors, SOXX, Wyckoff, Wyckoff Stock Market Institute 2 Comments

The Plug, Has Been Pulled

Markets reverse in a typical way; first is ‘sentiment’, then ‘volume’, then ‘price’.

According to this link, looks like we have sentiment aplenty; evaporating sentiment, that is.

As stated by Mr. Fred Hickey, VC (Venture Capital) funding peaked last year and has dropped over 75%, since then; that’s the ‘sentiment’ part of the equation.

A partial synopsis of his interview, in the link above:

Time Stamp:

9:15, The greatest bubble I’ve ever seen

11:15, It’s all happened before

11:40, Narrowing market

11:55, Volume decline

16:30, Honeymoon phase is over

17:50, VC spending down 75%

18:05, Everyone knows it’s a joke (except, Wall St.)

And on it goes …

Where’s The Top?

From a Wyckoff perspective, using his analysis (here and here) as a basis of speculation, that’s the wrong question (not advice, not a recommendation).

If we’re expecting some kind of massive reversal (which we are), then the objective is to look for the weakest sectors, not the strongest.

Frequent users of this site already know that work’s been done. One of, if not the weakest sector(s), is Biotech (not advice, not a recommendation).

Is Today, The Day?

With that said, as this post is being created (1:20 p.m., EST), the sector at the center of bubble attention, the SOXX, may have just completed a wedge ‘throw-over’.

Semiconductors SOXX (ETF), Daily

Any number of scenarios can be in play.

At this point, the SOXX, may be in the process of validating the terminating wedge (not advice, not a recommendation).

As Fred Hickey said, it’s the biggest bubble he’s ever seen.

By the time it becomes obvious, it’s way too late for (low-risk) positioning.

Stay Tuned

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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 Usual Suspects

June 16, 2024 By in Artificial Intelligence, Federal Reserve, Food Supply, Genesis 41, Interest Rates, James Grant, The Speck, Usual Suspects, Wyckoff, ZeroHedge 1 Comment

Can It Get Any More Stupid?

It’s been a while since rounding up The Usual Suspects.

However, like last time, the stupidity, misdirection, misinformation, outright falsehoods, overall grift and schtick, has got to the point where an update is needed.

We’ll start off by repeating No. 1 from the prior ‘suspects’ as it encompasses the whole genre of ‘non-thought’ by the public and financial press alike; readers of this post excepted, of course. 🙂

No 1. There (still) is no Fed Pivot. Seriously, have rates really, actually been lowered? Everyone has a huge case of ‘normalcy bias’. i.e., what the Fed did last time will happen this time.

The 40-year bond bull market from the ’80s, ended in 2020. We’re in a different paradigm now.

We’ll add in this updated post, James Grant, of Grant’s Interest Rate Observer.

He second’s the motion: The 40-year bond bull market, is over. Period.

No 2. It has always been about the food supply.

Food is boring and gets no ‘clicks’ on my grifting ‘silver, gold stacking’ website or YouTube, so I ignore it.

After all, my business, is to get more business.

Just a reminder, if anyone really wants (inedible) gold or silver (cheap), this might be a way to get it.

No 3. The market has ‘thinned out’ to an incredible degree.

Now, instead of The Mag 7, there are only three and one of them, is a washed-up gaming stock.

How apropos, when considering the opening paragraphs about the overall public and financial press.

No 4. Is Artificial Intelligence just another lie?

Looks like according to this, it can’t be trusted. Who could have guessed?

I’m shocked! Shocked!

No 5. Ruh-Roh Scooby, fake meat’s bad for your health.

Didn’t see that one coming.

No 6. Well, there could be a new ‘scarient‘ in the works.

However, looking at price action of the biotech sector, far below its all-time highs, the market itself, is saying ‘No, not this time.’

No 7. Could the S&P make it to 6,300?

After all, it’s all about the numbers, right?

The S&P bottomed at 666.67 on 3/9/09.

Summary

If there ever was a time as Wyckoff said, to ‘completely ignore the financial press’, this may be that time.

He also stated, ‘reading price action is hard, taking literally decades and many losses to master’, a skill which is never really complete.

As the ‘About‘ section states, this site is one leader’s perspective on that action; presenting it, in a strategically cognizant form.

As far as is known, no other site is doing the same.

Stay Tuned

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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 Nvidia (Split) Top

June 8, 2024 By in 1987, 1998, 2000 - 2001, 2007 - 2008, Artificial Intelligence, Federal Reserve, NVDA, SOXX 3 Comments

Top of The Tops?

Here … ‘Hold this bag’.

Having been through the crash of ’87, ’98, ’01, ’08, and now, the feeling is similar.

Each time the vehicle (stock) is different but also the same, at the same time.

In case anyone wants to review, here’s the definition of ‘bag holder‘.

Is Now, The Time?

Previous analysis and potential top identification for NVDA, has been premature.

With that in mind, presented below are two charts.

One has the Fibonacci count from the October ’22 lows; the other, shows a trading channel overlay.

The inference is, we’re close to some kind of ‘event’ whether it be sideways congestion or reversal (not advice, not a recommendation).

Nvidia NVDA, Weekly

It appears, since the October ’22 lows, NVDA is being influenced by a Fibonacci sequence.

The ”close’ chart has the same Fibonacci count as well as the current trading channel.

Next week is ‘Week 88’, stock-split (10 to 1), as well as the Fed meeting.

Week 88, is within the margin of error for a precise Fibonacci count, Week 89.

With NVDA, at the top of its trading range, one needs to be on the lookout for some type of Fed/Stock-Split ‘overshoot’ or other indicator of potential upside limit (not advice, not a recommendation).

Stay Tuned

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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

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

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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

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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

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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

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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

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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