Category Archives: Prechter

A.I. ‘Dominoes’, Start To Fall

February 24, 2025 By in Artificial Intelligence, David Weis, Livermore, Loeb, Positions, Prechter, Semiconductors, South Sea Bubble, SOXS, SOXS-25-08, SOXX, Wyckoff

Data-Center (lease) Cancellations

One of many to come?

The article at this link says the cancellation move was ‘unexpected’.

Clicking on ‘Artificial Intelligence’, (side-bar) and going back to August of ’23, with this post, then reading though subsequent posts, one can say the ‘cancellation’ was fully expected.

That August ’23, post has the link to Prechter’s analysis; we’re in the largest asset bubble in at least 300 years (not advice, not a recommendation).

All of that brings us to chief cook and bottle washer, Nvidia.

Nvidia NVDA, Daily

We’ll cut straight to the chase (as of 11:35 a.m., EST).

A Fibonacci projection is overlaid starting from the all-time-high (1/7/25), to the recent lows (2/3/25), back up to test (2/18/25), then reversal, again.

Note how last Friday’s price action printed and closed near the 23.6, Fibonacci projection.

Positioning

Everyone has their own preference and style.

As stated in the ‘About‘ section, this site works to emulate behaviors of the three masters listed.

That, in addition to the once-in-a-lifetime opportunity to have been mentored by the late David Weis, results in what’s available on this site.

With that said, positioning in the SOXX (the A.I. proxy) is short, via SOXS, as SOXS-25-08, initial entry link here (not advice, not a recommendation).

Note: SOXS-25-08, stop to be moved to the day’s session low; currently 18.58 (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 SOXX, Has Spoken

November 11, 2024 By in Artificial Intelligence, Great Depression 2.0, Livermore, Prechter, Semiconductors, South Sea Bubble, SOXS, SOXS-24-20, SOXX

Anyone Listening?

For the vast majority, the answer is, ‘probably not’.

For the tiny fraction monitoring these updates, we should be getting the uneasy feeling, the (major) pivot downward in the SOXX, may have just started (not advice, not a recommendation).

Painstaking Detail

Over the past several months, presented on this site, the assessment that A.I., ‘artificial intelligence’, is just another mania in a long line of manias, going way back to the South Sea Bubble of the 1700s; reference posts or links here, here, and here.

The trick is, and has been, what to do?

One Man’s Approach

If I had to summarize my approach to the current situation, it would be to model Mr. Partridge (a.k.a. ‘Turkey’) from the book, Reminiscences of a Stock Operator.

That is, get into position, minimize transactions, stay there until the market says otherwise (not advice, not a recommendation).

That’s what’s being done; trade labeled: SOXS-24-20.

For additional reference, click on that number in the sidebar to see all related posts.

Election Reaction Complete

Based on SOXX, price action itself, it’s possible the upward blip from last Tuesday’s events has run its course.

If that’s true, we can get back to the (potential) implosion of the sector (not advice, not a recommendation).

As of this post (11:41 a.m., EST) the SOXX, has retraced nearly every bit of last week’s up-move.

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

Bonds … The October Surprise

October 6, 2024 By in Bonds, Dollar, DRV, DRV-24-05, Federal Reserve, Interest Rates, IYR, Prechter, Real Estate, TLT, Usual Suspects, UUP, ZeroHedge Tags: , , , ,

Will The ‘Wedge’, Close The ‘Spead’

Bonds traded down hard last Friday.

With the reversal now obvious (since the Fed announcement, September 18th), we have the usual suspects putting out ‘content’ (here and here) letting you know what’s already happened.

In Prechter’s book, The Wave Principle of Human Social Behavior, he states, being part of the herd, is hard-wired into the brain.

Therefore, it takes diligent, consistent effort, to go against the mindless (limbic brain) herd if you’re going to make an objective observation.

So, let’s do just that, taking an objective look at the potential effects of the bond reversal.

Bonds (TLT proxy) began its reversal, rates higher, the day before the last Fed announcement.

The IYR, reached its high that Wednesday, 9/18/24.

Real Estate IYR, Weekly

It’s been nearly three years since the all-time high in December, of 2021. The wedge shown below has been just over a year in the making.

The reversal action of the past few weeks can be seen in the ‘Throw-Over’ area of the chart.

If the wedge has been identified correctly, price action has now entered back into that formation.

Positioning

This post highlighted a short position was on the horizon.

This post confirmed.

This post connected the dots with the bond market.

That same post presented a tentative stop above break even on DRV-24-05 (not advice, not a recommendation).

Trend or Not

We may know as early as tomorrow’s session (Monday), if IYR has established and confirmed a downtrend.

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

Chaos & Order

September 10, 2024 By in Artificial Intelligence, Federal Reserve, Prechter, Semiconductors, SOXS, SOXS-24-15, SOXX

Rule of Alternation

The SOXX reversal from the July 11th high, to the Monday morning August 5th (panic) low, was chaos.

Wide price gaps, huge intra-day percentage swings.

Then, there was a rebound to the August 22, high when the next (potential) leg down started.

Note the difference in SOXX behavior thus far; a steady decline that’s orderly.

Semiconductors SOXX, Daily

So far, the SOXX is continuing its next leg lower in an orderly fashion.

There’s no telling on how long this will last.

Possibly, after the Fed announcement next week, one could expect a ‘change of character’ (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 SOXX Drop

September 5, 2024 By in Artificial Intelligence, Prechter, Semiconductors, SOXS, SOXS-24-15, SOXX 1 Comment

Hardest Part … Waiting

Back in the day, Robert Prechter Jr., said it himself (paraphrasing):

‘You can reap a windfall, just by monitoring a trendline’

Of course, the hard part is identifying the trendline … if there even is one.

Implied with that, already being in position to take advantage of that trendline.

Building The Trade

Positioning short in the SOXX (via SOXS) has been a process of iteration; from SOXS-24-12, until now, SOXS-24-15 (not advice, not a recommendation).

All of those trades have been documented on this site.

Note: Enter the trade number (or, copy-paste) into the search window and then click on the sidebar to get chronology of all posts related to that trade.

With the SOXX, opening down, yet again, one has to ask; is there a trendline and if so, where is it?

Semiconductors, SOXX, Daily Close

I’m taking artistic license to draw where I perceive is the current right-side trendline.

Also note, this update is being released with about 90-minutes left in the session.

The closing price is yet unknown.

Going forward, price action itself will either confirm or negate the right side.

Positioning

As shown on the chart, the current (active) short trade, via SOXS, was opened last Friday at the ‘False Breakout’ (not advice, not a recommendation).

With price action continuing lower, it would be nice for this position to become a boring series of actions; moving the stop until the trend break and/or exit.

All the while, keep in mind, we don’t know what our ‘October Surprise’ is going to be … yet.

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

September 3rd, 1929

September 3, 2024 By in 1929, Artificial Intelligence, Great Depression, Great Depression 2.0, Holiday Turns, NVDA, Prechter, Semiconductors, South Sea Bubble, SOXS, SOXS-24-15, SOXX

Top of The Market

Market Crash, 1929

Market reversals tend to occur just before, during, or just after a holiday week.

Is that where we are now?

Semiconductors (SOXX), and it’s chief cook and bottle washer, Artificial Intelligence (NVDA), may have already decided the next direction … down.

Semiconductors, SOXX, Daily

It’s just after the open and this is where we are.

“What do you see?”

Marking up the chart, we have a sell-short indicator (not advice, not a recommendation) right along with a hard stop location (as shown).

From yesterday’s update, those that watched the presentation by Robert Prechter Jr., were challenged with the idea, we’re in the largest bubble ever or at least since the 1720s South Sea Bubble (not advice, not a recommendation).

Positioning

In the sidebar, we can already see a short position was opened during last Friday’s session: SOXS-24-15 (not advice, not a recommendation).

Everyone has their own style and for me, I detest ‘chasing’ the market.

I’d rather make several attempts, get stopped out, then enter again, than watch the opportunity take off because I was too afraid to pull the trigger.

It’s only 20-minutes after the open and we can see the SOXX, is down hard.

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

Silver Surprise Continues … Down

September 2, 2024 By in Gold & Silver, Prechter, Semiconductors, SLV, SOXX 1 Comment

It’s An Industrial (economic) Metal

Things just aren’t working out for the silver bulls.

The metal is down yet another 1% in today’s session.

Not only that as we’ll see below, but we could also be in a downward trading channel as well.

Talk about a ‘hyperinflation breakout’ has all but disappeared and we’re back to the (very lame, by now) excuse that it’s all because of those evil ‘manipulators’.

Leaving delusion behind, back to reality, price action itself, this site’s been consistent for over five months.

That is, silver’s exhibiting characteristics of a downside reversal or sideways congestion (not advice, not a recommendation).

Silver SLV, Daily

From the chart above, we can see the right-side being confirmed over the past four or five sessions (black arrow contact points).

Also noted, there’s a Fibonacci time correlation between the intermediate high on July 11th and the right-side channel line contact on August 27th.

July 11th, was also the SOXX top.

About two decades ago, Prechter first proposed, ‘It’s all the same market’; meaning, that it’s the liquidity in the system that’s moving prices.

As that ‘liquidity’ dries up with more demand for cash (fiat, or not), the expectation is for the market indices to respond to that demand (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 ‘Secret’ Lies With Bonds

August 25, 2024 By in Bonds, Federal Reserve, Interest Rates, Prechter, TLT, Wyckoff, ZeroHedge 1 Comment

What Happens, When It Doesn’t Happen?

‘The truth has no defense against the man determined to believe a lie.’

Unknown

It’s been proven many times on this site and by others more notable (i.e. Prechter), the Fed is not a leader.

They are followers; essentially reacting (not responding) to what the bond market is telling them.

Done Deal? … Not Yet

The financial press acts like a rate cut is a done deal.

However, when looking at the chart (i.e., the real leader), long bond proxy TLT, it makes perfect sense the Fed would propose a cut at the September 17 – 18, meeting.

It’s what happens between now and then, that’s important.

For clues as to what that ‘then’ could be, we go to the bond market itself.

Long Bond Proxy, TLT, Daily

“What do you see?”

There’s a lot going on in this chart; the mark-up (below) is divided into two.

First, is the targeted measured move (that’s been met) out of the wedge formation (not advice, not a recommendation).

Next, we’re also in a Wyckoff Up-Thrust condition which may have been tested on declining volume, this past week (not advice, not a recommendation).

At this juncture, it’s not unreasonable to say bonds (TLT) are at The Danger Point®

It would appear, the weight of a feather could move prices either way.

The interesting part will be what comes next; Sunday overnight Futures open, is about nine-hours away …

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

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

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 Moderna Reversal

June 19, 2024 By in $SPSIBI, Biotech, Dr. John Campbell, Elliott Wave, IBB, Livermore, Loeb, MRNA, PFE, Prechter, SPBIO, Wyckoff, XBI, ZeroHedge 1 Comment

When Price Action Heads South …

Said many times;

‘When price action heads south, bad news comes out.’

That’s a slightly different take on Prechter’s (Elliott Wave) observation.

‘Price action leads the news; not the other way around’.

Going to BigCharts, typing in MRNA, shows they still have no P/E.

So, the ‘bad news’, can’t be they’re not making any money because they’re not doing it, now. 🙂

I wonder, who can it be now?

For a clue to the (potential) answer, we can look at what’s happening to Pfizer, link here and here.

However, let’s not get ourselves wrapped around the axle on events, forecast years ago.

Rather, let’s go straight to the truth, the price action and see what it’s telling us.

Moderna MRNA, Weekly

The entire move from low to highs is shown. Included on the chart, are two Fibonacci indicators.

One is the standard ‘retrace’ indicator; the other, is a ‘projection’ indicator.

The ‘projection’ is based off the ‘a-b-c’ move from the lows of November 2nd, 2023, to the highs on May 24, 2024.

The retrace and projections are hard to see, so the ‘Detail‘, arrow is where we’re headed next on the daily.

Moderna MRNA, Daily

If there ever was a chart to once-and-for-all, refute, dismiss, trash, the whole ‘Fundamentals’ argument, that earnings, interest rates or some other ‘Voodoo economics’, moves prices, this is it:

MRNA, price action hit the 23.6% retrace level (exactly) for two days before moving on to hit the 161.8%, projection (exactly) before reversing.

Note the ‘100%‘ level as well; price action confirmed this area (exactly) three times! Once on the way up and two times on the way down (third time, not shown).

A century ago, Livermore said, ‘It’s all about the numbers’.

Strategy, First

Just as Livermore was primary a strategist, so is this site’s method of analyzing the markets, i.e., Strategy, Tactics, Focus, in that order (not advice, not a recommendation).

The news has been replete with reports like this one and this one.

Another panic ahead?

Sounds like it but at least in the case of Moderna, the chart itself says (effectively):

‘There’s no money in it’.

That means, another wave like we saw several years ago, is not the most likely future event (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