Position Change

DRV pushed through our stop early in the session; position closed (not advice, not a recommendation).

1:50 p.m. EST:

Despite all the analysis, IYR is showing continued buoyancy.

Something else is going on; possibly related to Uneducated Economist’s link provided in the last update.

Taking his cue, a functioning mortgage market is all important to the financial narrative, it’s possible this market will be more heavily manipulated than others.

At this juncture it would make sense. All indications are for reversal … yet it’s not happening in any significant way.

Time for another trade.

We’re going back to a market that in retrospect, should’ve been the focus all along; Biotech.

This site’s coming from the perspective those reading, are well aware the ‘speck’ as we call it (to avoid censorship) was a fabricated event.

Just a reminder that we’re not some ‘Johnny come lately’, here’s the link from way back in May, last year.

That post proves the situation was figured out well before the May 17th publish date (interviews, observations conducted a month prior).

What’s not fabricated however, are the repercussions from the so-called cure for the speck.

Unfortunately, those are happening now and are quite real.

Moving on to the trade.

Despite the number of transactions shown in the Project Stimulus table (below), the objective is to minimize activity. We’re looking for a mid, to long term sustainable move; gain potential, 100% to 1,000%.

Updated previously, very long term (Quarterly) IBB has reversed.

Monthly and weekly have reversed as well; both the monthly and weekly MACD indicators point down. Daily is essentially flat.

The hourly chart of LABD (3X inverse IBB) shows the entry location and subsequent price action. Stop is the session low @ 22.23 (not advice, not a recommendation).

It’s worth repeating, the false narrative on the speck and consequences of speck protection may blow up in the media (and biotech) at any time.

As J.P. says, getting people to do something they know is bad for them (or lethal) is the ultimate ‘elite’ high.

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.

Technical Discussion, Real Estate

“Depending on where that close is … “

That, from the last update on real estate, IYR

Price action is extracting every last bit of up-side. We’re down to the five-minute chart (above) to discuss yesterday’s move.

Any time price action penetrates a low or support level, it automatically puts that action in ‘spring’ position. Sometimes the selling is just too strong and the spring set-up fails immediately.

Other times (like yesterday), it holds.

Another way to look at it; for IYR to move higher, it had to go lower to get the needed fuel (penetrating support levels). Only this time, and depending on the data provider, IYR closed unchanged or up 0.02-pts.

So, the range in our recent technical discussion(s) has gone from 9.77%, to 1.83%, to 0.60%, 0.27%, and now, yesterday, 0.0%.

Before a market can go down, it has to stop going up … looks like we’re there or at least at the point where reversal is highly probable.

The hourly chart has the characteristic where volume spikes indicate trend change or potential change. The right side of the chart has the spikes but no direction change … yet.

Separate but related, Uneducated Economist gives his take on potential government ‘incentives’ for real estate.

Stay Tuned

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.

Real Estate: Outside-Down

It’s about 11:55 a.m. EST, IYR just posted outside-down.

There are four hours to go before the close. Depending on where that close is, we may have a key reversal in IYR.

Key reversals (aka outside-down, or up) are one of the more reliable indications of sustainable trend-change.

Of course, IYR has been closely monitored for several days with indications reversal is imminent.

This may be it.

Our Project Stimulus chart has been updated to include the market defined (as of this morning) stop level (not advice, not a recommendation):

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.

More & Less

Volume increases on IYR; range contracts even further.

In what’s beginning to look like its been taken straight out of David Weis’ training video on ‘trend reversals’, volume has surged and range has contracted drastically.

The last update had range contracting down to 1.83% (from 9.77%).

Now we’ve got yesterday’s range down to 0.60%; volume up to 18-million shares … the highest since October 2nd, last year.

One of two things is happening.

It could be absorption for a new leg upward to ever higher, highs.

Or

It could be distribution and ultimate reversal.

There’s certainly enough fundamental evidence to show commercial and residential real estate, may have gone off the cliff.

Still, we have headlines like this, from ZeroHedge.

The key is the “hottest real estate market since 2007”, part. Remember this magazine cover?

We’ve got what appears to be conflicting data. ‘Over the cliff’ on one side and ‘red-hot market’ on the other.

The answer’s in the price action. We’re at a potential (major) inflection point. The market leads the news and not the other way around.

If we’re at the pivot, about to head lower, bad news will be forthcoming after the reversal’s in place.

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.

Real Estate, Inverted

The inverted chart of IYR, shows the extremes of current price action.

The chart has a compressed time scale which may be hard to see. It was necessary to present it this way to show extreme action.

The prior update, has a wedge ‘throw-over’ that’s been one year in the making. The daily above, has its own terminating wedge formed over a six-week period.

The important part, is the range and volume.

Back on November 9th, 2020, there was a large volume spike and a move whose (total) range equated to 9.77%

Thursday, April 1st, was a similar volume spike but total range was just 1.83%; a huge (range) contraction when compared to the prior move.

This tells us massive volume is not having a significant result. Of course, if the volume persists, sellers in this area will be absorbed and IYR will move higher.

If not, this could be distribution; a reversal can be expected.

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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.

Silver: Sunday & Overnight

It’s about 9:37p.m. EST, on Sunday. Price action in the futures markets (SIK21) has silver up about +0.40%.

Projecting that action onto the regular daily session of silver, has it within the black box; located right up against the blue trend line.

At this juncture, the down-trend is still in effect.

In others markets … real estate:

A report just out by Uneducated Economist has ‘boots on the ground’ reports lumber inventory (for housing construction) is piling up at mills at levels never before seen … ‘stacked to the rafters’.

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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.

Real Estate … One More Time

A long time ago in an interview whose source is long forgotten, the question was asked:

‘How many times do you attempt to enter a trade before giving up?’

Years ago as an amateur, I was shocked. I didn’t even know that several attempts could be made.

Was that even allowed?

I thought the ‘professionals’ were supposed to know the market. If they get stopped out, they must be some kind of (idiot or) shill.

Well, you can make your own call on that one … as for the ‘project’, we’re re-positioned for one more time.

Monitoring price action throughout the day, it became obvious just before 3:00 pm; EST, that IYR was going to make a breakout push.

The DRV short was exited at 7.48 and then, we waited.

The upside breakout came just twenty minutes before the close (forty minutes after exiting). IYR pushed significantly higher while DRV went sharply lower.

Ten minutes into the breakout, as IYR was still rising, DRV was re-entered at 7.358 (see table below).

Price action continued higher right into the close. DRV finished at 7.25.

Looking at the weekly chart, the ‘throw-over’ looks terminal.

Price rose for the week but range was more narrow with volume (effort) up and force down.

The amount of volume needed to move price slightly higher increased significantly from the week prior.

Note: Each upside force (from start of the recovery) has declining energy.

For the week just ended, Force Index barely ticks higher while volume increased and range traveled decreased.

Wyckoff termed this “effort vs, result”. The bulls are tired.

The table shows current status. We’ll decide on a stop (or exit) during the next session.

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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.

Real Estate: Prints and Fails

IYR made an unexpected print high; then failed to hold into the close.

The inverted chart of IYR puts it all in perspective.

It’s obvious we’re working the area of IYR, where medium to long term reversal is possible. The inverted chart shows how each successive thrust lower (blue lines) covered less net distance.

Instead of exiting out of DRV, then getting back in, the position was held with the expectation new IYR, print highs would not hold.

They didn’t.

Not only that, there was plenty of intra-day kabuki:

Early session lower, then reversal to new highs, then fail and lower close. Anything can happen but IYR’s upward action looks exhausted.

If IYR had maintained its new high into the close, DRV would have exited (not advice, not a recommendation).

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.

What did … and did not happen

What happened: IYR pushed higher, DRV hit the stop.

What didn’t happen: IYR’s action higher, failed.

The hourly chart shows IYR pushing above the 92.50 level previously discussed.

Expectation was for a measured move higher … about 2 – 3 points.

As soon as price action penetrated the stop area, it reversed.

Shown above, is the re-entry (DRV) when IYR action posted an outside down hourly bar.

The chart below has more detail which indicates successive market rejections as price attempts to move higher

There are no guarantees. Some kind of demand could come in to move IYR higher.

However, based on the failed attempts to do so thus far, the market’s saying we’ve seen the highs for this cycle.

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.

‘Project’ Update

The stop on our ‘Project Stimulus’ account was originally listed as “TBD”.

The market itself needed to define the stop. Now, it has.

The 4-Hour chart of IYR shows a wedge pattern that’s right at resistance. The early session is over and posted a narrow red bar.

We’re just into the second half; price action is inching up.

If IYR gets above the inter-session high of 92.50, it’s likely to make one last push higher into a measured move.

We’re short via DRV (not advice, not a recommendation) so we don’t want to be around if that happens.

The Project table has been updated with an approximate location for a DRV stop:

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.