‘Fed – Fake’

After The Close

One-Way Before

Opposite-Way After

As is typical of Fed announcements, the market tends to go one way before the speech … then, the opposite way after the speech.

As real estate (IYR) pushed higher before the speech, it got just a little too far upward for comfort. The short position was closed out for one managed account.

As time progressed, price action was clearly setting up a spring condition; seen in the 30-minute leveraged inverse fund DRV, above.

The Project Stimulus Account closed its TZA position (for profit, table to follow) and the account then positioned long DRV, at about 4.49 (not advice, not a recommendation).

The stop is tight … the low of the day @ 4.42 (not advice, not a recommendation)

We’ll see what happens next

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.

Alternate Viewpoint

Mid Session

Gregory Mannarino, Updates

According to Gregory Mannarino, everything’s fine in the bullish camp.

The Central Banks still have it all firmly under control; ‘Evergrande’ is a non-event.

He’s clear on who’s really in charge of the world system … and likely correct.

We’re not yea or nay on Mannarino’s assessment. Jut providing it as a different viewpoint.

However, there are many types of ‘Black Swans’ … not just financial ones (on which he is focused).

One such potential is here.

If there’s a major volcanic eruption (Level VEI 5), the entire world dynamic will be changed instantly.

Not saying the La Palma eruption is another Black Swan … no, just that volcanic activity is picking up world wide and needs to be included in any ‘unforeseen’ event situation.

Real Estate (IYR)

Back at the markets, let’s see if everything’s ok in the bull camp for IYR.

The short answer is, it’s not decisive for either side as of this post

4-Hour Chart of IYR:

If we put in a Fibonacci retrace and then highlight the resistance area, it paints the picture more towards the bears:

Price action has reversed from a well defined resistance area … that just happens to be a 38.2%, retrace level.

So, we’ve got an excellent demarcation line.

If IYR price action gets significantly above the 38%, retrace, we’ll close out the DRV short (not advice, not a recommendation).

However, at this juncture, price action continues to retreat from the 38%, area. A good sign for the bears.

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.

Goes Down … Stays Down

Livermore’s Rules; Going Short

From his 1923 book (Reminiscences), Livermore’s rules for going short were fairly blunt:

‘I’m not interested in shorting a stock until it goes down and stays down’

It’s possible that’s what we’ve got with real estate, IYR.

This past trading week was IYR’s opportunity to regain balance and attempt to move higher.

It didn’t happen.

Instead, we got a struggle for several days; ultimately breaking lower, late during the Friday session.

Note the volume increased markedly from the day prior.

Summary:

We’re short this sector (not advice, not a recommendation) via DRV. There are times were significant reversals start slow and take time to build … this could be one of those.

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.

Gold Miners Channel Lower

10:47 a.m., EST

GDX In Trading Channel

Follow On To ‘Up-Thrust’ Analysis

First, let’s start with the July 29th analysis of GDX. That update showed price action about to ‘Up-Thrust’ into a reversal.

The update even gave a possible high for the top of the developing set-up.

That high was in the area of GDX 35.65, near the 38% retrace level.

GDX topped-out at 35.82; then reversed.

The set-up chart is shown below and followed with the price action result:

And the result …

Pulling out to look at the weekly time frame, it’s clear, GDX is in a down-channel.

The magenta arrows show channel contact points:

Summary:

Gold and the miners are not showing hyperinflation at this juncture. It’s just not there.

Something else is going on.

As with the real estate index (IYR) not reversing as expected from collapsing retail purchasing (within established malls and elsewhere), gold and the miners are not moving decisively higher.

With real estate, It came out months later (after abandoning shorts on IYR) that Black Rock and others had been buying up whole sub-divisions … specifically from D.R. Horton.

With gold, it may be something else.

As proposed several times, the ‘controllers’ may make it irrelevant.

For example, some parts of Australia are completely immobile.

If you can’t get to the bullion dealer to either buy or sell, does it really matter if the metal’s in your possession?

This is a long-term game and this site’s in it for the long haul.

Each side making its chess moves. With that, it’s probably a good idea to review the standard plan of those on the other side.

Anecdote:

From a personal standpoint, as this post is being generated, there’s a Leghorn Rooster in a dog kennel cage (in my office) that’s been crowing for about two hours.

The same one (only much larger now) seen in this brief video.



Roosters are absolutely verboten in this neighborhood.

He started to crow decisively (collar or not) about a week ago; starting around 6:30 a.m.

He was not part of the plan. The five chicks were all presumed to be hens and his appearance was sort of an accident.

Several iterations later, which included sound-proofing the garage, he’s got his own set-up in my office.

It’s been about two and a half hours now and it looks like he’s done crowing. Soon, he’ll be off to check out the hens and be on with his day.

As a result of his arrival, we’ve changed our thinking: It may not be long before sentiment (to the food supply) changes instantly. It’s possible everyone at that time will be clamoring for their own livestock … crowing or not.

They’re no guarantees we’ll be able to keep him a secret (but God willing).

However, if he can be kept on the down low and then food supplies are cut off or severly curtailed, we’ll be more than happy to offer “Stud” services … for ‘small’ fee 🙂

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.

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

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.

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.