Beginning at time stamp 6:24, at this link, The Maverick goes through an investigation into NVDA, projections.
‘Something doesn’t add up here ….’
That report was three weeks ago. What’s happened, lately?
As of the close this past Friday, NVDA, the largest in the SOXX, was at $1.1-Trillion, market cap. A distant second, is Taiwan Semi (TSM) at $545.5-Bln.
Below, we have a confluence of events for the SOXX.
Semiconductor (ETF), SOXX, Weekly Candle
We’re at the top of a trading channel.
We’re in Wyckoff ‘Up-Thrust’ (reversal) position.
A lot of volume expended with less (net) upward progress than previous volume spike; ‘effort vs. reward’.
Getting down to the daily, we see a terminating wedge that’s coupled with reduced volume.
Semiconductor Index SOXX, Daily Candle
So, what does that mean?
The ‘probabilities’ for more upside are, or have been, reduced significantly (not advice, not a recommendation).
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.
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.
Was that the day where irrefutable evidence like this is going to stick?
Price action of Biotech Sector IBB, has posted a long awaited and anticipated reversal signal (not advice, not a recommendation).
We’ll look at that below.
The IBB, Up-Thrust & Reversal
As a reminder, in Wyckoff terms, an ‘up-thrust’ is where price action struggles above known resistance for some period of time and then reverses to the downside.
In the case of IBB, that ‘struggle’ lasted an incredible seven-weeks.
Biotech IBB, Weekly
Price action attempted to break above resistance for nearly two-months, before reversing lower.
Then we had an initial test during the week of 12/23/22 (on the daily for three days), and a secondary test last week.
Biotech IBB, Daily
The daily shows more detail on the struggle.
Point No. 1, was the initial test. Point No. 2, was the secondary test which appears to have decisively failed.
Pre-market action shows IBB, set to open slightly lower.
If it does, then expectation is for some (brief) attempt to rally as a test of the breakdown.
The Driving Force
For years, this site has not wavered in the assessment, what’s happening in this sector, will be the driving force for the entire market on a go-forward basis (not advice, not a recommendation).
Anything can happen.
It’s unknown if yesterday was ‘the day’.
What is known however, evidence is building on a massive scale. Every day, sometimes multiple times a day, we see the effects.
Positioning
This site presents the data, the insight and price action nuances. It does not give recommendations.
With that said, going short this sector is not as straightforward as the other major indices.
IBB, may be shorted directly but will likely result in a maintenance fee from the broker.
Of course, that puts one on the hook for the sector’s dividend payment (currently yielding 0.31%).
The other option is 2X leveraged inverse fund BIS.
However, this fund’s volume is thin … meaning it’s not nearly as liquid as the other inverse funds such as SDS, DXD, QID, SOXS and so on.
It’s up to the trader/speculator to participate or not.
We’re about fifteen-minutes before the open. Let’s see what happens next.
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.
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.
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.
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.
A massive four-year top, along with the latest ‘road-map‘, has this one going down; most likely, for good.
While other chip makers, have gone to near stratospheric levels such as Nvidia, with its 23,960% gain from 2009, lows, Intel has languished.
The rest of the markets, S&P, Dow, QQQs, have pushed on higher while INTC, has spent the last four years, in a trading range.
A sideways market is a bear market.
Intel never recovered its luster after the Dot-Com mania of the 2000s. Price action spent eight years heading sideways-to-down before bottoming out in early 2009.
After that, it’s been a long struggle to current levels.
Now, the markets have reversed and the economy’s collapsing. We’ve likely seen market highs that won’t be repeated in the lifetimes of anyone reading.
Friday’s announcement may be the kick-off for sustained price action to the downside.
INTC, Chart Analysis
The daily chart shows at least one breakaway gap and possibly two.
The next chart is on the weekly timeframe and identifies the long, multi-year, topping pattern.
When looking at these patterns, be reminded about the scale of what’s happening.
This wedge is massive … at least four years in the making.
Note: Price action finished the day right at the lower support. There could be a rebound on Tuesday (market’s closed Monday) or we could just keep going lower.
The SOXX Connection
Intel’s fifth in market cap of the SOXX, with Taiwan Semiconductor (TSM) at the top of the list.
Even the leader TSM, may not be immune to trouble.
Here are Fab locations for Taiwan Semi, located just off the coast of mainland China … nothing bad going to happen there, right?
In the case of the ‘wave’ analysis, if it proves correct, we’re possibly in for a sustained ride lower.
The daily chart of SOXX, shows each analysis point where a reversal lower was projected.
It’s clear from the chart and documented links, both methods nailed it … to the day.
Elliott was earliest and caught the exact point of inflection.
Wyckoff caught the test of the up-thrust.
Here’s the important part:
Wyckoff is a practical, bread and butter method. It looks at what the market’s saying about itself … is price action showing pressure to the upside or down?
Elliott Wave looks at where the market could be or is going.
If we’re really in an Elliott Wave Three down, it’s likely to be a decline like no other.
There are other indicators not market related, giving us hints, a massive collapse is ahead.
A Decline of ‘Biblical’ Proportions
Warning:
The following contains scriptural references.
Those who are in ‘it’s all a myth and fairy tales’ crowd, feel free to scroll to the ‘Summary‘.
For the rest of us, the secular world calls it ‘systems collapse’. The spiritual world calls it ‘judgement’.
Stated many times on this site, ‘the church’ is corrupt. Here’s just the latest salvo proving that point.
Along with the corruption, we now have the strong delusions prophesied over 2,000 years ago.
In reference to a Stew Peters broadcast, linked here, on the numerous media lies, is this comment (emphasis added):
“The only people to blame for this Stew are the ones who put on the mask, who distanced, who took the shot, who harassed other people and who advocated for my freedoms being taken away. Without doing five minutes of research.”
It’s not too much of a stretch to say, those who voluntarily injected themselves were (or are) in a place of delusion.
“And for this cause God shall send them strong delusion, that they should believe a lie:”
However, the injections are no lie … but the reasons for those injections are false.
Can this (spiritual assessment) really connect with what’s happening in the markets? How does it relate to actual price action?
Obviously, it can’t and shouldn’t be said that any specific price movement has been prophesied.
However, we can use the scriptural references to point us to the probability of events; the big picture, the situation at hand, the signs of the times.
The probability that we’re at some kind of major inflection point of Biblical proportions, seems exceedingly high.
Summary
Both Elliott Wave and Wyckoff Analysis, support the probability of lower prices ahead for the SOXX.
Because Intel (INTC) has been a laggard in the sector for years, suggests it may be one of the downside leaders.
As if to confirm the assessment we’re past the pivot, that generational highs have been reached, we have this just out, on ZeroHedge.
At the very bottom of the article, is a quote.
No, they’re not quoting from the King James Bible of 1611; they’re quoting from Shakespeare’s Richard III, of 1594.
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.
It’s been long enough; most have forgotten the ‘Flash Crash‘ of 2010.
That crash happened in May of that year.
May of this year, would make it 12-years and interestingly, a Fibonacci 144, months.
Normalcy Bias:
As Nissam Taleb said in his book, ‘The Black Swan’, every day is like every other day on the farm, for Mr. Turkey … that is, until Thanksgiving Day.
Let’s take a look at the historical chart of Semiconductor ETF SOXX, and see the effect of a Flash Crash.
Easy to spot … prices did recover by the end of the day.
What about the next time?
This report just out on ZeroHedge, shows liquidity is drying up in the bond market. Actually, liquidity has been drying up ever since Dodd-Frank of 2010.
All of this is working (to increase risk) in the background.
Let’s take a look at another unprecedented event … the downthrust and apparent recovery in the semiconductor index, SOXX.
SOXX, ETF, Daily Chart
First up, is the unmarked chart of the index.
Next, we’ll show the recovery higher is on diminishing volume.
There’s no real commitment to the higher prices …. they are just drifting upward.
We’ve already shown the Elliott Wave assessment of the current structure. Now, let’s look at it from a Wyckoff standpoint; Up-Thrust and Test.
Price action posted an Up-Thrust, declined and now has come back for an apparent test.
Confirmation Bias
At this juncture, both Elliott Wave and Wyckoff Analysis present a price action structure that’s set for downside reversal.
In a way, we’re at the danger point for both methods.
Summary
From a personal and corporate standpoint, going long in this market and all markets for that matter, was abandoned long ago (not advice, not a recommendation).
To borrow a phrase from Dan at i-Allegedly, he repeats over and over in his videos, ‘We’ve had warning, after warning’.
So, we have.
The SOXX, is telling us, it’s ready to resume action to the downside. After-hours, already has the index trading lower.
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
p.s. The insight of 2010 Flash Crash, anniversary of Fibonacci 144 months in May of this year, is exclusive to this site.
This site does not use Elliott Wave as a primary analysis tool.
However, to be aware of the technique, will at times provide an additional edge … like now.
Number Two:
Once again, gold and the mining sector have become unbearable to watch.
The amount of hysteria, hype and bloviation serves to make this market all about ego. Ego is a four-letter word for the professional speculator/trader.
We’re leaving it alone for now and moving on to the market at hand: Semiconductors (SOXX).
Semiconductors, SOXX
On a Monthly basis, the chart below is the entire trading history for the sector:
The next chart zooms into the area(s) of interest.
This market, the semis, had its most powerful thrust lower in January, for the entire history of the sector.
The following chart is where it gets interesting.
Elliott Wave labeling as shown. If correct, Wave 3, down has just started (not advice, not a recommendation).
Warning:
My former mentor, the late David Weis, who once worked for Prechter, said the approach is a “cookie cutter” (his words) attempt to force the markets into a pre-defined construct.
With that caveat in hand and the understanding the ‘wave’ could fall apart at any time, let’s see what it would project if price action followed the current labeling and structure.
The daily chart shows a Fibonacci projection based on the Elliott Wave labels:
The projections are in percentiles of the first wave distance.
Elliott Wave rules are that ‘Wave 3’ can’t be the shortest wave. If the structure holds, that means Wave 3 (if that’s what we’re in) would go below the 100%, level and potentially to 161.8%, level.
To Trade, or Not To Trade:
This structure was spotted late yesterday … after abandoning the gold sector. There had already been the pre-requisite hype about CPI numbers and such giving the ‘excuse’ for markets to rise.
That meant risk of a short position (yesterday, early today) was low: not advice not a recommendation.
The chart below of leveraged inverse fund SOXS, shows entry points for what is now: SOXS-22-01
Summary:
Taking a cue from the late Dr. Martin Zweig, on his words during this broadcast, he was very hesitant to use the word ‘crash’.
So, this update is hesitant as well.
However, if the forecasted move of SOXX, to the Fibonacci projected 161.8% level (or more) is realized, it’s a decline over – 37%, from current levels.
It would be significant … crash or not.
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.
However, this fund is not like inverse ETFs; SDS, DXD, SOXS, QID, DUST, and so on.
Basic Materials is not ‘popular’. At least, not yet.
That means the fund is illiquid with larger spreads (bid/ask). In addition, it takes a good few minutes after each open for those spreads to calm down and narrow up.
It’s not for the inexperienced.
Summary:
As we’ll get into tomorrow, ‘normal’, is gone.
There’s not going to be ‘normal’ (a personal opinion) in the lifetimes of anyone reading these updates.
That doesn’t mean there are no opportunities.
Basic Materials, DJUSBM, is about to, or already has (potentially) started its downside reversal.
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® 