Throw-Over, Or Not?

IYR’s in a terminating wedge … will it throw-over, or reverse from here?

American Tower (AMT), the largest cap in the ETF, bounced off a 23.6% projection during last Friday’s session.

That keeps a short term bullish possibility alive. Longer term, AMT still remains in a downward trading channel.

Bonds and the dollar continue at extremes. On the dollar side, it looks like a significant bottom is in the works.

Weekly UUP, MACD has posted a bullish divergence along with an MACD lines cross (to the upside) signal.

Bonds (TLT) remains at its near term lows; near support levels formed back in September, 2019.

IYR is right at the upper wedge boundary and volume (upside pressure) has dropped significantly.

It could still levitate higher … however, it seems that getting a significant ‘throw-over’ is going to require more energy than is currently available.

We’ll see what price action has in store for Tuesday’s session.

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.

Dollar Channel Identified

There’s a possible trading channel in dollar index ETF, UUP.

The channel shown is a Fibonacci 21-days wide; added bonus is max bottom (1/6/21), posted a Fibonacci 13 days after ‘Day 1’.

These are market nuances that can be negated at any moment.

However, if the channel holds, it’s just one more indication we’re at a significant inflection point.

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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.

Ruh, Roh: Bond Reversal

Now, it gets interesting.

Bonds sold short the most in history.

Then, today’s action is reversal with moderate volume.

On the dollar side, at first glance it looks like a terrible day.

Action was down 0.53%.

The reality is, UUP came down to test an up-trend line formed as part of its own reversal last Thursday.

Both dollar and bonds are in an upside reversal; the dollar looks slightly ahead by a few days.

Real estate (IYR) has rallied (sort-of) which may only be temporary; likely on the (false) belief lower bond yields are good for higher yielding sectors.

Not true when we still have (as Van Metre puts it), the ‘insolvency event’ yet to come; everyone going bankrupt all at the same time.

Anything can happen and the above analysis could fall apart tomorrow.

On the probability side, looks like we’ve seen the extremes in the major sectors; now ready for reversal pivots.

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.

Dollar Up, Market Down?

The dollar has been inversely correlated since March of last year.

A reversal was identified in this report which thus far, has proved correct.

Bonds are also showing higher in the pre-market, having met a measured move (wedge) target last week.

The UUP, weekly close has price action slowing its decline, stopping and then reversing. That’s where we are now.

Weekly MACD ticked up (slightly) last week and higher open this morning, would confirm the divergence.

Market sentiment readings as reported by J. Bravo (time stamp 1:00) are literally, off the charts.

On top of that, internet scuttlebutt over the weekend shows at this juncture, absolutely anything can happen.

Having a market stance (or position) that includes possibility of power outages, banks going off-line, internet disruptions and general overall chaos, would seem to be reasonable.

In line with that, entries were made in DRV last week as shown (not advice, not a recommendation):

Pre-market activity for IYR, points to a lower open, DRV higher.

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 Down. Why?

We have the usual suspects rolled out; providing expert analysis on why gold went down.

The answer is quite simple. It tested a trend break, then reversed.

If we look at the (close) chart of GLD, it broke an uptrend during the week of November 20th, last year; went lower and then back to test.

That test was rejected dramatically with Gold (GLD), heading significantly lower; getting whacked down over 5%, in just two days.

This is not bull market behavior.

Steven Van Metre’s assessment (at this juncture) that we’re in a deflation event is being shown correct. The lagging factor in the scenario is the overall market … still near all-time highs.

It’s true bonds broke lower (rates up) this week but that’s another event answered by technicals; the wedge formation, discussed here.

Both bonds and the dollar have set the stage for a swift reversal.

Just how that’ll affect an extended, obscenely overvalued, stretched, call options wild market with everybody all-in, is not known.

Getting back to Van Metre; he’s reported, during this past week, small traders/speculators added to short (bond) futures positions.

If there’s a signal bonds are stretched, ready to reverse, it’s the little-guy just now getting in (going short) …. right at the bottom; as usual.

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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.

Dollar Bears Trapped

Price action in Dollar Index (UUP), shows familiar signs of a trap.

Price action closed yesterday at the low … after a prior lower close.

This morning opened gap-higher and near yesterday’s highs.

Price action then went higher … setting the hook.

Anything can happen and the bears can find some extra muscle somewhere. One gets the sense though, we’re at a pivotal juncture.

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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.

Dollar Reversal; Ready

The downward thrusts in the dollar have run their course. 

The weekly chart of UUP, shows successive narrowing of distance traveled to the downside.

The bears may have reached exhaustion at the same time MACD shows a bullish divergence.

Couple that with extreme shorting from the speculators; the trap is set, ready to close.

From a technical perspective, note last week’s price action was inside and at the top of the price range from the week prior. 

Looking at the week before that, we see price action was inside but at the bottom of the range of the week prior.

These are subtle clues; there’s a change in character.

As mentioned in previous updates, it’s all happening during holiday weeks when everyone (almost everyone) is distracted.

No matter what happens on the political side, it’s likely to be chaos.  February, is setting up to be very different from now.

We’re using Livermore’s strategic approach to the markets.  That is, figure out what’s going to happen in a big way … then get in position.

Built into that approach is recognition there will be market outages, trading halts, communication interruptions and natural disasters.

The one thing that may separate this site from others, these (potential) events are taken into account.

Seismic activity is picking up in a big way right along with volcanic eruptions.  A major eruption that will block the sun and kill-off global harvests or planting, may be in the works

The “Christmas Bomb” cut communication lines … which by the way is the very first objective during any battle; cut the enemy’s communications.

Matter of fact; that could be the ‘reason’. A test to see how badly communications were disrupted; how quickly they recovered.

Continuing on with potential disruptive events; There were broker outages on November 9th, when the market opened sharply higher. 

If it happens on the way up, it will happen on the way down.

Cyber attack has already been stated as the next gala event the elite have planned. 

There’s not one market analysis site known to this firm addressing those potentials or any others. 

In that sense, The Danger Point, is unique.

Obviously, there are no guarantees.  Anything can happen.  If one wants to day-trade, go ahead but we’re not interested.

When or if all this (or a variant of it) happens simultaneously, the general pubic is going to be stunned.

It’s possible they will see their investment accounts wiped out in a matter of weeks.

The positions remain unchanged and listed below.  The look is different as it’s taken from the firm’s own trade spreadsheet. Absolutely not advice and not a recommendation.

Note the initial stop followed by the current stop.

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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.

‘Downward Pressure’

That’s part of the title from the Energy Sector report, linked here.

Those exact words were used just hours prior, in the pre-market update

Downward pressure is increasing.”

The short position in the sector is being maintained via DUG (not advice, not a recommendation).

The stop is set to be moved after today, based on price action.

Using USO as the proxy, oil is pushing a little higher as of this report (12:41 p.m., EST) probably because the dollar’s probing new lows.

Even though the dollar’s at lows, action thus far is reversal. A UUP close above 24.38, may signal trouble for those that are short.

The markets continue to be stretched to extremes.  Based on data thus far, Energy Sector appears to be reversing (again) first.

Since that sector’s in a long term down-trend, XOP reaching its highs way back in June of 2014, we’ll remain focused on DUG.

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.

Big Money, Big Move

The big money is in the big move. 

One recent example; the bond move from late 2018, to early 2020.

During the low from October 2018 to November that year, were reports of professionals opening huge long positions. 

At the time and as the weeks went by, it appeared that nothing was happening. 

The delay would have caused the typical i-phone addicted ‘tweeter’ to lose interest many times over.

When it finally took off, bonds staged a huge directional move that lasted over a year.

Such moves are rare and require the ability to wait. Wait to get in and wait for the move; minimize transactions.

Each market transaction is an opportunity for error.  Minimize the transactions and by definition, the errors are minimized as well.

That brings us to oil and more specifically, XOP and DUG.

The nonsense being promulgated by the financial press is that oil is moving higher on ‘hopes’ for an economic recovery.

Maybe injecting the world-wide population with potentially DNA altering technology (not even tested on animals first) for an ailment that does not exist will miraculously launch some kind of pent up consumer demand.

No matter. Oil and its attendants keep moving higher with the dollar moving lower.

Even with anecdotal evidence from an Oklahoma oil field worker (commenting on a Van Metre update) that was later confirmed by the EIA report did not cause oil to move lower … yet.

That is, until today.

The dollar attempted to continue its downtrend yesterday.  Oil spiked as did XOP to the upside and DUG to the downside.

This morning is a different story.  Dollar proxy, UUP is trading (pre-market) right at its highs of the last session in an apparent reversal. 

Oil along with XOP is down, with DUG up.

Looking at XOP, we see it’s hitting a long-established trend line. 

With the dollar, bond, and overall market extremes, no recovery in sight and more probable, another (and complete) collapse; this may be the spot (not advice, not a recommendation) to position for medium to long term on the short side.

That’s exactly what the firm has done.  Looks like our position was a day too early as we sat through yesterday’ spike lower in DUG.

Volume remained heavy for that DUG session. Weekly volume is looking to be the largest (big-money moving in) since at least 2015.

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.

Testing: 1, 2, 3

The dollar has reversed and is now testing the lows. 

Conversely, when we look at the price action of gold (GLD) its collapse exactly mimics the dollar’s reversal.

Taking into account the futures market activity in gold, it made new daily highs last week during the overnight session, Sunday-to-Monday. 

Using that knowledge on GLD, (adding it to price action) it retraced to 38%, of the recent down move this past Friday.

If we’re in a real bona fide reversal of the dollar and gold (posting more confirmation on gold tomorrow), then expectations are for continued gold downside during the coming week.

The dollar, bonds and gold, at this juncture are moving in tandem:  Dollar and bonds up, gold (and silver) down.

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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.