10 October 2018

Stocks and Precious Metals Charts - The Greatest Show On Earth - A Banquet of Consequences, Part I

"It's probably early days, but now might be the time to start taking precautions against a 2008 class event in the financial markets. I would suggest it might arrive anytime between now and July 2020. These sorts of things depend on the magnitude of any 'trigger event,' which is why it is so difficult to forecast with regard to specific dates. As time goes on the required force for a market moving event decreases until it takes very little to set that ball in motion."

Jesse, 24 July 2018

"Welcome to October, the month of unexpected falls from heights, and stock market tears."

Jesse, 1 October 2018

"The VIX futures were in contango today. That means that the nearer term months were at a higher value than the following months. Usually it is the other way around. backwardation, with the futures in the following months gradually increasing in price. This is a signal that a nearer term and disruptive spike in risk is being expected by a number of traders, and they are seeking protection from it.

If you look at the NDX futures chart below, you can see how every day for the past three days that the futures have slumped heavily lower, recovering a bit in the afternoon while Asia and Europe are asleep, only to drop sharply again the next day, and fail to completely recover.

Stocks may turn around and rally higher from here. But the risk for equities is pronounced."

Jesse, Monday, 8 October 2018

“We have been in a state of stagnation since 2008.  We’re moving towards stagflation.  It feels good right now but it’s a false dawn.”

Alan 'Bubbles' Greenspan

Ba da bing, ba da boom.   Le voilà.

Stocks were down sharply on very heavy volumes. They went out near the lows of the day.

Today was the kind of day when you could almost feel your IQ start to decline from listening to the spokemodels and guest commentary on financial television—   a 'contact high' of hubris and self-delusion.

We can always hope that our tax cut flush companies will start buying their own stocks again once earnings season is underway and they make their announcements.

We may get a decent attempt to rally back up some time, likely after some follow through to the downside. The ESF might take a shot at it tomorrow, but if these volumes keep distributing to the downside I don't think they have enough ammo to turn it around. They might have to wait for a capitulation first.

The 2770 level on the SP 500 Futures chart looks like an important support level.  Below that the bulls will need to start taking Xanax if they break 2740 and stick a close below that.

If the market turns and puts a multi-day rally together, and starts approaching this last blow off top, and it fails, look out below.

Either way, there is most likely much worse to come with time. That we expect something different is remarkable, a genuine triumph of modern persuasion, the power of dark money, and old-fashioned demagoguery.

Need little, want less, love more. For those who abide in God abide in love, and love in them.

Have a pleasant evening.