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Saturday, July 25, 2020

Weekend Charts and Stuff

WAVE (2) TOP TICK MOMENT?
Can anyone think of a better possible "top tick" moment for wave (2) other than the President of the United States (biggest stock market cheerleader) being interviewed by "Davey Day Trader" David Portnoy? It happened Friday. Story via Zero Hedge.  The interview was likely arranged on or about July 21st, the day of the NASDAQ Composite high (so far LOL).

Toward the end of the interview when Portnoy mentioned he got into the stock market, the President had this to say:

"A lot of people sold stock, and now their saying 'I missed it'. I said to people don't sell, don't sell, just don't sell, because the foundation is so strong, don't sell. But the people that really lost in terms of economics are the people that got out. The people that stayed in, they stayed with me, and they're doing great. And we're almost at record highs."

Maybe we have one more pop, maybe not, but if that's not a top tick moment, I cannot think of a better one.  

"And we're almost at record highs."

I give Portnoy a lot of credit. If he stays in the market he'll likely take his lumps being so one-sided long, but he could adapt and be a prolific short seller and still beat all the talking head "gurus" you see week after week on bubblehead TV.  (well not me, I actually don't watch tv much).

CHARTS
The awesome-looking expanding triangle in the Wilshire 5000 (and it really only exists in this pure form on the Wilshire), gave the market "energy" to rebound no matter how the count winds up counting or how high we go.

Again, from the May 22nd post:


"What would the wave count be for this proposed (5)? I think it would look very similar to wave (1) rebound off the 2009 low. A very fast affair with the subwave 1 being the longest and strongest. It took about 18 weeks for 1 and 2 to develop for (1), its taken about 40% of the time for proposed (5) waves 1 and 2 to develop. Therefore if this alternate long term count panned out, I think about 5 months to the peak of (5) maximum. Say August 2020. And it would be totally handed off to retail."

You can add stubborn (greedy) mom and pops who want to make every nickel they can. They might not be CEO's but humans are humans. (Which is why the Fed too will flinch).

We are reaching the last week of July. If the market is going to make another effort higher, it'll have to start this week from these levels.  
Remember this is the entire market. Within 3.3% of the all-time highs with 10's of millions unemployed. There has never been a greater disconnect with reality than now. The trillions of "free money and credit" created out of thin air (at the top no less!) is unimaginable.  

We are at peak lunacy. "It'll never be paid back" is exactly correct and any sane person knows it.

We elected a black President which signaled a top in a 240 year rise in social mood and race relations.

We elected a businessman for the last gyrations of this multi-century rise. How fitting. And an avid stock market watcher.  And he knows a thing or two about bankruptcy so maybe he is meant to be re-elected to oversee the coming crash. China does own much of our debt, and you know he really wants to stick it to China. 

Either way President Trump will be blamed in the coming crash even if he is not reelected.  Wouldn't be fair, as the debt bomb was heading to its final peak conclusion no matter who is "in charge". Social mood trends cannot be stopped by any one man or woman.

Rather, Trump the businessman being elected President is the culmination of a 240 year rise in social mood ending in a financial bubble the likes the world has never seen.  It is no coincidence he was elected President at the top of the bubble. 

One has to quietly chuckle when you read stories that suggest Biden and the Democrats will be "good for the market". The stories merely extrapolate the past and expect the same to exist in the future.  Again, social mood is a train that cannot be stopped. Its nature. When nature gets out of whack for an extended period of time, it reins itself in. This is Elliott Wave theory in a nutshell. 


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