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Saturday, January 30, 2021

Weekend Charts and Stuff

Update:

NYSE Daily. We have had only one 80% up volume day on the NYSE in 2021 that was on the 6th of January which took prices upwards. The close on Friday was back below that candle.

Update:

ROBINHOOD UPDATE 

Again, great info here from ZH. A lot of Robinhooders may indeed be the ultimate bagholders because they may be trapped in their own trading platforms. Their only mistake? Trusting a relatively new app that promoted free trading and putting lots of money in it not knowing that it all may blow up and take their money with them. Hopefully not.

Update:

SILVER 

I really haven't posted any opinion on Gold or Silver since I followed them to their September peaks and they both pulled back. Gold made a new all-time high, yet silver was far below it's high.

But again, another article from Zero Hedge on a potential Silver spike made me look again. Its been a while but now is the time to take another look at silver.

At the very least, a good interpretation is that Silver is in an A-B-C situation and they have yet to get a wave C to break above A.  The weekly shows where it has held above major support at about $20.50 range.

And the daily shows a second support range higher that has had 3 mini "tests" and has bounced up on some volume.  It seems it may be poised to finally move higher if this is indeed wave C.

Physical is trading almost in lowish to mid-$30's, so $30 minimum seems a good starting point for a C wave target. If we have wave [i] of C already formed, then wave [iii] should push things higher in rapid fashion.
Oh I forgot its a classic "cup and handle" pattern potentially as shown the example from Chart School on Stockcharts

Update:

I linked this article below but its the best explanation of the clearinghouse plumbing explained in simple terms that I have read so far.  So yes, Robinhood does/did have a liquidity problem, because the RH clients are taking one-sided bets mostly in margin accounts. I didn't realize most accounts on RH were margin accounts and that seems like a purposeful fraud. (Remember the suicide over the past summer as a result of not understanding margin or specifically how it clears?) I did not know that margin accounts actually didn't "own" their purchases the same way as a regular account (I closed my margin account years ago and have a regular TD account).

So apparently RH steers you to a margin account on signup. Did not know this!  (like I said never used the app).  This explains why they are having the most exposure to potential liquidity/counterparty problems. It also explains why they didn't have a bigger buffer since steering clients to margin accounts means less liquidity requirements (normally) for RH.  Apparently, $1B is not enough clearing/counterparty buffer in the current market in which RH is experiencing the greatest distortions.  Interactive Brokers mentioned they have $5B in liquidity buffer and said that's enough for them (for now). So perhaps RH actually may need somewhere between $1B and $5B of liquidity to handle their current situation (that they themselves got into) they are in? Or much more if things really get goosed?

That would mean come Monday/Tuesday, they are likely to be more problems with RH. And more forced liquidations of client's stocks without consent (because they can!).

Also in that thread from ZH in that it has now become Hedge Fund vs. Hedge Fund. Yet you can include WallStreetBets and consider them the largest "hive" (as Zero Hedge described) hedge fund perhaps on the planet. Now that there are 7 million members even if each only had $2000, well 7M x 2000 is $14B. 

So to dismiss WSB at this point as "just retail" is silly as combined they have real buying power of a hedge fund and apparently Robinhood let 'em all have margin accounts to boot!

So the "narrative" is still correct in its the "little guy" (Wall Street Bets - and multiple as-of-yet undisclosed Wall Street hedge funds) vs. Wall Street Hedge Monsters.  Pass the popcorn!

And since a (majority?) of WSB use/used RH, they are trapped in a shitty situation. And if most are actual margin accounts, RH can do as they please with ANY of it.

Its going to get ugly. The "narrative" is that there is real systemic risk (hey that's the system the elites themselves setup yes?) to the overall marketplace. 

But its a freaking lie....or the Emperor has no clothes.

You mean to tell me your shitty overleveraged fraud of a market is so delicate it can't handle a few short squeezes without suffering a major heart attack?

It seems that's exactly what your saying. 

SHORTMANIA SQUEEZE EDITION

I've been making a lot of fun of "Robinhooders" over the past 8 months or so figuring they are the ones that will hold the bag when the market finally turns. I think I was wrong on that.  I don't think I ever mentioned WallStreetBets, but yes, I suppose looking back you could say I somewhat equated the two. 

I never liked the Robinhood app (not as much as I don't like electric cars!). Never downloaded it. Never would trust it.  The "trust" part was probably well-founded as you have seen that they have screwed over their clients at the first sign of volatility. They also had problems in the March 2020 collapse.  I use TD Ameritrade and yes, I could buy AMC, GME and a few others no problems this past week. The issue is with Robinhood. 

But I was wrong about Robinhooders. They started a short squeeze frenzy (and no doubt there is also quietly big money coming in to take advantage) and I think this story will blow up huge this week much more so than last. If you haven't heard about it by now, you will by the end of next week. I have been checking all the usual places both "left and "right" and they all have their story angles on this issue.  I have been paying attention for the last several weeks about the short squeeze situation and had read last Friday's Zero Hedge post on it. When this past Monday's price action proved the phenomena was taking off, I knew it had legs.

What is surprising is that we may indeed have a market collapse (or not? I have a count either way) while the short squeeze in select stocks continues. Under pressure to sell longs (such as Apple, etc), the hedge funds seem to be the ones that might end up holding the bag at the top.

Many outlets are taking the angle of "it will all end badly for the little guy as it always does".  And it just may, but that sentiment is just another example of how everything that happens in the past is forever extrapolated into the future. At some point paradigms change, and one has to be open to see it. I think we are at one of those junctures in a lot of ways. Wall Street's own hubris and arrogance has brought it on themselves. Their construction of the system using extreme leverage to their own benefit will also result in their destruction.

So I sort of take the opposite stance now seeing just how ridiculously large some of these floats are shorted. I think retail will actually win the price war. However....

Yet I also assume the SEC will step in at some point if things get bad and screw retail over hard and force them to liquidate positions. How? By ruining sacrificing Robinhood (and Etrade if they have to). They'll stop the trading in the volatile stocks just to save Wall Street. I assume the White House and Pelosi and others will be the ones directing this. All in the name of "market stability". This will be no different than the election in my eyes. At some point an "official" narrative will form and well, that's that.

If Robinhood gets their own version of squeezed (and it seems they are), their entire brokerage could come to a screaming halt. Indeed it may well have a very outsized reaction on the markets. But we really don't know what will happen.  All I know is, I don't think it's over by a long shot.

One other thing, all these analysts saying GME is not worth anything? Well, last I checked they are worth $22B.  Who is to say if they hit $1000 they won't issue equity and be flush with tens of billions in cash to do whatever they please? Maybe even buyout another corporation or 2? What then, won't their "worth" be adjusted accordingly?

ORIGINAL POST

Posting some weekend charts. I'll keep the ranting to a minimum. I'll just keep tacking things on at the top as the weekend goes along.

MACERICH  CO. (Real Estate Investment Trust - REIT - MALL OPERATOR) SYM:$MAC - NYSE

This is one of the heavily shorted stocks I showed last week on both Tuesday and Wednesday (along with GME of course). This one has been a bit off the radar though which is why I picked it. Also because Gamestop stores physically resides in MAC malls in a sense. If you want to save Gamestop, you need to save the mall properties that house such enterprises. And they are worth saving. 

This ticker hasn't shown up on anyone's restricted list just yet.  But it made the news Friday on an explanation of why it sold a bit harder than the other shorted stocks this week. An Ontario Pension Fund dumped all 24.5 million of its shares at an average of about $20.00. That's a big dump of course.  All the major financial pubs carried the story

I wonder if they pulled the trigger much too soon? Is an Ontario Pension Fund considered "smart money"? Not usually. So as a contrarian indicator, I'm assuming this stock has further to run. After all, it has some 50% of the float shorted and a direct link to Gamestop.  Again, this is not investment advice. I am merely using this under-the-radar-stock as a barometer of what's going on in the markets. I also picked it because it has (yet) to be "restricted" in any kind of trading as far as I know.  In that sense it should offer some decent feedback on underlying market mechanics vs. GSE which is heavily restricted on Robinhood and all eyes are on it. MAC may be under the radar a tad bit but its volume has been trading very, very heavy of course.

Again here is the daily chart.  May I ask again why was 60-70% or more of this float shorted when the stock was below $8 for most of 2020?? Are these hedge funds lazy, stupid, greedy and full of hubris or all four at the same time? (I answered my own question)

If I were to count the short term chart since the November low (which is when this short squeeze mania generally started), its only been 3 waves up.  

Prices are at a critical spot. They are near major horizontal support in which about $15 is the floor of that support.  So Monday will be a very telling day on the fate of this Gamestop Mall Stock. I suppose we'll actually know in premarket on what the week may be like. 
And even on a shorter scale, is this a falling bullish wedge? I guess we'll see. 




Friday, January 29, 2021

Elliott Wave Update ~ 29 January 2021

Update: 

Here is the top alternate count if the "top" is not in. Basically a move down to the blue "base" channel and a bounce off. Something to that effect. Here I have it labeled as the 5 of (5), and not the (B) wave but its a moot point at this stage. I could replace the "4" with a B and the "5" with a C it would be all the same. 

Update:

Here is Jim Cramer of CNBC fame sounding very agitated and telling WSB "You've won, sell the stock and go home".   He is no doubt getting heat because he actually took the side of the "little guys" when it was only headed to $80 earlier in the week.  Something big is brewing, they sent Jim out LOL he knows he has no sway!

Do the opposite of what Cramer says always!  I have a feeling next week is going to be very turbulent.  The SEC is likely to step in and stop trading on GSE and a few other names.  And then they will get OWS2.  

I smell a "scorched earth" strategy being developed as Wall Street has clearly backed themselves (and their enablers - i.e. - the Uniparty "elites") into a corner. Even if they stop trading in GSE there are MANY other horribly shorted stocks that cannot be possibly covered. It'll be like "whack-a-mole" and it will be blatant. The only possible "cover" (pun!) the elites could have is if the stock market crashes like you would not believe and only then may they shift sentiment a bit - or so the thinking goes. (but it won't!) 

Basically they will burn the system down to "save it" (save themselves). Hey they came out of the 2009 crash ok and they figure it won't be any different. Scumbags all of them. Mood is a wee bit tad more on the ugly side and it will fail spectacularly. 

They will NOT take the losses. They will steal your money right out in the open just like they did the election.  And of course, they will blame Trump.

LOL pass the popcorn!  I'll be in amazement watching all the pretzel-twisting logic that is sure to come!

And oh yeah, The DJIA closing high was...election day the 20th. Intraday high was a 1 minute pop on the morning of Joe "Dementia Brains" Biden's 1st full day in office, the 21st.

We are all in the best of hands. Well, at least we'll get that global warming licked, yeah baby!

ORIGINAL POST

Officially, the month was red for the Wilshire 5000 believe it or not. It opened at 39,456 and closed at 39,396 producing basically a long-candled potential Doji candle.  

Volume was historic to say the least and dwarfs anything that has come before. The computers probably cannot handle more volume than what has occurred this month. There are already obvious distortions and we are near an all-time peak! Real selling hasn't even begun!

[And I'll keep repeating this because all the Wall Street apologists have yet to point out the obvious: You hedge fund guys are down $50B at a market peak???  We are supposed to bail you out now? What happens if the market collapses? What then? Bail you out at the top and your bank enablers at the bottom?? Or are you all just one and the same? Hint: there won't be any $$$ or social mood to be bailing out anyone at any time.]

The monthly is shown as the "false top" expanded 3-3-5 flat (B) wave count. If (B) is over, (C) should be commencing now forming 5 Minor waves down to complete the expanded flat formation. (C) as a rule (being an expanded flat), is required to finish under the price of (A) which was the March 2020 low. But for the structure to "look right", ideally it finishes much lower. My best guess is the twin peaks of 2000 and 2007 approximately Wilshire 15,000 which would act as its most natural support.  Back of the napkin calculation puts that at about a 63.5% market loss from peak.

Prices back to 2007? Is that really so crazy when we are looking at stratospheric mania that has gone on for 10+ solid years and particularly the last 8 months or so? 

The Wilshire weekly. This is shown as the (5) of [5] count. Again, both are acceptable at this stage and I will freely intermingle the 2 counts as in a way they seem both correct.

Classic waning RSI and rejection of prices from the upper channel line after a small poke through the top.
Daily.
Hourly. Series of one's and two's down?
I think I downloaded this chart on yet another Zero Hedge Marketwatch post (hey they post great stuff so I might as well use it and give them credit - but I lost the link)

Regardless its a BofA chart. House price index.  I added the 1 - 5 and also the contracting triangle lines for "4". Yup, house price index has probably peaked.
GME.  The big pullback the other day seemed like a gap cover. Your classic "stop run", particularly since it rebounded so hard. Today may also have been a gap cover move. 

Did the big banks hedgies all cash out their short positions on a float that is probably still over 100% shorted? Um I doubt it, that's why they are squealing to the flunkies at CNBC, Marketwatch, politicians and whoever else to cry an uncle for them in the name of "market stability".  You see they are threatening you. First the SEC "may investigate Reddit WSB". Then they throw the "foreign interference" card at you. 

They are actually trying every demoralizing trick in the book because sentiment has already shifted hard and public opinion is clearly on the side of the "little guy". I heard a group of young men, some in their 20's some in 30's and some in 40's walking past each other in a crowded hall and one says, "Gamestop!" out loud the other turns back and says, "AMC! They're the ones to watch!" (the guy in his 40's said that).

They know the story. I doubt they are participating or maybe they have a stake in things but knowing these guys it surprised me they were even aware of the story. The story has been "framed" (properly) as "the people - aka - the little guy" vs. Wall Street Hedge Monsters and no amount of whining or craven politicians are going to fool anyone at this stage trying to convince the public of anything different. 

The "Elite" keep throwing crap against the wall to see what will stick and thus you'll see this "problem"  being approached from many, many angles this weekend. From "threat to the Republic" to whatever. You'll hear it all. And the "elites" (many who have direct connections and family members working for Wall Street) will have all weekend to hatch their evil plans. Don't be fooled by any of it!

[For instance, now the official "reasonable" explanation for Robinhood restricting buying in targeted equities is Dodd-Frank made them do it. Bullshit. If they have tapped $1B, they should be good-to-go instead of restricting shares today. Its a f****** lie. Update: looks like their business model is rapidly collapsing...is RH a complete ponzi-scheme fraud ready to be exposed???]

By Monday, they'll have settled on blaming Trump, and thus the elites "must" now respond as a result. 

LOL, they took Trump's mouthpiece away!  He is not even able to stick his foot in his mouth any longer! See how short-sighted they are?

Who wants to make a bet that TWATTER offers to give him his account back?

Who on CNBC will peddle that suggestion first?

LOLOLOL!  Pass the popcorn!

I'll have more later particularly the top ALT counts (in which the market has not peaked yet)






Thursday, January 28, 2021

Elliott Wave Intraday/Update ~ 28 January 2021

Update:

MARKET COMMENTARY (hedge fund rant edition)

With call options at record-er highs (this was yesterday) and being so one-sided, the market's leverage is insane. This is what causes the delta/gamma explosions. And the gamma explosions are being fed along with all resulting order flows, bought and paid for from frauds like Robinhood, into computers in amazing chunks of data which slice and dice and spoof it with multiple other trading house computers thereby creating the mega-volumes you are seeing on the daily prints.  Oh yeah, and shaving .0032 off your stock order and pocketing it millions of times over every day.

The speed of the processing flow is incredible, and with the physicality of the machines very close to where they need to be to get all the bandwidth, they can get an edge.  If my computer is 1/4 mile closer to the optimal market electrical intersection, my computer wins. That's how fast they got these things working. 

The algorithms, are somewhat self-learning. The kids college wizards who programmed them have an idea what they are going to do and how they are supposed to behave but when the outer limits of the possible are pushed too hard, they will likely experience melt-downs. The 2010 "flash crash" comes to mind. This was in the relative infancy of (High Frequency Trading) computers handling the bulk of the trading duties and it glitched hard.  There have been other flash crashes since. They are all warnings.

It all gives the illusion of mega-real "liquidity". And volume is heavy that is no doubt. But in reality, there is a lack of real liquidity - not for these prices. As I mentioned last night, there are derivatives upon derivatives on everything traded and then some. There are more ETFs than there are underlying issues to cover them. 

The ETFs are inherently dangerous also.  "Borrowed" and then "created" equities that are "lent" over and over creates a nasty chain of ownership that works when things are smooth, but break the chain somewhere and they can outright fail and have a domino effect. Though they usually work as intended, if volatility goes too high, they can be death machines. And you can be on the hook for negative losses as a result. Oh yes, read the fine print. If the ETF winds up super "glitched" you are on the hook for making up not only the principle that you may lose but any leveraged loss as a result of market moves.

So what we have is basically a sham of a market, an illusion of real wealth and real prices.  And sure, there are still plenty of real people doing order flows and trading but not for someone like you and me. We place our bet, I mean "buy" into our trading platform and poof! off it goes into the maze of machines to get crunched.  And hey, I got my stock order bet for 19.0234 cents! (Yay?  Hey, where did the extra 2 digits come from? Oh well!) Its all so efficient and money-making. Until it's not. All that leverage works in reverse also. 

The hedge funds guys are more or less sociopathic-type personalities. Not all of them, but you don't get to be a hedge fund guy by being Mr. Nice Guy. These guys actually like seeing themselves on the big screen portrayed as cunning raiders! They get a kick out of it. To them "The Big Short" and "The Wolves of Wall Street" is a badge of honor.

So we head into a major COVID recession and what happens?  The economy is falling apart and it really isn't getting back anywhere near where it was, that much is obvious. So what do the guys on Wall Street do? They all want to star in the next "Big Short" movie and they lazily short things like airlines, cruise ships, restaurants, mall REITS (MAC), and any other thing that is suffering economically. Its just wrong of course because these aren't fraudulent businesses like Enron or Wirecard, this is our economy.

And they think its going to be an easy bag. And then they short one stock over 100% and then up to 140% of the float which means naked shorting which is of course supposed to be illegal. And what stock did they pick for this? Gamestop of course. But why? I tend to think its because the hedge fund guys are no good at Call of Duty and get creamed every time they try to compete. Or maybe they loathe going into the actual store and having to wait in line with Millennials they view with utter contempt.

Maybe its just that they seen an opportunity to make Millennials suffer by trying to bankrupt the very thing most Millennials love: Gaming.  Whatever the reason, why is there a mega float short on a $20 stock from a company that actually was doing not so bad and getting along. Why? 

If the reports are true in that the hedge funds are in the hole to the tune of tens of billions on a myriad of normal companies needed for a normal economy....why? These are real businesses just trying to survive COVID and you Wall Street assholes have to short most of the float and/or naked shorting?  When the market has been going up steadily since March??

You need a bailout at a MARKET PEAK?? Are you f****** crazy?

There should be rightly no sympathy for any of them. Retail used the leverage in reverse and caused these lazy hedge fund bums to cry "uncle". But no, they will try to rig the game, change the rules and whine to the SEC about "foreign interference" or some bullshit like that. They deserve to lose their shirts, their jobs, their livelihoods. In fact, they deserve jail time if they have broken any laws which of course many likely did. Who called the brokerage houses in a coordinated takedown of a list of stocks not to be bought and the corresponding options trading limited in them? (This is what they really needed to nuke was the options driving the gamma - and that will likely remain limited).

Well, you lazy guys aren't so bright.  By providing the exact list of stocks to be banned everyone now knows which ones are right over the target. And you have no sympathy from any normal American of all political stripes. You have managed to unite quite a few people who just a few weeks ago thought impossible. We haven't forgot the 2009 crash and all the bullshit that went on there. We are well aware no one went to jail. Do not extrapolate that trend into the future, it's bound to change. The coming negative social mood storm almost guarantees it.

And its a medical pandemic no less with 400,000 people dead and tens of millions out of work and you had the balls to get your CNBC and Marketwatch lackeys to actually whine and cry and take your side?

I repeat: YOU NEED A BAILOUT AT A MARKET PEAK???? 

Are you begging for another Occupy Wall Street this time with the entire political spectrum protesting in unity?

I leave this rant with some ponderings. If there are some 10's of billions of losses about to be recorded in the next week or so (starting tomorrow) from greedy hedge funds, they are likely to try and go scorched earth on the entire market.  Because they just don't fucking care. That much is obvious.

CPCE. 

Ho hum, just another .40 print. Very tight grouping of the moving averages. Wilshire record volume print today again (see chart down further below)

The skew on Comp:100 getting horrible again.
US Ten year count. Probably wave 2 in progress.

COUNTS AND CHARTS AND STUFF

This is one of those moments in time when you can throw up the same chart and come out with diametrically opposite outcomes.  On the Wilshire 5000, we have a definitive peak and we have a solid 5 small wave structure down from that peak. 

It is possible the 5 waves is the beginning of a big downturn and today was wave (ii) up. Tomorrow or latest Monday wave (iii) down would get going in earnest. I sort of favor this count because of the record heavy volume candle yesterday and I suspect tomorrow will not be much different. However, we need a lower low beneath yesterday's low to make this stick.

And thus the daily would count as thus:
And look at the monthly record volume with 1 trading day left. Every time it tries to mega-poke through the Bollinger band lines, it has a hard time.

Are you enraged yet?

"We blatantly kicked you out of the counting room and boarded up the windows sold your shares in your own best interest. Oh and eat shit, you deplorables are not allowed to have a say we gave you about the shittiest deal today we could find."

Maybe we are all on the same team? (found via ZH)


The opposite count has that small 5 waves as wave (c) of [iv] in an expanded wave [iv] flat count. Today's rebound would be a small wave (i) of [v] up.  Well, heck, if the "top" is not in, we have to have a count for it yes? The one below would likely fit the bill.


INTRADAY COUNTS AND STUFF

Ok, GSE took a big pullback, but really it may have only been a "gap cover". I was half expecting that to happen.  Have any shorts actually covered?

Everyone assumes "it is over", but this one doesn't fit your typical squeeze rally scenario. And there are multiple stocks involved. And there is a ton of enraged and pissed off people throughout the entire political spectrum on this issue. 

If its only wave 1....

I mean did every short cover yet?  (no) Can they keep a lid on this thing without a revolt occurring?


COMMENTARY

Well, well, well, we have obvious manipulation by the "elites" to screw over "the people", this time over trying to make a buck trading stocks. And many are rightly enraged. Yet well, fuck most of you. You fucking cheered them on when it was obvious that Trump was crushing Biden on election night and it took massive blatant "manipulation" and fraud in 6 key swings states to pull off the election. Somehow it was only those states that needed 4 more fucking days to "count" (as compared to Ohio and Florida wrapping up on election night) to screw over "the people" in a clearly stolen election.

And now your "shocked" on how they can openly just do what they just did by stopping the selling buying of their precious short stocks??

I cry a river.  

LOL, think suing them will help?? LOLOLOLOL guess you should get used to this:

"You have no standing, your suit is dismissed, we don't need to hear the evidence."

And then get used to this:

"I was banned from Twatter because I objected to Wall Street tactics."

LOL!

But I will sympathize with you if you can somehow manage to twist your brain around to my point of view and admit the obvious: The system is RIGGED against all of us. Trump was an outsider and I doubt you would be stopped in your trading today if he were still President. As proof? Trump Jr. has come out in clear support of "the people", along with...AOC. See how that works? As I have been suggesting "we the people" have more in common than you think and they want to banish those who try to upset the rigged system. Trump was upsetting the system. Many of you Redditers campaigned for him to be gone.

Well you got your wish. But hag queen Nancy, nor the sociopaths on Wall Street don't like you either.  Why do you think they picked Gamestop to be destroyed? Because they literally hate you. They hate you going in there and buying games and fucking off all day while they are in their golden ivory towers working hard on screwing people over. They not only had no respect for you, they wanted to destroy the things you like to do. Get used to it, many of you voted for this.

Way to go, Uniparty! You managed to piss off just about everyone now. 

And oh, its not about race, it won't be about race. Its always been about wealth inequality. Its always been about CLASS WARFARE. And that unites more people against the system than you can imagine. You will see.

OWS

I'll be back with more charts and stuff.



Wednesday, January 27, 2021

Elliott Wave Update ~ 27 January 2021

Update:

They are back. Tomorrow should be a wild ride

Most Shorted Names Soar After WallStreetBets Reopens | ZeroHedge

Update:

The "Elites" are determined to crush all opposition and any perceived threat, real or imagined to their raw thirst for power. Those on the Right and those on the Left. And of course all those in between too if it comes to that. There really is more in common between those who are banned than people think. 

r/WallStreetBets has been banned. And then went private? And vow revenge.

What is funny is that they can damage everything in reverse too. Do you know there are more ETFs and derivative vehicles than the underlying stocks and bonds themselves? The market is insanely leveraged and has been structured in such a way that makes it extremely dangerous.  This overleveraged behemoth of a "free market" will come back to haunt the elites.

The dominance of HFT machines sucking sub pennies out of everyone and anything will come back to haunt them. 

The use of "front running" flow orders of "little people" Robinhood traders such as those on WallStreetBets will come back to haunt them.

The years of "wisdom" of selling the idea that "pro" fund managers can do a great job and produce wealth will come back to haunt them.  The "pros" are now passive managers too. They ain't doing anything except buying an index fund. A weekly injection of borrowed crap.

And having "hedge funds" dominate the market as they did in the collapse of 2007-2009 will come back to haunt them.

LOL what if the subredditers WSB learn how to short the hedge funds, banks, and other targets en masse? After all, there are vehicles to do this. ETFs, options, and direct shorting. What if the front-run flow orders are all sell, sell, sell? The HFT machines will have no choice but to spoof the market lower.

Ah. don't count out the "little guys". Remember it is the meek who shall inherit the earth.

And oh yeah, look at that volume action on the composite? See the volume ratios? The market is broken. It won't take much to topple it over, there is simply too much rot underneath.

Of course the HFT machines and all the computers trading to each other has produced this madness of a one-sided option market which has produced the gamma causing the market to go parabolic.  When the elites are now "punishing" the little guys for daring to participate in the very thing the elites constructed themselves....well...I can only suggest that things will work going the other way also.

Biden doesn't care about the stock market. Indeed, I don't think he is aware of much of anything lately. Actually since Trump was FOR the stock market, you can bet the new regime will be AGAINST. They don't care if it drops 15,000 DOW. If it means the "little people" get crushed in the process, all the better.

Update:

Having a chance to look at today's carnage, here is a potential "top" count of the Wilshire. Record volume day. That is a bearish development considering its a day after a "peak". And the little wedge at the top may say it all. All in all, a very satisfying structure.  I won't be disappointed if the market goes no higher, my upper 42,441-42,485 was looking ok (who knows) but it really was just a mental exercise trying to keep a handle on this juggernaut of a market.  But there has been some technical damage inflicted and we have a small impulse lower. 

Simply put, we had to be mentally ready for further upside (and we haven't broken any pivots just yet....) 

However, 

We also have to be mentally ready for what I have been predicting all along: A complete collapse of the entire market and the beginning of true price discovery across the entire spectrum.

Maybe we get a two-fer! Continued short squeeze drama in the most shorted stocks and a total market collapse! Won't that drive the elites absolute bat shit crazy??? Hey, it happened today as the DJIA finished a tidy -633 and no one bailed on the shorted stocks....

ORIGINAL POST

LOL! LOL! LOL!

I never had a funner day watching the stock market! From pre-market amazement looking at Gamestop's mega-squeeze, to the afternoon announcement that the Biden administration and the abominable Yellen were "monitoring" the situation with Gamestop and the markets.  In between you can tell there was a whole lot of panic by the "big boys" and you could read between the lines and see the libtards at Marketwatch getting madder and madder as the day went on at the thought of deplorable Redditers wiping out Wall Street hedge funds. It was almost as if Trump himself was forcing the squeeze such was the reaction. (LOL! He is permanently in their heads!)

Premarket, GME was trading above $300. AMC was exploding.  And then futures started sliding. Since the Fed cannot directly bail out hedge funds (or Citadel - at least not openly just yet), the best they can do is (hypothetically) sell futures and put a damper on the entire market thereby snuffing out the squeezes.  Of course the idea is to sink everything to stop the squeeze bleeding. But it didn't work, at least not today. As the DJIA plunged 500+ points GME was rock-solid above $300 and AMC held up. 

And a bunch others. 

In fact the stock  - MAC - I pointed out last night (I found the short list from ZH, I have to give them credit) traded above $26 before going red and then after TD Ameritrade announced they were limiting GME and AMC trading, MAC took off again and finished the day higher. And it cleared long term resistance on record volume.

Will the SEC have to step in and ban trading in the list Zero Hedge provided on Friday to stop the bleeding?

After a very negative market open, you could see the stories come out on Marketwatch how "sad" it all was and that people were going to get hurt and its "market manipulation" by the Redditers or something. The comments in the articles said it all. Stick it to the man!

And you had comments from SEC and other "authorities" on how this could all be illegal and market manipulation. 

Well none of that worked. So TD Ameritrade, (on who's orders?) decided to "restrict" trading in GME and AMC. But they still traded high and other shorted stocks were quietly exploding also.  And of course the announcement of the Biden administration. They really hate the little guys don't they? Like I said, the reaction from the usual libtard suspects' made it seem like Trump himself was behind it all! 

LOL (it is funny, but yet it accurately reflects the sentiment of the people):


So now what? I knew the trade was heavily exposed when a lady of some older years asked me today "what is a short squeeze?" - she had heard it on the radio. Even VOX came out and did some 'splaining on the squeezin'.

Think its over? LOL! I hope not, its just too entertaining and the hedge funds have (and get) NO sympathy at all - not from the right, nor left! Will they (attempt) to plunge the markets to "rescue" Citadel and others from a few more billions in losses and get the real bear wave (c) rolling? Do they know what they are doing? LOL!

(hey don't they have to cover the short selling of overnight e-minis at some point??)

THE COUNTS

This chart sums it up pretty much. We either are approaching a wave [iv] low (or it is now "in"), or we had a market peak and today was the first impulse lower. We shall see.

I'll have more. Either tack on some charts or up top with more commentary.

Wilshire weekly. It may be over. A solid rejection from the upper  channel line.


Tuesday, January 26, 2021

Elliott Wave Update ~ 26 January 2021

UPDATE:

The best I can do with the DJIA count is that it too is on its last wave [v]. So at least that matches with the Wilshire in that regard.

UPDATE: 

Some thoughts;

Again, the exploding of the most shorted stocks is likely the final phase of this crazy market. At least it fits nicely into my primary count if the Wilshire can manage to move to the 42,441 - 42,485 range as suggested. This is less than 4% from today's close.  Going back to the Zero Hedge article I linked last night, it is remarkable that Citadel, the behemoth trading hedge fund giant, has bailed out a hedge fund by the tune of almost $3B (at a market peak no less - let THAT sink in). And if things keep getting squirrely, will it be enough? What other domino's are out there?

And what about Citadel itself? Who would have to bail their "investments" out? The NY Fed? How would that happen? Well, being that the NY Fed desk is the biggest behemoth in the final scheme of things, they would have to actively try and crush the market and stop the pain of hedge funds blowing up and market makers blowing up also. 

Ok, so suppose the NY Fed is forced sometime in the not-too-distant future of putting their weight on the scale (perhaps at 42,450 Wilshire no less!) in such a negative manner that their intention is to crush the market (crush the Robinhooders), at least for a bit and try and stop the feedback loops. If this were to happen, it would imply market makers are hurting, hedge fund behemoths are hurting, and the crazy market needs a breather. Lets suppose a cascade happens and then a negative gamma feedback loop occurs?  Who would be left short the market to soften the blow on the way down?

Not the hedge funds as they would have been all blown out. Not the market makers as the gamma feedback loops will chip away at their margins in reverse. Robinhooders? No, they'll be busy trying to  catch a falling knife and get caught en masse finally on the wrong side of the trade. Mom and Pop and run-of-the-mill fund guys regular passive investing? Nope, their clockwork "injections" into 401k's and such will simply be averaging down as the market falls.

What shorts would be left in the market?  Who will stop the vacuum collapse when the HFT algo's start reading headlines and spoof to the downside because they don't know any better?  And if they spoof too hard to the downside wouldn't the human emotional reaction would be to just "unplug" them? 

How would price discovery work when the algorithms, which have dominated the markets for the past 5 years, no longer function and unable to mask the fake volume of computers trading to each other?  Can humans even handle this market all on their own adequately?

Will Mortimer come running down to the stock market floor in a panic?

Where will the liquidity be then?? And if the market "flash crashes" maybe "mom and Pop" will get the hint and finally find their selling points (don't count on it, they are just as greedy as the hedge fund manager). I'll tell you who WILL find their selling points very quickly; the uber rich. And their big money can help move markets - in this case to a cascading downside avalanche.

CONCLUSION:    The market has entered an extremely dangerous phase. Its a fitting ending really. The computers algorithms got us here and will, not ironically, be the downfall of this market. 

We have truly reached the "ALL IN" moment. God help us. Hang on for the ride.

Just who is actually hedging this market properly at all? No one by the looks of the CPCE.  This is proof, that we are well-entrenched into the "all in" stage. That's why I keep showing it.




UPDATE:

LOL!


ORIGINAL POST

It appears the blowoff stage to the madness which is the (B) wave peak is here.  As Zero Hedge has been pointing out the most shorted stocks are getting monkey-hammered upwards in price. Hedge funds are under pressure from the Robinhooders who are providing the order flow which in turn is being amplified by the HFT machines, etc.. and making market moves particularly in single stocks. Gamestop again (as was suggested here last night) exploded higher as Robinhooders are piling in creating a gamma feedback loop (which I really don't completely grasp in its entirety) but Zero Hedge has a nice primer if your interested.

I had some time today and was poking around at some heavily shorted stocks and came across MAC ( I think I seen this in a Zero Hedge list but can't find that post or list).  These guys actually still have a positive earnings per share ratio. Why is the stock so shorted at this stage? Yes, I know, the "smart" money says malls are going bust (and they will), but maybe you might want to wait until the overall market peaks prior to getting a mega short hard on? 


And their chart is at long term resistance. Should it clear that hurdle, it too might create its own gamma feedback loop. Very volatile trading last few days.  This is just one example and I could post a lot more but you get the picture. 

THE COUNTS

Last night I explained that a strong Fibonacci  ratio relationship exists at 2 large degrees. The Wilshire range is 42,441 - 42,485.  In addition to explaining that range there is another smaller potential Fibonacci relationship that falls in the middle of the range.

Wave [v] of C = .618 * wave [iii] of C @ 42,458

(I derived this using midpoint of its orthodox [iii] peak and its (b) of [iv] peak) 

Thus the tiny squiggles would look like this:
And the daily:
But we are certainly keeping our eyes on our other counts. But until key levels break under, these are just counts. The next best count is that we are in an ending diagonal triangle with another marginal high to come. This one is labeled as [v] of 5 of (5) - which again, is acceptable - along with the false social mood irregular (B) wave top.




Monday, January 25, 2021

Elliott Wave Update ~ 25 January 2021

(Fixed most of my spelling and most of the grammar - when I get in a hurry, I type as bad on my blog as I do my phone)

Wow, the price action is insane. If you have been following Zero Hedge's posts about how the most shorted stocks have been shooting higher in amazing short squeezes, then the market has probably entered the fabled "blowoff top" phase that everyone always likes to throw out there as if it was ever a real thing.

Well, it appears it may very well be a real thing, so we'll see if it has some legs. I have several counts but I'll be honest I'm looking at the most bullish short term count as perhaps the top one as a result of this morning's price action. Are there more hedge funds about to get crushed?

(Note: at those prices the squiggles would be relabeled a bit - as wave [iii] cannot be shortest) So the reworked squiggle would probably resemble this giving us some alternation between matching subwaves:
And thus, the reworked squiggles work very well because now at least waves (iv) and [iv] alternate in form from (ii) and [ii]

The reason I point to this count now is that there exists a powerful dual Fibonacci relationship at higher prices.

The range is 42,441 - 42,485 a fairly tight window for two Fibonacci relationships:

(B) = 1.618 * (A) @ 42,441

Within (B), C = .618 * A @ 42,485

Ok, well now that I have "pinched" myself maybe back to reality, I have 2 more counts.

The second count is the market is in some kind of ending diagonal because of today's overlap.

The last best count is that the market peaked and you saw a final spasm today with the ridiculous short squeezes....

Tesla made a new high which was required but not sure if its the top.

Yeah, Gamestop. I could show you 8 - 10 other junk stocks that look the same.  Volkswagen all over again? You know the Robinhooders ain't gonna stop trying to squeeze which means the HFT machines are front-running spoofing , I mean "bidding" things higher. 

Remember, in this low liquidity market, the active players are getting "amplified" by the algorithms.  So yes, Robinhooders can affect the market when there is yet to be serious selling. You've seen that today an instant "vacuum" downward occurred for why? Because when the machines glitch or their algo's get confused they can certainly amplify things in a negative way also.

Ok question, who here thinks since the infamous (2011?) "flash crash" (blamed on a "fat finger" of course) that the market has gotten more secure? Of course not! You've seen the carnage just last year! Nothing is fixed, conditions are worse!
  











Saturday, January 23, 2021

Elliott Wave Weekend Charts - (B) Wave Edition

I went and made a more detailed proposed fake top (B) wave. Basically the subwaves take my original 5 wave count to the September 2020 peak and labels that September high wave A. Then we had a few months of correction forming wave B (a regular 3-3-5 flat). And since the election proposed wave C of (B) has been tracing out.

This proposed wave (B) is part of proposed Primary wave [A] of Cycle wave a of Supercycle wave (A). In other words, the "correction" to a Fibonacci 233 rise in social mood has just begun.  But this correction actually stated last March and we are reaching the middle "three" waves in a proposed 3-3-5 expanded flat count. This would account for the still deteriorating social mood decline since February 2020.

We likely won't be alive when the Grand Supercycle wave [IV]'s correction is finally over. It should last decades.

Here is the proposed count:

Recall my primary count in September has us in 5 waves up (which is why I thought it was the top).

If you search the history of this blog, when the 2009 low occurred, the preferred count was that it was only Primary wave [1] of [5] of a cycle wave c expanded flat count. That lengthy Cycle wave c simply never came. "P3" never happened. I had been using Robert Prechter's count that the 2007 high was an  "irregular" top. It made a lot of sense at the time and it certainly seemed like the bottom was going to fall out and the financial system collapse. But it wasn't to be and we have endured quite a runup since then fueled on incredible amounts of debt.

Of course the 2007 high does count best as a (B) or [B] wave (depending on degree you want to use) in a 3-3-5 flat count.  However it was pretty much just a regular flat or slightly expanded.
So now we have reached yet another situation where the first subwave "corrective" of Grand Supercycle wave [IV] could be possibly a "false top" irregular (B) wave - or [B] if you want to use the next higher degree. Mr. Prechter does not consider this a false (B) top at all as he had back in 2007 but I am almost convinced it probably is. I'll detail my reasons:

1. Waves are about the underlying social mood. Can you remember back in January 2020 what you felt like? Was much more calm and peaceful. No riots, no COVID lockdowns, and a very low VIX. In fact Elliott Wave International had a solid count pointing to that February top as the GS III top.  More or less so did I (but I was thinking a small wave 4 and then 5 were coming which never did).

2. This "new" top now seems false in every sense of the way.  Fueled by speculation and yet even more debt, the VIX is still above 20, there is fear, and real anger throughout entire populations. This just doesn't "feel" like a kumbaya moment in time.  An election was stolen in broad daylight and now civil liberties are about to be extremely curtailed. The politicians are scared of the population by deploying troops to the Capitol city and then questioning if they can be trusted! Does this fit the profile of an orthodox peak? There is a rapidly senile "President" in place and his Inauguration was so embarrassing no one showed up (no one would have showed up even if their wasn't 25K troops locking it down).  Its like we are living a "Hunger Games" movie in that we are the districts expected to produce and enrich the Capitol City in perpetuality. Again, is this a real top in social mood?

3. The mood has changed drastically since just less than 1 year ago. Yet the stock market has screamed higher, fueled by light volume Robinhooders amplified by HFT computer algorithms front-running them and the largest ever percentage of "passive" investing injections into the stock market which are largely injections of debt in reality.  Your 401K match wasn't "earnings" it is debt fueled by insanely record amounts of Corporate borrowing. You're getting richer but only if you sell high. Most will not (except the Insiders who are selling like crazy!)

4. Unemployment was extremely low last February. Highways were packed at rush hour all over the country. Today? Still gargantuan amounts of weekly unemployment claims, criminally insane COVID lockdowns, and now the "cult of the mask" has seemingly become permanent. Is this a true social mood peak?

I could go on and on but you get what I am saying. 

THE IMPORTANCE OF NOT OVERLOOKING AN EXPANDED FLAT FALSE TOP.
The main reason is in an expanded flat, wave (B) goes higher than wave (A) and wave (C) is going to go much lower than Wave (A) low.  The "max" this (B) wave would expand is probably about 1.5 times the length of the price drop of wave (A).  In the Wilshire, we have reached 1.4975 x (A) @ 40,915. About 31 points shy of a perfect 1.5 multiple.  

But again, if this is wave (B), wave (C) should follow in a very sharp manner (just like 2007-2009 was a nasty 5 waves down forming (C)).  In other words, we already have identified 2 of the 3 pieces of the first corrective. So we shouldn't ignore that (C) could come and blow this market away. 

The target for (C) is a Fibonacci 1.38 x length of wave (B) - a guess - which is roughly 14,980 - or the support provided by the Wilshire 2000 and 2007 peaks (see charts above). This is a guess but timing for a major 20 year cycle low is in 2022. This implies that this collapse will dwarf the 2007-2009 collapse in total price, speed and %.  Be ready!