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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!







Friday, January 22, 2021

Elliott Wave Intraday/Update 22 January 2021

UPDATE: Perhaps a small pop Monday? Ok yes, I admit, social mood commentary has now thoroughly blended within the squiggle counts, hey, its Friday I'm feeling it. But yo, Antifa, you are not enemies and we have more in common than you think, but you have to stop the anarchy!

Yet I know Antifa wishes a collapse of the financial markets and many of them that read my site are hoping for just that "prophecy". They want to tear the system down for its own sake. I don't.

However, the social mood collapse that you are egging on will result in things that will not be in your favor at all. It will be good for no one. That is the lesson of WWII. Who benefitted from that? No one! Sure, the cynical will say the United States, but  tell that to the hundreds of thousands that suffered dead relatives. No one benefitted and neither will it be the same in any collapse in social mood to come.

SO LET ME BE CLEAR: I DO NOT WISH ANY DESTRUCTION THAT MAY OR MAY NOT COME AS A RESULT OF COLLAPSING SOCIAL MOOD, AND I DO NOT CONDONE ANYONE WHO WISHES SAID DESTRUCTION.

My purpose in this blog is to WARN, because almost 100% will think this is all foolish to believe in "social mood wave cycles" anyway.  Yet if we realize that the cycles of sin is what is driving us to potential madness, then that is all I can do. I am saying you may be feeling hate because the mood cycle is driving you to do so. Do not give in to negative mood! Resist and let it pass with peace!

For it will pass. Yet we must gird ourselves for the coming storm. And we will not be helpless targets for those who wish evil. 

COUNTS

One potential count:

Another squiggle variation which suggest its "over".
UPDATE: I can't figure it out, should they be social distancing after they have been sent to a garage or do the Democrats not really "care about the troops?"

Are they trying to infect these people on purpose?  Were they used for "optics"? Yes it appears so on both accounts. Fuck you Biden and Harris and all you asshole Uniparty that lets this happen.

From the great Ace Of Spades, this is spot on:

Bullies will intensify their bullying until you break their fucking noses.

Buh Muh Private Corporations

Make your own internet, your own banks, your own credit card transaction services, your own web server complexes, and your own publishers and media.

Oh, and if you do: We'll activate our Cartel Members to strangle them in the crib.

I guess what they're really saying is "Make your own country."


UPDATE:

Ok dare me to be wrong here Mr. Market.  Lining up for the obligatory "Monday morning pop".

SOCIAL MOOD COMMENTARY

There will be a new political party. Social mood theory actually predicts this.  In a Grand Supercycle negative social mood event, this is actually the theory, not a speculation. A negative mood environment such as this predicts that society will fracture into sub-groups. Some call it tribalism, some call it feudalism. Both are from the Middle Ages and/or from a much prior period in time. 

We are only at the tip of the iceberg because the mood has not yet completely "turned" negative.  There is still a shred of positive mood in the "false mood" (B) wave peak which may or may not have ended.  Or you can call it 5 of (5) of [5] of (V) of (III) if you want. They both speak the same thing: Mood is turning and because it's at a Grand Supercycle degree, it will be brutal. 

But turn it will. The last of American's patience has run out no matter the political stripe. I do not couch these coming "battles" in terms of left vs. right but in evil vs. good.  There are those who want literal blood on 1/2 half of the country and it is not the Christian half that wants this.

The Christian half of society or those that were raised by Christian beliefs and have sympathy for humans will be shocked in horror of the things society is capable of. Already you have people like that fucking asstwat Baldwin who dreams of hanging Trump. And of course that certainly implies dreaming of hanging 75 million Trump supporters.

This is the sickness of a social mood turning point. This is a "false social mood wave" in every sense and it cannot go on forever, it will end very badly. That Twitter allows this to remain up and does not ban says everything you need to know. They wish you and I were literally dead, and they will cheer on those who carry it out.

The Uniparty is running scared in DC. They have no idea what they are supposed to be "about". Biden's Inauguration was so empty it was telling. Oh they cooked up the idea that "right wing extremism" was so bad they had to shut down the city but you know its bullshit. They couldn't get 6 people to show up for a Biden rally and Harris got ZERO delegates in the democratic nomination process. Its beyond a joke, its like '1984', but guess what? We are not a bunch of Winston's and this is not the "Hunger Games". (edit; sorry for the bad language)

They are scared. They are very scared because the amount of fraud to get them elected has now clearly passed the "plausibility" litmus test.  We have entered the "Venezuelan Model", yet we are not Venezuelans relegated to "take it up the ass and deal with it" just like all other 3rd world countries.

We are Americans. 

And we will resist the socialist takeover.  And economically, we are in for a total financial collapse, as this is all negative social mood with corresponding negative social mood results.

Alinsky's Rule #5: “Ridicule is man’s most potent weapon.”

Even Maduro had more people come to his "Inauguration".

The COUNTS:

We're close. Can it pop again? Sure why not. But its close. The whole shit-shebang is coming unglued and you can bet the "socialist" policy implementations like cancelling 50K union jobs on DAY 1 will have an accelerating affect of where we are really heading. Oh they'll get their wish,

Perhaps the best count even though there was a slight violation of (iv) overlap with (i). Just a reminder of how weak this is.


Thursday, January 21, 2021

Elliott Wave Update ~ 21 January 2021

The rot of this fake market is almost over. There are a couple of variations on how to count it.

Probably the top version is this:

And thus on the hourly:
Daily:
The next best variation is that a small pop to 40,946 tomorrow finishes it off. Again, this is where a proposed wave (B) is exactly 1.5 times the price length of wave (A). Wave (C) would then be 5 Minor waves down to form wave (C) of a Primary wave [A] expanded flat. 

In other words, this top is "false" and it will soon end.
And thus the corresponding version of the hourly:
If this is an expanded flat, there will be no stopping wave (C). 
And of course the count below is shown as 5 waves which also works nice. Both counts may in fact be "correct". The outcome is the same regardless.

There is no doubt the market is struggling with the upper channel line and perhaps is "feeling" the 1.5 times expansion ratio shown on the previous chart above.
Even Apple's minimum price level has been met. New high today.

Elliott Wave Intraday ~ 21 January 2021

Another possible count is that this is the final wave, (v) of [v]

And thus 40,946 would be about the stopping point. That is where the rise since March 2020 is 1.5 times the price drop to the March 2020 low from the Feb 2020 high.
 This squiggle count seems about right.
We are almost upon a strong potential wave relationship at 40,946. If this is a (B) wave which is as good a count as any, then 1.5 times (A) is about where the maximum price of (B) would be at.
Apple finally making another move off yet another triangle.
Update on wave (B) price relationship with (A).