All Star Market Timing

The Weekly JDV Market Timer - September 19, 2021

Folks,

Market Observations for the Week: The SPX declined on Friday’s quad-witching expiration and made a weekly close below its 50-dma. Real-time Dark Pool prints came in for the SPY late in the session and the SPY is below some massive Dark Pool prints which is bearish. How we trade into Monday/Tuesday's Full Moon Timing Window will be key to the short-term trend for the SPY – the Tuesday after a monthly option expiration is a turn window in our work. Our view is that the correction from 9/2 will take the shape of a highly volatile EW a-b-c correction into early October and we could see the Wave A low this week. We believe that cash needs to be raised to at least 70%, especially for those near retirement age. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX since June and the EW 5-wave decline on the hourly chart confirms that a significant top was made on 9/2 – the Fibonacci 34-day step out from 9/2 points to 10/6 as a potentially scary low. Now, on a much longer time scale, the Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall, and our bias is that the market highs are already in. We view the potential for a “black swan” event this fall to be quite high. The US bond market must be watched closely for signs of a reversal down – we may have seen a false break out in the TLT coil pattern.

9/19/21 (Commentary for Sunday) The SPX made a weekly close below its 50-dma on quad-witching Friday and the SPY closed below massive Dark Pool prints – this is bearish - how we trade into the Monday/Tuesday Full Moon Timing Window is key to the short-term trend. The SPX has rallied for a year without a 5% correction, but our bias is that we are in one now. The July/August SPX pullbacks into monthly option expiration week looked like “bull market corrections” but the current pullback into September monthly option expiration last week looks like the start of a long-needed correction. From September 2020 the SPX has rallied in a “Rising Wedge Pattern” and a “symmetry correction” from this long pattern could take us to 4166 for the initial (Wave A) leg down. The 34-day Fibonacci step out from the 9/2 high projects to 10/6 which could be a scary low. In the last four months, the SPX has declined into the monthly option expiration before rallying to higher highs so we could see a Wave A low into Tuesday/Wednesday before a B-Wave bounce. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72% on 8/27, the highest bullish sentiment in years. Bonds may have given us a false breakout from its coil pattern and a break down in bonds here could be “the black swan event” that triggers a stock selloff. However, the Chinese Evergrande bankruptcy risk is causing US bonds to rally overnight Sunday as Asian stock markets get hit. In the US, the background monetary conditions have been deteriorating for months - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and a possible end to the 12-yr bull market from 2009. Bitcoin plunged below its S2 support pivot Sunday night and tested 45,070 as the USD bounced to test 93.34. A rising USD is also pressuring gold overnight Sunday and it is testing its S1 support pivot at $1745. Gold, silver, crude oil  and bitcoin are falling into the 9/20-9/22 Full Moon Timing Window. The USD made highs for the week on Friday and is testing 93.34 overnight Sunday.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step out from 9/2 projects a potentially scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold plunged below $1750 and the GDX plunged below 30.69 which argues for more weakness in the PM sector into Monday/Tuesday’s Full Moon Timing Window.

• Stocks – The SPX made a weekly close below the 50-dma on Friday and the SPY remains below massive Dark Pool prints which is bearish. A SPY decline into Tuesday could see the end of Wave A down of a large EW a-b-c correction that could extend into early October. The Option Premium Ratio has trended sideways in the .40s/.50s for weeks – we should see this indicator spike to the .70s for the end of Wave A down.
• Gold – Gold is falling into the 9/20-9/22 Full Moon Timing Window – we are looking for a short -term low by the 9/22 Fed meeting and then a bounce with the SPX’s Wave B rally.
• Silver – Silver tested its S1 pivot support at $22 overnight Sunday before bouncing.  Silver undercut its 8/9 low while gold remains above for intermarket divergence.
• Bonds – Bonds are rallying Sunday night on the Chinese Evergrande bankruptcy risk that is causing Asian markets to sell off.
• Crude Oil – Crude oil is pulling back into the Full Moon Timing Window on 9/20-9/22.
• Dollar Index – The USD is testing 93.33 Sunday night as foreign currencies take a hit on the Evergrande bankruptcy risk being seen in Asian stock markets.

TURNING POINT DAY

The turn windows for this week is the 9/20-9/21 Full Moon Timing Window and the 9/22 Fed Day.

 

The Daily JDV Market Timer - September 16, 2021

Folks,

Market Observations for the Week: The SPY tested its 50-dma and went sideways into Thursday as a “wall of worry” appeared to be forming in the AAII investment survey which found only 23% bullish this week. The retail sales report came in stronger than expected and that supported stocks early. The energy stocks remained one of the strongest groups in the market as rallying crude oil and natural gas prices pump up the sector. How we trade into Monday’s Full Moon will be key to the short-term trend for the SPY. Our view is that the correction from 9/2 could take the shape of a highly volatile EW a-b-c correction into early October and that cash needs to be raised to at least 70%, especially for those near retirement age. On the other hand, some pundits believe that we’ve just had the 7^th successful test of the SPX 50-dma this year and will reverse quickly to new highs – how we trade through Monday will clarify the trend. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart confirms that a significant top was made on 9/2 – the Fibonacci 34-day step out from 9/2 points to 10/6 as a potentially scary low. Now, on a much longer time scale, the Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall, and our bias is that the market highs are already in - that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. We view the potential for a “black swan” event this fall to be quite high. The US bond market must be watched closely for signs of a reversal down – we may have seen a false break out in the TLT coil pattern.

9/16/21 (Commentary for Thursday) The SPX tested the 50-dma on Tuesday but we only traded sideways into Thursday – how we trade into the Monday Full Moon is key to the short-term trend. The SPX has rallied for a year without a 5% correction, but our bias is that we are in one now. From September 2020 the SPX has rallied in a “Rising Wedge Pattern” and a “symmetry correction” from this long pattern could take us to 4166 for the initial (Wave A) leg down. The 34-day Fibonacci step out from the 9/2 high projects to 10/6 which could be a scary low. In the last four months, the SPX has declined into the monthly option expiration before rallying to higher highs so we could see a Wave A low into Friday/Monday before a B-Wave bounce. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72% on 8/27, the highest bullish sentiment in years. Bonds may have given us a false breakout from its coil pattern and a break down in bonds here could be “the black swan event” that triggers a stock selloff. However, the background monetary conditions have been deteriorating for months - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and a possible end to the 12-yr bull market from 2009. Bitcoin is holding above its Person’s pivot at 47,719 overnight which is bullish. Once again, after Mars changed sign again, gold gave us a $50 decline that tested $1745 and the GDX gave us an undercut low below 30.69 which is bearish for more decline in the PM sector into the Monday Full Moon. The USD took out the high for the week and looks short-term bullish.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step out from 9/2 projects a potentially scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold plunged below $1750 and the GDX plunged below 30.69 which argues for more weakness in the PM sector into Monday’s Full Moon.

• Stocks – The SPY tested the 50-dma on Tuesday but could only trade sideways into Thursday – how we trade into Monday’s Full Moon will determine the short-term trend. A SPY decline into Friday/Monday could see the end of Wave A down of a large EW a-b-c correction that could extend into October.
• Gold – Once again, after Mars changed sign, gold plunged $50 to test $1745 and the GDX undercut 30.69 – we are looking for more weakness in the PM sector into Monday’s Full Moon.
• Silver – An undercut low to its S1 pivot support at $22.317 is possible for silver into Monday’s Full Moon.  
• Bonds – Bonds gave us a false breakout of its coil pattern and may reverse down – the strong retail sales number impacted bonds.
• Crude Oil – Crude oil is holding above its Person’s Pivot at $72.31 Tuesday evening which is bullish.
• Dollar Index – The USD is holding above its Person’s pivot at 92.76 overnight and looks short-term bullish.

TURNING POINT DAY

The turn window for this week is 9/16-9/17.

 

The Daily JDV Market Timer - September 15, 2021

Folks,

Market Observations for the Week: The SPX rallied today into the 13-day Fibonacci step out from 9/2 and it appears to be a high – the oil and gas stocks are leading here which is not the best market leadership. The SPY actually gave us a Positive Volume Reversal Day which cheered the bulls. How we trade into Monday’s Full Moon will be key to the short-term trend. Our view is that the correction from 9/2 could take the shape of a highly volatile EW a-b-c correction into early October and that cash needs to be raised to at least 70%, especially for those near retirement age. On the other hand, some pundits believe that we’ve just had the 7^th successful test of the SPX 50-dma this year and will reverse quickly to new highs – how we trade through Monday will enlighten us. The VIX made a multi-week high above 21 on Friday and its upper Bollinger Band is curling up which is bullish for more rally in volatility. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart confirms that a significant top was made on 9/2 – the Fibonacci 34-day step out from 9/2 points to 10/6 as a potentially scary low. Now, on a much longer time scale, the Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall, and our bias is that the market highs are already in - that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. We view the potential for a “black swan” event this fall to be quite high. The US bond market must be watched closely for signs of a reversal down.

9/15/21 (Commentary for Wednesday) The SPX rallied into the 13-day Fibonacci step out from the 9/2 high on the Wednesday before September monthly option expiration – how we trade into the Monday Full Moon is key to the short-term trend. The SPX has rallied for a year without a 5% correction, but our bias is that we are in one now. From September 2020 the SPX has rallied in a “Rising Wedge Pattern” and a “symmetry correction” from this long pattern could take us to 4166 for the initial (Wave A) leg down. The 34-day Fibonacci step out from the 9/2 high projects to 10/6 which could be a scary low. In the last four months, the SPX has declined into the monthly option expiration before rallying to higher highs so we could see a Wave A low into Friday/Monday before a B-Wave bounce. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72% on 8/27, the highest bullish sentiment in years. Bonds may be breaking out but must be watch for a quick reversal down. However, the background monetary conditions have been deteriorating for months - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and a possible end to the 12-yr bull market from 2009. Bitcoin is holding above its Person’s pivot at 48.505 overnight which is bullish. Gold is reversing down overnight to test $1780 but the GDX has shown relative strength. The gold chart looks bearish for a move to $1754 which would be a symmetry correction. The USD is holding above its Person’s pivot at 92.54 overnight and looks short-term bullish.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step out from 9/2 projects a potentially scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – A symmetry correction to $1754 by Monday’s Full Moon is possible and if the GDX can hold above 30.69 that could be a bullish signal for the PM sector.

• Stocks – Led by the energy sector, the SPX rallied into the close on the 13-day Fibonacci step out from the 9/2 high. The 34-day Fibonacci step out from the 9/2 high projects a potentially scary low on 10/6. A SPY decline into Friday/Monday could see the end of Wave A down of a large EW A-B-C correction that could extend into October.
• Gold – Gold looks ready to take out the “Running B-Wave” low at $1780 and pull back to $1754 by Monday’s Full Moon. The GDX is holding up against the gold weakness which is a bullish factor for the PM sector.
• Silver – Silver is rolling over Wednesday evening after Mars changed sign early on 9/15.  
• Bonds – Bonds appear to be breaking out higher but must be watched closely for signs of a reversal down.
• Crude Oil – Crude oil tested $73.14 and is making a run higher into Monday’s Full Moon. 
• Dollar Index – The USD is testing its R1 resistance level at 92.66 overnight and looks short-term bullish.

TURNING POINT DAY

The turn window for this week is 9/16-9/17.

 

The Daily JDV Market Timer - September 14, 2021

Folks,

Market Observations for the Week: The CPI report came in showing weaker inflation numbers than expected and the SPX opened strong once again only to give the gains up into the close – this is bearish action - we are tracking the first leg down (Wave A) of a correction from 9/2 and it could bottom into monthly option expiration on Friday. Our take is that the correction from 9/2 could develop into a wide-ranging EW a-b-c correction into early October and that cash needs to be raised to at least 70%. On the other hand, some pundits are just expecting the 7^th test of the SPX 50-dma this year and then a reversal up to make new highs – how we trade through Monday will enlighten us. The VIX made a multi-week high above 21 on Friday and its upper Bollinger Band is curling up which is bullish for more rally in volatility. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart confirms that a significant top was made on 9/2 – the Fibonacci 34-day step out from 9/2 points to 10/6 as a potentially scary low. Now, on a much longer time scale, the Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall, and our bias is that the market highs are already in - that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. We view the potential for a “black swan” event this fall to be quite high. The US bonds rallied on a weaker than expected CPI inflation report and may be breaking out.

9/14/21 (Commentary for Tuesday) The SPX initially rallied on a weaker than expected CPI inflation report but then sold off into the close which is bearish behavior. The SPX has rallied for a year without a 5% correction, but our bias is that we may be starting one now. From September 2020 the SPX has rallied in a “Rising Wedge Pattern” and a “symmetry correction” from this long pattern could take us to 4166 for the initial (Wave A) leg down. The 34-day Fibonacci step out from the 9/2 high projects to 10/6 which could be a scary low. In the last four months, the SPX has declined into the monthly option expiration before rallying to higher highs so we could see a Wave A low into Friday/Monday before a B-Wave bounce. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72% on 8/27, the highest bullish sentiment in years. Bonds rallied on the weaker CPI inflation report today and could be breaking out. However, the background monetary conditions have been deteriorating for months - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and a possible end to the 12-yr bull market from 2009. After making a multi-week low on Monday, bitcoin rallied to test its R1 resistance pivot at 47,535 Tuesday night. Gold gave us a multi-week low at $1780 right after the CPI report and then rallied $30 to test $1810.6 before correcting– the chart looks bearish for a move to $1754 which would be a symmetry correction. After the CPI report, the USD made tested lows for the week at 92.33 before rebounding into the close.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step out from 9/2 projects a potentially scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold spiked down to a new low for the week at $1780 after the weaker than expected CPI report but then rallied back $30. A symmetry correction to $1754 by Monday’s Full Moon is possible and if the GDX can hold above 30.69 that could be a bullish signal for the PM sector.

• Stocks – After a weaker than expected CPI inflation report, the SPX gave us an early rally that was reversed down into the close. The 34-day Fibonacci step out from the 9/2 high projects a potentially scary low on 10/6. A SPY decline into Friday could see the end of Wave A down of a large EW A-B-C correction that could extend into October.
• Gold – Gold may have traced out a “Running B-Wave” low at $1780 before rallying $30 – this pattern would argue for a break below $1780 in the next few days.
• Silver – Silver appears to be rolling over Tuesday evening after a weaker than expected CPI inflation report.  
• Bonds – Bonds rallied sharply after a weaker than expected CPI report and are breaking out of a coil pattern.
• Crude Oil – Crude oil is holding above its Person’s Pivot at $70.98 Tuesday evening which is bullish.
• Dollar Index – The USD fell to 92.32 after the CPI report and tested Friday’s low.

TURNING POINT DAY

The turn window for this week is 9/16-9/17.

 

The Daily JDV Market Timer - September 13, 2021

Folks,

Market Observations for the Week: The SPX made a lower low Monday but ended strong to end a 5-day losing string. The CPI report early Tuesday will set the tone for the week. Many analysts are looking for just another pullback to test the 50-dma before reversing higher to new highs. Our bias is different – we are bracing for a significant correction into early October and believe that the yearly highs are in and possibly for the 12-year bull market from March 2009. The VIX made a multi-week high above 21 on Friday and its upper Bollinger Band is curling up which is bullish for more rally. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart confirms that a significant top was made on 9/2 – the Fibonacci 34-day step out from 9/2 points to 10/6 as a potentially scary low. Now, on a much longer time scale, the Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall, and our bias is that the market highs are already in - that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. Giving up potential market gains in the seasonally weakest time of the year is a good trade off considering the potential risk for a “black swan” event this fall. The US bond market is the key market to watch now – a break out in the 10-yr US rate could develop here and pressure the SPX into a quick 5-8% correction in the near term. A break below TLT 147 would confirm that the short-term trend in bonds has turned bearish.

9/13/21 (Commentary for Monday) The SPX made a divergent short-term high on 9/2 and the NDX made a divergent high on 9/7 which overlaps with the 3-star 9/3-9/6 geo-cosmic turn window – the SPX gave us an EW 5-waves down on the hourly chart to confirm a short-term high. The SPX has rallied for a year without a 5% correction, and our bias is that we may be starting one now. From September 2020 the SPX has rallied in a “Rising Wedge Pattern” and a “symmetry correction” from this long pattern could take us to 4166 for the initial (Wave A) leg down.  The 34-day Fibonacci step out from the 9/2 high projects to 10/6 which could be a scary low. In the last four months, the SPX has declined into the monthly option expiration before rallying to higher highs so we could see a Wave A low this week on Friday before a B-Wave bounce. The CPI report early Tuesday should set the tone for the week. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72% on 8/27, the highest bullish sentiment in years. Since we believe that long rates may have started a significant rally in the last week of August, our bias was to lighten up on technology stocks into the 9/6-9/7 New Moon Timing Window, especially in retirement accounts. In addition, the background monetary conditions are deteriorating - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and a possible end to the 12-yr bull market from 2009. Bitcoin is taking out the 9/7 mini-crash low at 43717 Monday evening and we view this as bearish for the global financial markets – bitcoin may be leading the SPX down. Gold gave us a wave 2 of C pop on Monday to test $1800 from below – the chart looks bearish for a move to $1754 which would be a symmetry correction. The USD touched 92.88 Monday and took out its high from last week.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step out from 9/2 projects a potentially scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold gave us an EW 5-waves down on the hourly chart to $1783 followed by just a 3-wave sideways correction – this is a bearish chart that points lower to $1754, a symmetry correction. Like gold, the GDX also gave us 5-waves down on the hourly chart which is bearish – gold stocks may need a macro catalyst like a 3-5% SPX correction before they can get a bid.

• Stocks – The SPY took out Friday’s low but rallied late to prevent five down days in a row – the CPI report early Tuesday will set the tone for the week. The 34-day Fibonacci step out from the 9/2 high projects a potentially scary low on 10/6. A SPY decline into Friday could see the end of Wave A down of a large EW A-B-C correction that could extend into October.
• Gold – Gold back tested $1800 in a possible Wave 2 of C down - a move down to test $1754 is likely this week and could mark an important low.
• Silver – The fundamentals for silver continue to improve as silver is becoming recognized as an important part of the EV economy.  
• Bonds – Bonds sold off on another stronger than expected PPI report early Friday – the CPI report early Tuesday could be another selling catalyst for bonds.
• Crude Oil – Crude oil is testing its R1 pivot resistance at $71.22 Monday evening.
• Dollar Index – The USD took out last week’s high and tested 92.89.

TURNING POINT DAY

The turn window for this week is 9/16-9/17.

The Weekly JDV Market Timer - September 12, 2021

Folks,

Market Observations for the Week: CAUTION: The SPX gave us an EW 5-waves down on the hourly chart last week and that confirmed a short-term SPX top on 9/2 close to our 3-star geo-cosmic turn window from 9/3-9/6. The SPX made its high on 9/2 while the NDX made its high on 9/7 – we are now bracing for a significant correction into early October – we believe that the yearly highs are in and possibly for the 12-year bull market from March 2009. The VIX made a multi-week high above 21 on Friday and its upper Bollinger Band is curling up which is bullish for more rally – the FEAR TRADE is on. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart confirms that a significant top was made on 9/2 – the Fibonacci 34-day step out from 9/2 points to 10/6 which should be a scary low. The Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall, and our bias is that the market highs are already in - that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. Giving up potential market gains in the seasonally weakest time of the year is a good trade off considering the portfolio risk at hand.  The US bond market is the key market to watch now – a break out in the 10-yr US rate is developing and could pressure the SPX into a quick 5-8% correction in the near term. A break below TLT 147 would confirm that the short-term trend in bonds has turned bearish.

9/12/21 (Commentary for Sunday) The SPX made a divergent short-term high on 9/2 and the NDX made a divergent high in the 9/6-9/7 New Moon Timing Window which overlaps with the 3-star 9/3-9/6 geo-cosmic turn window – the SPX gave us an EW 5-waves down on the hourly chart to confirm a short-term high om 9/2. The SPX has rallied for a year without a 5% correction, and we are due. From September 2020 the SPX has rallied in a “Rising Wedge Pattern” and a “symmetry correction” from this long pattern could take us to 4166 for the initial (Wave A) leg down.  The 34-day Fibonacci step out from the 9/2 high projects to 10/6 which could be a scary low. In the last four months, the SPX has declined into the monthly option expiration before rallying to higher highs, so we could see a low this week on Friday. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72% on 8/27, the highest bullish sentiment in years. Since we believe that long rates may have started a significant rally last week, our bias was to lighten up on technology stocks into the 9/6-9/7 New Moon Timing Window, especially in retirement accounts. In addition, the background monetary conditions are deteriorating - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and an end to the 12-yr bull market from 2009. Bitcoin gave us an EW 5-waves down to 43,705 last week before a sideways correction – a move below 43,705 would be bearish for the financial markets – bitcoin may be leading the SPX down. After testing $1837 on 9/3, gold traced out an EW 5-waves down on the hourly chart and then gave us just a 3-wave sideways correction – the chart looks bearish for a move to $1754 which would be a symmetry correction. The USD is testing its R2 pivot resistance at 92.77 Sunday evening – the USD looks like it wants to test last week’s high at 92.86 in a flat correction.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step out from 9/2 projects a scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold gave us an EW 5-waves down on the hourly chart to $1783 followed by just a 3-wave sideways correction – this is a bearish chart that points lower to $1754, a symmetry correction. Like gold, the GDX also gave us 5-waves down on the hourly chart which is bearish – gold stocks may need a macro catalyst like a 3-5% SPX correction before they can get a bid.

• Stocks – The SPY sold off hard into Friday’s close after a hotter than expected PPI number – Friday’s volume argues that we have entered a 3^rd wave down – the CPI report early Tuesday will be key. The 34-day Fibonacci step out from the 9/2 high projects a scary low on 10/6. We are holding a few Oct VIX calls for portfolio hedging.
• Gold – Gold traced out an EW 5-wave decline to $1783 and then just a 3-wave sideways bounce. A move back to test $1754 is likely this week.
• Silver – Silver tested its 50-dma last Tuesday and reversed down which is short-term bearish.
• Bonds – Bonds sold off on another stronger than expected PPI report early Friday – the CPI report early Tuesday is key.
• Crude Oil – Crude oil is rallying to test its R1 pivot resistance at  $70.55 which may be a B-Wave test of $70.61.
• Dollar Index – The USD looks like it wants to test last week’s high at 92.86.

TURNING POINT DAY

The turn window for this week is 9/17.

 

The Daily JDV Market Timer - September 9, 2021

Folks,

Market Observations for the Week: CAUTION: The SPX gave us an EW 5-waves down on the hourly chart into Wednesday and that confirms that the SPX made a short-term top on 9/2, close to our 3-star geo-cosmic turn window from 9/3-9/6 – the 8-day Fibonacci step-out lands on 9/10-9/13 and that should be a low. Because of the EW 5-waves down in the SPX from 9/2 into 9/8, our bias is that IMPORTANT HIGHS ARE IN - the SPX made its divergent high on 9/2 while the NDX made its divergent high on 9/7 – we are now bracing for a significant correction into early October. The QQQ gave us a Negative Volume Reversal Day on Wednesday and that is bearish. Both the SPY and the IWM are trading below large Dark Pool prints which is bearish. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart argues that a significant top was made on 9/2 and that we can now project a Fibonacci 34-day step out to 10/6 which should be a scary low. The Fibonacci 34-year step out from the great crash of 1987 predicted a MAJOR TOP this fall and our bias is that the market highs are already in - that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. Giving up potential market gains in the seasonally weakest time of the year is a good trade off considering the portfolio risk at hand.  The US bond market is the key market to watch now – our bias is that a rally in the 10-yr US rate is developing and should pressure the SPX into a quick 5-8% correction in the near term.

9/09/21 (Commentary for Thursday) The SPX made a divergent short-term high on 9/2 and the NDX made a divergent high in the 9/6-9/7 New Moon Timing Window which overlaps with the 3-star 9/3-9/6 geo-cosmic turn window – the SPX gave us an EW 5-waves down on the hourly chart to confirm a short-term high. The SPX made its high on 9/2 before the weaker than expected NFP jobs number on 9/3. Many analysts are still calling for further stock blow off as the noted Market Vane sentiment reading for stock bullishness hit multi-year highs at 72% on 8/27. The NDX did make a new high in the 9/6-9/7 Labor Day New Moon and the QQQ gave us a Negative Volume Reversal Day Wednesday which is bearish. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72%, the highest bullish sentiment in years. Since we believe that long rates started a significant rally last week, our bias was to lighten up on technology stocks into the 9/6-9/7 New Moon Timing Window, especially in retirement accounts. In addition, the background monetary conditions are deteriorating - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and an end to the 12-yr bull market from 2009. Bitcoin made a rally peak at 53,125 into the Labor Day New Moon before suffering a 20% mini-crash – it is now holding above its Person’s Pivot at 46,834 overnight Thursday – bitcoin may be leading the SPX down. Gold traced out an EW 5-waves down on the hourly chart and then gave us just a 3-wave sideways correction – the chart looks bearish for a move to $1750. The USD tested its R2 pivot resistance at 92.86 on Wednesday and then gave us 5-waves down on the hourly chart – the trend of the USD is still down.

Big Picture on Stocks (UPDATED) – The SPX made its divergent high on 9/2 and the NDX made its divergent high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. The 34-day Fibonacci step-out from 9/2 projects a scary low on 10/6. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold gave us an EW 5-waves down on the hourly chart to $1783 followed by just a 3-wave sideways correction – this is a bearish chart that points lower. Once again gold failed to give us a follow through day to the upside above $1837 – we should now get a move down to test $1750. Like gold, the GDX also gave us 5-waves down on the hourly chart which is bearish – gold stocks need a macro catalyst like a 3-5% SPX correction before they can get a bid.

• Stocks – The SPY gave us a 3-wave bounce from an overnight low that faded in the first hour on Thursday and we made lower lows on the close. The 8-day Fibonacci step-out projects an initial low on 9/10-9/13. The 34-day Fibonacci step out from 9/2 projects a scary low on 10/6. We added a few IWM puts near the close today.
• Gold – Gold traced out an EW 5-wave decline to $1783 and then just a 3-wave sideways bounce. A move back to test $1750 is likely in the short term.
• Silver – Silver gave us an EW 5-wave decline to test $23.94 early Wednesday which is bearish.
• Bonds – Bonds rallied on a good 10-yr US bond auction on Wednesday and continued to rally on Thursday as the SPX rolled over.
• Crude Oil – Crude oil fell in 5-waves into the Labor Day New Moon and got a corrective bounce on Tuesday – this is a sell signal for the SPX.
• Dollar Index – The USD tested its R2 pivot resistance at 92.86 on Wednesday and then declined in 5-waves on the hourly chart into Thursday – the trend is still down.

TURNING POINT DAY

The turn window for this week is 9/6-9/7 which includes the Labor Day New Moon.

The Daily JDV Market Timer - September 8, 2021

Folks,

Market Observations for the Week: CAUTION: The SPX gave us an EW 5-waves down on the hourly chart today and that confirms that the SPX made a short-term top on 9/2 close to our 3-star geo-cosmic turn window from 9/3-9/6. The Labor Day New Moon on 9/6-9/7 is our first projected Major Top Timing Window for the fall and the SPX made a high on 9/2 while the NDX made a new high on 9/7. The QQQ gave us a Negative Volume Reversal today and that is bearish. Both the SPY and the IWM are trading below large Dark Pool prints. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now and the EW 5-wave decline on the hourly chart argues that a significant top was made on 9/2 and that we can project a Fibonacci 8-day step out to 9/10-9/13 which should be an initial low. The Fibonacci 34-year step out from the great crash of 1987 argues for a Major TOP this fall in our opinion and that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. Giving up potential market gains in the seasonally weakest time of the year is a good trade off considering the portfolio risk at hand.  The US bond market is the key market to watch now – our bias is that a rally in the 10-yr US rate is developing and should pressure the SPX into a quick 5-8% correction.

9/08/21 (Commentary for Wednesday) The SPX made a short-term high on 9/2 and the NDX made a divergent high in the 9/6-9/7 New Moon Timing Window which overlaps with the 3-star 9/3-9/6 geo-cosmic turn window – the SPX gave us a confirming 5-waves down on the hourly chart to argue for a short-term high. The SPX made its  high on 9/2 before the weaker than expected NFP jobs number on Friday. Many analysts are calling for further stock blow off as the noted Market Vane sentiment reading for stock bullishness hit multi-year highs at 72% on 8/27. The NDX did make a new high in the 9/6-9/7 Labor Day New Moon and the QQQ gave us a Negative Volume Reversal Day today which is bearish. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72%, the highest bullish sentiment in years. Since we believe that long rates started a significant rally last week, our bias was to lighten up on technology stocks into the 9/6-9/7 New Moon Timing Window, especially in retirement accounts. In addition, the background monetary conditions are deteriorating - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and an end to the 12-yr bull market from 2009. Bitcoin made a rally peak at 53,125 into the Labor Day New Moon before suffering a 20% mini-crash – it is now holding above its Person’s Pivot at 46,000 overnight Wednesday. Gold peaked Friday on a test of horizontal resistance at $1837, held up into the New Moon on Monday, and then finished an EW 5-wave decline to its S1 support pivot at $1783 early Wednesday – we needed to see a follow-through day higher Tuesday for gold to get the PM sector moving higher, but we got an impulsive reversal down instead – THIS IS BEARISH. The USD sub-divided down impulsively and made a lower low to 91.48 early Friday before a 3-wave bounce into that tested its R2 pivot resistance at 92.86 during the day session on Wednesday.

Big Picture on Stocks (UPDATED) – The SPX made its high on 9/2 and the NDX made its high on 9/7 – the SPX gave us an EW 5-waves down from 9/2 and confirmed a short-term top. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio should get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold rallied to test $1837 resistance on Friday, held up into the 9/6 Labor Day New Moon, and then finished an EW 5-wave decline to test $1783 this morning. Once again gold failed to give us a follow through day to the upside above $1837 – we should now get a move down to test $1750. Gold stocks may need a macro catalyst like a 3-5% SPX correction before they get a bid.

• Stocks – The SPY gave us an EW 5-wave decline into Wednesday morning and confirmed a short-term high on 9/2 – the 8-day Fibonacci step out projects an initial low on 9/10-9/13. The QQQ gave us a Negative Volume Reversal Day today which is bearish.
• Gold – Gold tested $1837 overhead resistance early Friday, then held up into the 9/6 New Moon before washing out in an EW 5-wave decline to test its S1 pivot support at $1783. A move back to test $1750 is likely in the short term.
• Silver – Silver gave us an EW 5-wave decline to test $23.94 early Wednesday which is bearish.
• Bonds – Bonds rallied on a good 10-yr US bond auction, but the charts look bearish to us and we expect rates to take out 1.38% in the short term. We are looking for rates to rally more this week and pressure the NDX down.
• Crude Oil – Crude oil fell in 5-waves into the Labor Day New Moon and got a corrective bounce on Tuesday – this is a sell signal for the SPX.
• Dollar Index – The USD sub-divided down impulsively and we made a new low Friday at 91.47 before a bounce that tested its R2 pivot resistance at 92.86 on Wednesday.

TURNING POINT DAY

The turn window for this week is 9/6-9/7 which includes the Labor Day New Moon.

 

The Daily JDV Market Timer - September 7, 2021

Folks,

Market Observations for the Week: Led by AAPL, NFLX and FB, the NDX made a divergent new high in the 9/6-9/7 New Moon Timing Window, but on negative NYSE market breadth. The Labor Day New Moon on 9/6-9/7 is our first projected Major Top Timing Window for the fall and the SPX made a high on 9/2 while the NDX made a new high today. We had a 3-star geo-cosmic turn window on 9/3-9/6 which encompasses the recent highs. We now need to see an EW 5-wave decline in the NDX or SPX on the hourly chart to confirm a short-term top. If the NDX doesn’t top in the 9/6-9/7 New Moon Timing Window, the odds favor more blow off into the 10/6 New Moon, especially if the SPX or NDX continues higher into 9/15. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now. This divergence could “heal itself” in the next few weeks by a broad-based rally in the Russell 2000 into the 10/6 New Moon or it could manifest into the first significant market correction in about a year by the NDX topping out on 9/6-9/7 – how we trade into Friday will enlighten us. The Fibonacci 34-year step out from the great crash of 1987 argues for a Major TOP this fall in our opinion and that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. Giving up potential market gains in the seasonally weakest time of the year is a good trade off considering the portfolio risk at hand.  The US bond market is the key market to watch now – our bias is that a rally in the 10-yr US rate is getting underway and this could pressure the SPX into a quick 5-8% correction.

9/07/21 (Commentary for Tuesday) The NDX made a new divergent high in the 9/6-9/7 New Moon Timing Window which overlaps with the 3-star 9/3-9/6 geo-cosmic turn window – we now need to see an EW 5-waves down on the hourly chart for the NDX to confirm a short-term top. The SPX made its last high on 9/2 before the weaker than expected NFP jobs number on Friday. Many analysts are calling for further stock blow off as the noted Market Vane sentiment reading for stock bullishness hit multi-year highs at 72% on 8/27. The NDX did make a new high today in the 9/6-9/7 New Moon Timing Window led by AAPL, NFLX and FB. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72%, the highest bullish sentiment in years. Since we believe that long rates started a significant rally last week, our bias was to lighten up on technology stocks into the 9/6-9/7 New Moon Timing Window, especially in retirement accounts. In addition, the background monetary conditions are deteriorating - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and an end to the 12-yr bull market from 2009. Bitcoin made a rally peak at 53,125 into the New Moon before suffering a mini-crash down to 43,000 during Tuesday’s session. Gold peaked Friday on a test of horizontal resistance at $1837, held up into the New Moon on Monday, and then started to decline below $1800 early Tuesday  – we needed to see a follow-through day higher Tuesday for gold to get the PM sector moving higher, but we got a reversal down instead. The USD sub-divided down impulsively and made a lower low to 91.48 early Friday before a 3-wave bounce into Tuesday.

Big Picture on Stocks (UPDATED) – The SPX made its last new high on 9/2 and the NDX made its latest new high today on 9/7 – we need to see an EW 5-waves down on the NDX or SPX hourly chart to confirm a short-term top. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio could get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold rallied to test $1837 resistance on Friday, held up into the 9/6 Labor Day New Moon, and then declined early Tuesday below $1800. Once again gold failed to give us a follow through day to the upside above $1837 – we may now get a move down to test $1750. Gold stocks may need a macro catalyst like a 3-5% SPX correction before they get a bid.

• Stocks – The NDX did give us a divergent high into today’s 9/6-9/7 New Moon Timing Window. We need to see an hourly EW 5-wave decline on the NDX or SPX to confirm a short-term peak.
• Gold – Gold tested $1837 overhead resistance early Friday, then held up into the 9/6 New Moon before washing out below $1800 on Tuesday. A move back to test $1750 is likely in the short term.
• Silver – Silver rolled over bearishly Tuesday morning – once again silver failed to give us a momentum move above $25 which is sign of weakness.
• Bonds – Bonds backed up early Tuesday as the 10-yr US rate tested 1.38%. We are looking for rates to rally more this week and pressure the NDX down.
• Crude Oil – Crude oil fell in 5-waves into the Labor Day New Moon and just got a corrective bounce on Tuesday – this is a sell signal for the SPX.
• Dollar Index – The USD is sub-dividing down impulsively and we made a new low Friday at 91.47 before a bounce into Tuesday.

TURNING POINT DAY

The turn window for this week is 9/6-9/7 which includes the Labor Day New Moon.

The Weekly JDV Market Timer - September 5, 2021

Folks,

Market Observations for the Week: The SPX corrected into the weaker than expected NFP jobs report and bounced into the close, but of greater importance is that bond rates moved higher. Our bias is that the SPX could make a significant high in the 9/6-9/7 New Moon Timing Window this week as US long rates make their way higher. The Labor Day New Moon on 9/6-9/7 is our first projected Major Top Timing Window for the fall and the 10/6 New Moon is the second projected Major Top Timing Window. If the SPX doesn’t top in the 9/6-9/7 New Moon Timing Window, the odds favor more blow off into the 10/6 New Moon, especially if the SPX continues higher into 9/15. The NYSE Advance/Decline line has been diverging from the steady advance of the SPX for weeks now. This divergence could “heal itself” in the next few weeks by a broad-based rally in the Russell 2000 into the 10/6 New Moon or it could manifest into the first significant market correction in about a year by topping out on 9/6-9/7 – we argue for the latter but are open to both scenarios. The Fibonacci 34-year step out from the great crash of 1987 argues for a Major TOP this fall in our opinion and that is why we argue for a minimum 70%+ cash position at this time and the willingness to hold it into December. Giving up potential market gains in the weakest time of the market year is a good trade off considering the portfolio risk at hand.  The US bond market is the key market to watch now – our bias is that a sudden 10-yr rate rise may strike after Labor Day – this could pressure the SPX into a quick 5-8% correction.

9/05/21 (Commentary for Sunday) Our first fall target for a potential major top in stocks is the 9/6-9/7 Labor Day New Moon and this overlaps with the 3-star 9/3-9/6 geo-cosmic turn window. The SPX pulled back into Friday but could reverse higher into the 9/6-9/7 New Moon Timing Window and make a significant peak. The weaker than expected NFP jobs number could be written off as a temporary Delta-variant issue and the SPX could rally into the 9/6-9/7 turn window led by the recovery stocks. Many analysts are calling for further stock blow off as the noted Market Vane sentiment reading for stock bullishness hit multi-year highs at 72% on 8/27. Our bias is for the SPX to make a significant high in the 9/6-9/7 Labor Day New Moon Timing Window with the recovery stocks leading in a potential final run higher. We raised our cash position to 70% after the Market Vane Bullish Percent went to 72%, the highest bullish sentiment in years. Since we expect long rates to start rallying this week, we would take profits in tech stocks into the 9/6-9/7 turn window, especially in retirement accounts. In addition, the background monetary conditions are deteriorating - US liquidity conditions are tightening in advance of the Fed taper as US Excess Liquidity measures continue to roll over and that predicts a “compression” in the S&P 500 P/E ratio this fall and an end to the 12-yr bull market from 2009. Gold reversed higher early Friday and tested $1837 before correcting into Sunday night – we need to see a follow-through day by early Tuesday to get the PM sector moving higher. The USD is sub-dividing down impulsively and it made a lower low to 91.48 early Friday before a corrective bounce – the trend has turned down and that should support the PM sector. 

Big Picture on Stocks (UPDATED) – The SPX has continued to sub-divide higher into the 9/3-9/6 3-star geo-cosmic turn window and this could mark a significant top.  At Jackson Hole on 8/27, Chairman Powell gave a green light for more stock blow off into the 9/6 New Moon or into the 10/6 New Moon, our second fall time target. We raised our cash level to 70% when the Market Vane Bullish Percent hit 72% on 8/27. The US Excess Liquidity measure is rolling over – the lofty S&P 500 P/E ratio could get “compressed” this fall.

Big Picture on PMs (UPDATED) – Gold rallied to test $1837 on Friday before correcting into Sunday evening. It will take a momentum move above $1837 to convince us that a substantial rally is underway. Gold stocks may need a macro catalyst like a 3-5% SPX correction before they get a bid.

• Stocks – The SPX continues to grind higher into the 9/3-9/6 turn window which includes the 9/6-9/7 New Moon. The NFP jobs report came in weak, but the SPX held up even though rates started to move higher. A rally into the 9/6-9/7 New Moon Timing Window could give us a significant top this week.
• Gold – Gold tested $1837 Sunday and started a correction into Sunday evening. We need to see a momentum move above $1837 to really get long the PM sector.
• Silver – Silver tested $25 Friday and started trending sideways into Sunday evening – silver stocks led silver higher last week. We need to see a momentum move above $25 by early Tuesday to really get long silver.
• Bonds – Bonds gave us big volatility on Friday – first a rally on NFP job report weakness and then weakness later as the 10-yr US rate rose to test 1.34%. We are looking for rates to rally more this week.
• Crude Oil – Crude oil tested $70.61 on Thursday and then corrected in 3-waves into late Sunday evening – money appears to be rotating into the energy sector here. Uranium was an outstanding performer last week.
• Dollar Index – The USD is sub-dividing down impulsively and we made a new low Friday at 91.47 – the USD may have made an important high at 93.73 on 8/20 – this should benefit the PM sector.

TURNING POINT DAY

The turn window for this week is 9/6-9/7 which includes the Labor Day New Moon.