All Star Market Timing

The Weekly JDV Market Timer - October 30, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: The E-mini sold off initially on the AAPL and AMZN earnings but the market reversed early Friday and the SPX made highs for the week above 3900. The SPX continued to advance despite less-than-hoped earnings from the big tech stocks and rallied passed an important turn window on 10/25-10/26 which also included a TRIN-5 SELL SIGNAL - this is a "sign of strength" so far and could hold the SPX up going into the Fed meeting this week. Bitcoin holding above 20000 also is supportive of the stock market bulls.  Coming into last week, the NYSE breadth was deeply oversold, and we did not see any intra-day negative breadth action which was bullish. Crude oil and other commodities were sold off on Friday. The main thing to us is that the USD and 10-yr US rate have only corrected in 3-waves which from 10/13 and that puts us on the defensive.

10/30/22 (Commentary for Sunday) We are impressed with the resiliency of the SPX three days after our 10/25-10/26 turning point window and after a TRIN-5 SELL SIGNAL - this is a "sign of strength" and could argue for more gains in the near term after the Fed action this week.   We got a TRIN-5 SELL SIGNAL on Wednesday's close and this signal has ended multiple "bear market rallies" in 2022. With that said, and even with the negative reaction to the earnings reports from AAPL and AMZN Thursday night, we could still see another test of SPX 3900 into early next week. We believe in what Marty Zweig once said - "Do Not Fight The Fed" - and we believe that the Fed is going to have to work longer and harder than most traders and investors believe to reverse inflation down - despite what the Bank of Canada did Tuesday (a 50 basis-pt instead of a 75 basis-pt rate hike). With that said, the weak link in the global banking system is Europe which could be a flashpoint for global contagion and since Europe is the strongest American ally at this time, we believe that the Fed will have to act to contain a European banking crisis, and this could be the "pivot moment" that many traders are desperately looking for. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. Bitcoin has closed above key resistance at 20000 on Wednesday and Thursday and that is encouraging to the bulls. The 10-yr US rate has only corrected in 3-waves on the hourly here and its trend is still higher which is a risk to the SPX and PM sector.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 - down to SPX 2400 - as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – Gold continued to rally into Wednesday as the USD continued its correction. However, we still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The SPX did continue its rally past our 10/25-10/26 turn window and our TRIN-5 SELL SIGNAL - this is a "sign of strength".  We expect a typical pullback into the Fed-day on Wednesday.  If all we get is a 3-wave pullback by the close Wednesday, this is bullish for a run to SPX 4000+ by next week.
• Gold – Gold bottomed at $1621 on 10/21, the 3-star critical reversal day, but the rally since looked corrective and leaves this market open to a retest of $1621.
• Silver – Silver bullishly diverged on 10/21 from gold and traded better last week.
• Crude Oil – Crude oil sold off on Friday but strength in the OIH(the oil service stocks) suggests that we started a new upleg higher.
• Dollar Index – The USD has given us just a 3-wave correction into today - we could still test the recent highs at 114.

TURNING POINT DAY

The turn window for this week is 11/2-11/3.

The Daily JDV Market Timer - October 27, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: We still embrace the 10/25-10/26 turn window, which has been circled on a calendar for some time, as an important turn window and it looks to be a TRADING HIGH. This is a triple-turning-point day in our work - the Tuesday after a monthly expiration, a New Moon and a solar eclipse. Wednesday's market close gave us a TRIN-5 SELL SIGNAL (3.70) which has ended bear market rallies this year. Yesterday was the 13-day step out from the 10/13 low and another turn day. The futures sold off after the earnings reports from AAPL and AMZN, but we have not seen a 5-waves down on the hourly E-mini overnight to give us a sell signal. Bitcoin remains above 20000 giving hope to the bulls. We are cautious here and prefer to be in mainly cash.

10/26/22 (Commentary for Thursday) We believe that the SPX is making an important trading high in the 10/25-10/26 turn window and we would be using this opportunity to sell long trading positions. We got a TRIN-5 SELL SIGNAL on Wednesday's close and this signal has ended multiple "bear market rallies" in 2022. With that said, and even with the negative reaction to the earnings reports from AAPL and AMZN Thursday night, we could still see another test of SPX 3900 into early next week. We believe in what Marty Zweig once said - "Do Not Fight The Fed" - and we believe that the Fed is going to have to work longer and harder than most traders and investors believe to reverse inflation down - despite what the Bank of Canada did Tuesday (a 50 basis-pt instead of a 75 basis-pt rate hike). With that said, the weak link in the global banking system is Europe which could be a flashpoint for global contagion and since Europe is the strongest American ally at this time, we believe that the Fed will have to act to contain a European banking crisis, and this could be the "pivot moment" that many traders are desperately looking for. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. Bitcoin has closed above key resistance at 20000 on Wednesday and Thursday and that is encouraging to the bulls. The 10-yr US rate has only corrected in 3-waves on the hourly here and its trend is still higher which is a risk to the SPX and PM sector.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 - down to SPX 2400 - as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – Gold continued to rally into Wednesday as the USD continued its correction. However, we still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The SPX did continue its rally into our 10/25-10/26 turn window and tested 3900 and its 50-dma before fading into the close on Wednesday and getting a TRIN-5 SELL SIGNAL (3.70).  Despite the afterhours futures selloff following the earnings from AAPL and AMZN, there is still a chance for a test of SPX 3900 going into early next week.
• Gold – Gold bottomed at $1621 on 10/21 - the 3-star critical reversal day and then reversed higher into the 10/25 New Moon/solar eclipse.
• Silver – Silver bullishly diverged on Friday when gold made a slight undercut low and then bounced into the 10/25 New Moon.
• Crude Oil – News of tight US oil inventories at the wholesale level has changed our view on crude oil which bottomed out near the New Moon - the OIH (oil service stocks) and XOM are trying to pull crude oil higher.
• Dollar Index – The USD has given us just a 3-wave correction into today - we could still test the recent highs at 114.

TURNING POINT DAY

The turn window for this week is 10/25-10/26.

The Daily JDV Market Timer - October 26, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: The SPY sold off overnight after the disappointing MSFT and GOOGL earnings. However, after initial weakness today, the SPX tested the 3900 level and its 50-dma before selling off into the close. We still embrace the 10/25-10/26 turn window, which has been circled on a calendar for some time, as an important turn window and it looks to be a TRADING HIGH. This is a triple-turning-point day in our work - the Tuesday after a monthly expiration, a New Moon and a solar eclipse. Today was the 13-day step out from the 10/13 low and another turn day. We are cautious here and prefer to be in mainly cash.

10/26/22 (Commentary for Wednesday) We still believe that the SPX could be making an important trading high into the 10/25-10/26 turn window and we would be using this opportunity to sell long trading positions. We believe in what Marty Zweig once said - "Do Not Fight The Fed" - and we believe that the Fed is going to have to work longer and harder than most traders and investors believe to reverse inflation down - despite what the Bank of Canada did today (a 50 pt instead of a 75 pt rate hike). With that said, the weak link in the global banking system is Europe which could be a flashpoint for global contagion and since Europe is the strongest American ally at this time, we believe that the Fed will have to act to contain a European banking crisis, and this could be the "pivot moment" that many traders are desperately looking for. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. Bitcoin has closed above key resistance at 20000 on Wednesday and that is encouraging to the bulls. The 10-yr US rate has only corrected in 3-waves here and its trend is still higher which is a risk to the SPX and PM sector.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 - down to SPX 2400 - as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – Gold continued to rally into Wednesday as the USD continued its correction. However, we still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The SPX did continue its rally into our 10/25-10/26 turn window and tested 3900 and its 50-dma before fading into the close.  This window includes the Tuesday after a monthly option expiration, the New Moon and a solar eclipse. We would not hold trading longs past today.
• Gold – Gold bounced to $1679 today and corrected into the close.
• Silver – The weaker USD supported silver today.
• Crude Oil – News of tight US oil inventories at the wholesale level has changed our view on crude oil which bottomed out near the New Moon - the OIH (oil service stocks) and XOM are trying to pull crude oil higher.
• Dollar Index – The USD has given us just a 3-wave correction into today - we could still test the recent highs at 114.

TURNING POINT DAY

The turn window for this week is 10/25-10/26.

The Daily JDV market Timer - October 25, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: The SPX rallied into Tuesday's close and is waiting for the earnings reports from MSFT and GOOGL. Today is a triple-turning-point day in our work - the Tuesday after a monthly expiration, a New Moon and a solar eclipse. Tomorrow is the 13-day step out from the 10/13 low and another turn day. We are cautious and would not hold trading longs into Wednesday. Disappointing earnings from GOOGL, MSFT, and Texas Instrument underscore a slowing economy.

10/25/22 (Commentary for Tuesday) We believe that the SPX could be making an important trading high into the 10/25-10/26 turn window and we would be using this opportunity to sell long trading positions. We believe in what Marty Zweig once said - "Do Not Fight The Fed" - and we believe that the Fed is going to have to work longer and harder than most traders and investors believe to reverse inflation down. With that said, the weak link in the global banking system is Europe which could be a flashpoint for global contagion and since Europe is the strongest American ally at this time, we believe that the Fed will have to act to contain a European banking crisis, and this could be the "pivot moment" that many traders are desperately looking for. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. Bitcoin did close above key resistance at 20000 on Tuesday and that is encouraging to the bulls. The 10-yr US rate has only corrected in 3-waves here and its trend is still higher which is a risk to the SPX and PM sector.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 - down to SPX 2400 - as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – The breakout to multi-year highs in the 10-yr US rate continues to weigh on gold - but gold did bounce into today's New Moon. We still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The SPX did continue its rally into our 10/25-10/26 turn window which includes the Tuesday after a monthly option expiration, the New Moon and a solar eclipse. We would not hold trading longs past today.
• Gold – Gold did bounce into today's New Moon/solar eclipse but today could be the high for the week.
• Silver – SILJ appears to be leading the PM complex down here.
• Crude Oil – Crude oil's chart is looking bearish to us but oil stocks like XOM and CVX were still holding up on Tuesday. Oil stock leader, COP, did give us a NEGATIVE VOLUME REVERSAL DAY on Tuesday, however.
• Dollar Index – The USD gave us just a 3-wave correction in recent weeks - we could test the recent highs at 114.

TURNING POINT DAY

The turn window for this week is 10/25-10/26.

The Weekly JDV Market Timer - October 23, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: The SPX tested the hourly 200-ma on Tuesday and is testing it again on Friday's expiration day. Our 10/20-10/21 turn window now looks like a trading high that could possibly extend into Monday. The 10/20-10/21 turn window could be a 3-wave trading high that would set up another retest of the recent lows below SPX 3500.  The SPX did test its hourly 200-ma on Tuesday, so a move down to undercut lows would not surprise us. The driving force in the market is the rising 10-yr US rate which tested 4.3% today, the highest since 2008. Our belief is that the Fed wants the US stock market down (as Marty Zweig said - "Don't Fight the Fed!") and wants the labor market to cool off - we believe that they will accomplish this "big time" into the spring of 2023. Bitcoin remains under 20000 resistance and appears to be tracing out a large "bear flag" pattern that will resolve lower in the next week or so. Crude oil did test $87.5 Friday and XOM hit its yearly high near $106 but overall, the crude oil chart looks negative to us. The 10-yr US rate broke out to multi-decade highs around 4.3% today but the PM sector rallied on Friday's triple-witching expiration. 

10/23/22 (Commentary for Sunday) We believe that the SPX could be making an important trading high in the 10/20-10/21 turn window and we would be using this opportunity to sell long trading positions. The SPX rallied on today's expiration despite the US 10-yr rate testing 4.3% but we view today as a triple-witching anomaly instead of a sing of strength for the SPX. We believe in what Marty Zweig once said - "Do Not Fight The Fed" - and we believe that the Fed is going to have to work longer and harder than most traders and investors believe to reverse inflation down. With that said, the weak link in the global banking system is Europe which could be a flashpoint for global contagion and since Europe is the strongest American ally at this time, we believe that the Fed will have to act to contain a European banking crisis, and this could be the "pivot moment" that many traders are desperately looking for. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. Bitcoin remains below its major resistance at 20000 and has fallen into a low-volatility sideways trend that looks like a bear flag pattern to us with downside potential. The 10-yr US rate broke out to 14-year highs (4.3%) and should continue to pressure the PM sector down after today's expiration.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 - down to SPX 2400 - as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – The breakout to multi-year highs in the 10-yr US rate continues to weigh on gold - but on today's expiration the PM sector did bounce. We still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The post-CPI report stock rally may be double-peaking on Friday's expiration - another test of the 10/13 lows below SPX 3500 is possible.
• Gold – Despite Friday's bounce after testing $1622, gold is still being pressured down by a strong USD and 10-yr US rate and could test $1622 again soon - and then major support at $1570.
• Silver – Silver stocks appear to be leading the PM complex down.
• Crude Oil – Crude oil's chart is looking bearish to us but oil stocks like XOM and COP were bid up aggressively into Friday's expiration.
• Dollar Index – The USD gave us just a 3-wave correction in recent weeks - we could test the recent highs at 114.

TURNING POINT DAY

The turn window for this week is 10/20-10/21.

The Daily JDV Market Timer - October 20, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: The SPX tested the hourly 200-ma on Tuesday and reversed down - our bias is that the multi-day 3-wave corrective bounce peaked on 10/18, and we may be heading down for an undercut low into our 10/20-10/21 turn window.  The 10/20-10/21 turn window could be a trading low that would set up another bounce attempt or the 10/20-10/21 turn window came in early on 10/17 as a HIGH and we may be heading down to make undercut lows in the SPX. The SPX did test its hourly 200-ma on Tuesday, so a move down to undercut lows would not surprise us. The driving force in the market is the rising 10-yr US rate which tested 4.2% today, the highest since 2008. Our belief is that the Fed wants the US stock market down (as Marty Zweig said - "Don't Fight the Fed!") and wants the labor market to cool off - we believe that they will accomplish this "big time" into the spring of 2023. Bitcoin remains under 20000 resistance and appears to be tracing out a large "bear flag" pattern that will resolve lower in the next week or so. Crude oil did bounce today and oil stocks got bought aggressively, however, the crude oil chart does not look bullish to us. The 10-yr US rate broke out to multi-decade highs today and continued to pressure the PM sector down. 

10/20/22 (Commentary for Thursday) We believe that the SPX made its high for the week on Tuesday on the test of its hourly 200-ma. Higher highs on the US 10-yr rate to 4.2% today pressured stocks down despite decent earnings reports - we believe in what Marty Zweig once said - "Do Not Fight The Fed" - and we believe that the Fed is going to have to work longer and harder than most traders and investors believe to reverse inflation down. With that said, the weak link in the global banking system is Europe which could be a flashpoint for global contagion and since Europe is the strongest American ally at this time, we believe that the Fed will have to act to contain a European banking crisis, and this could be the "pivot moment" that many traders are desperately looking for. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. If the SPX does suffer a chaotic fall into expiration Friday, then on Monday/Tuesday, we will chase a few rebound trades in our favorite stocks. Bitcoin remains below its major resistance at 20000 and has fallen into a low-volatility sideways trend that looks like a bear flag pattern to us with downside potential. The 10-yr US rate broke out to 14-year highs (4.2%) and continues to pressure the PM sector down.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 - down to SPX 2400 - as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – The breakout to multi-year highs in the 10-yr US rate continues to weigh on gold - a retest of $1622 looks imminent. We still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The post-CPI report rally peaked on Tuesday's test of the hourly SPX 200-ma - an undercut low is possible going into our 10/20-10/21 turn window which could extend through Friday's expiration.
• Gold – Gold is still being pressured down by a strong USD and 10-yr US rate and could test $1622 soon - and then major support at $1570.
• Silver – Silver stocks appear to be leading the PM complex down.
• Crude Oil – Crude oil's chart is looking bearish to us but oil stocks like XOM and COP were bid up aggressively this week.
• Dollar Index – The USD gave us just a 3-wave correction in recent weeks - we could test the recent highs at 114.

TURNING POINT DAY

The turn window for this week is 10/20-10/21.

The Daily JDV Market Timer - October 19, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: The SPX tested the 200-dma on Tuesday and reversed down - the multi-day 3-wave corrective bounce may have peaked yesterday, and we may be heading down for an undercut low into our 10/20-10/21 turn window.  The 10/20-10/21 turn window could be a trading low that would set up another bounce attempt. The SPX did test its 200-dma yesterday, so a move down to lower lows would not surprise us. Bitcoin remains under 20000 resistance and that is not near-term bullish for the SPX. Crude oil did bounce today and oil stocks got bought aggressively, however, the crude oil chart does not look bullish to us. The 10-yr US rate broke out to multi-decade highs today and continued to pressure the PM sector down. 

10/19/22 (Commentary for Wednesday) The multi-day SPX corrective bounce may have peaked yesterday on the test of its 200-dma. Multi-year highs on the US 10-yr rate pressured stocks down despite decent earnings reports. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. If the SPX does suffer a chaotic fall into expiration Friday, then on Monday/Tuesday, we will chase a few rebound trades in our favorite stocks. Bitcoin remains below its major resistance at 20000 and has fallen into a low-volatility sideways trend. The 10-yr US rate broke out to multi-year highs and continues to pressure the PM sector down.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 as the 20-yr cycle low bottoms and the US economy slows to a recession. The 13-month Fibonacci step out from the 1/4/22 high and the 55-wk Fibonacci step out have us looking to early February for an important low. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – The breakout to multi-year highs in the 10-yr US rate continues to weigh on gold - a retest of $1622 looks imminent. We still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The post-CPI report rally peaked on yesterday's test of the SPX 200-dma - an undercut low is possible going into our 10/20-10/21 turn window.
• Gold – Gold is still being pressured down by a strong USD and 10-yr US rate.
• Silver – Silver appears to be leading the PM complex down.
• Crude Oil – Crude oil rebounded today and oil stocks like XOM were bid up aggressively.
• Dollar Index – The USD gave us just a 3-wave correction in recent weeks - we could test the recent highs.

TURNING POINT DAY

The turn window for this week is 10/20-10/21.

The Daily JDV Market Timer - October 18, 2022

We are still on travel with limited access to the internet, so our reports will be brief.

Folks,

Market Observations for the Week: We view the post-CPI rally as a multi-day 3-wave corrective bounce that may have peaked today.  After today's initial decline on the 5-min chart, we just got a corrective bounce and that may indicate more down into Wednesday and perhaps an undercut low. Our 10/20-10/21 turn window could be a trading low. The SPX did test its 200-dma today, so a move down to lower lows would not surprise us. Bitcoin remains under 20000 resistance and that is not near-term bullish for the SPX. On weak Chinese demand figures, crude oil is below $82.5 and the chart is looking bearish. Gold is below $1675 long-term support and that looks bearish. The 10-yr US rate may be coiling for a breakout move higher. 

10/18/22 (Commentary for Tuesday) The multi-day SPX corrective bounce may have peaked today on the test of its 200 dma. The sharp move down this morning was only met with a corrective bounce, so we could see more down into the 10/20-10/21 turn window and possibly an undercut low. These are treacherous markets, and we prefer to stay in 100% cash beyond our physical metals position. If the SPX does have a chaotic fall into Monday/Tuesday, we will chase a few rebound trades in our favorite stocks. The soft Chinese demand figures hit crude oil hard, and its chart is looking bearish to us. The 10-yr US rate looks to be coiling for a breakout move and that could further pressure the PM sector.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 as the 20-yr cycle low bottoms and the US economy slows to a recession. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – Post PPI and CPI reports, gold is being pressured down by rising rates and a rising USD. We still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The post-CPI report rally may have peaked on today's test of the SPX 200-dma - an undercut low is possible going into our 10/20-10/21 turn window.
• Gold – Gold is still being pressured down by a strong USD and 10-yr US rate.
• Silver – Silver appears to be leading the PM complex down.
• Crude Oil – Crude oil got clocked by the soft Chinese demand numbers and its chart is looking bearish to us.
• Dollar Index – The USD gave us just a 3-wave correction - we could test the recent highs.

TURNING POINT DAY

The turn window for this week is 10/20-10/21.

The Weekly JDV Market Timer - October 16, 2022

We are still on travel with limited access to the internet, so our report is brief.

Folks,

Market Observations for the Week: The SPX gave us an EW 5-waves down after the CPI report early Thursday and started what could be a multi-day corrective bounce into this week's 10/21 3-star critical reversal day. Hotter than expected PPI and CPI reports has the Fed prepared to work and harder to tame surging inflation. The Fed is prepared to take the Federal Funds Rate (FFR) into "positive real rates" to tame inflation into 2023 and this should bring a rapid slowing in US economic activity and hopefully to the rising rents and rising labor costs that are plaguing the US. The SPX had several time cycles that bottomed on Thursday and gave us another fierce corrective bounce that could last a few days before rolling over again. Crude oil is still trying to rally after the OPEC price cut - we're not sure if the move is corrective or impulsive yet. Gold appears to be breaking down again to test support in the $1620s - a 2013-type scenario is still possible - the PM sector could still test its March 2020 Covid lows around $1500 by Feb/March 2023. The USD and 10-yr US only corrected in 3-waves recently and threaten to make higher highs which could pressure the PM sector. We still favor holding 80% cash and 20% in physical metals.

10/16/22 (Commentary for Sunday) The key point for Monday is whether the post-CPI rally is just the end of a "Running B-Wave" consolidation pattern or the start of a multi-day corrective bounce that could run into the 10/21 turn window - how the SPX trades on Monday will tell us. A collection of SPX cycles gave us a bounce late last week, but we need to see some follow through higher on Monday or the Running-B-Wave scenario will become our preferred count and we could see the next leg down. Bank stocks did well after their earnings reports on Friday and this could help support the market on Monday.  We are ~80% cash and ~20% in physical gold/silver/platinum.

Big Picture on Stocks (UPDATED) – Longer term, the SPX could give us a 20%-50% correction by spring 2023 as the 20-yr cycle low bottoms and the US economy slows to a recession. We favor a high percentage of cash for capital preservation.

Big Picture on PMs (UPDATED) – Post PPI and CPI reports, gold is being pressured down by rising rates and a rising USD. We still expect gold stocks to test their COVID lows by Fed/March 2023 as the 8-yr gold cycle and the 20-yr stock market cycle converge on the downside. Central bankers are loading up on gold this year as global physical inventories continue to decline but higher nominal US rates can still pressure the PM sector down.

• Stocks – The SPX found a temporary low late last week after the CPI report but how we trade on Monday is key. 
• Gold – Gold is still being pressured down by a strong USD and 10-yr US rate.
• Silver – Silver appears to be leading the PM complex down.
• Crude Oil – Crude oil held above $85 on Friday - not sure if this is an impulsive move or corrective move from last week yet.
• Dollar Index – The USD gave us just a 3-wave correction - we could test the recent highs.

TURNING POINT DAY

The turn window for this week is 10/21.

The Daily JDV Market Timer - October 13, 2022

Folks,

Our travel has extended into the upcoming weekend, so our daily posts will be brief this week.

Market Observations for the Week: The "hotter than expected" CPI number gave us slammed the market down to an undercut low for the SPX and a 5-wave down pattern completion - we should now get a corrective bounce into next week which contains the 3-star critical reversal day on 10/21. Gold is getting slammed by higher rates and still looks vulnerable to lower lows.  With a stronger than expected PPI and CPI reports, the Fed will have to work harder and longer to fight inflation and risk a destabilizing event for global markets.