Be careful with data manipulation (regarding the recent job report), check the "Job Openings: Total Nonfarm" (blue Line) and its relation with the previous big crashes (S&P500; yellow line).
Thanks for sharing this. Super interesting. I'm going to run correlation on this.
SpyMasterTrades
⋅
@spy_master, Ran correlation and decent correlation on multiple timeframes. I'm definitely going to take note of this. Thanks for sharing.
BrainRules
⋅
@spy_master, Thank very much. Yes please, if you can research and write more about all this using my ideas it will be great, I love your work. I don't know what is going to happen, but if we analyse my 10 'crash' charts there is still some risks of a big crash in the following weeks/months.
SpyMasterTrades
⋅
@BrainRules, Thank you for the compliment, and yes, I will definitely research this more. So far the correlation research shows that the chart you have here is indeed valid. There is a significant position correlation on almost every time frame between job openings and the SPX. I think it's awesome that you detected this. Did you discover this yourself?
I think the irony is that we have many analysts saying that job openings getting filled is good news for the economy because it will help the labor shortage, and yet statistically job openings falling is bad for the stock market. Indeed, job openings are falling because initial unemployment claims are rising. Laid-off workers are filling the vacancies. By there having been so many job openings in the first place, what's actually happening is that the unemployment rate is staying low despite initial claims skyrocketing - laid off workers get quickly re-employed. This allows the Fed to continue tightening even though so many people are losing their jobs. Very rarely does the Fed tighten while initial unemployment claims are rising and GDP is slowing. Ultimately, this is going to be absolutely disastrous. By using a lagging indicator like the unemployment rate to justify continued historic tightening, by the time unemployment starts exploding higher, it will be too late to do anything. One thing that is making this all worse, as well, is that COVID-19 caused such sudden and historic unemployment, and yet we had a v-shaped recovery. This artificiality has created the perception among investors and traders that unemployment can go high and it's no problem at all for the stock market, the FED will just use monetary policy and everything will be ok. But in the face of inflation, the FED cannot do much to prop up the economy should it turn down. The supply-side inflationary pressures will continue even if unemployment skyrockets, resulting in stagflation. Perhaps I'll write up a post on this!
Anyway, I followed you here because all of your charts are spot on, and I look forward to your future posts as well. The only thing that I care about when following someone on here is the quality of their posts (don't care how many followers they have or anything like that). Personally, I think this chart here should be an Editor's Pick.
In response to the possibility of a "crash", I will just say this: I'm not one to incite fear, but there has not been a single chart that I have seen that has convinced me that a significant downturn can be averted, every chart I see is indicating that a significant downturn is either coming in the year(s) ahead or already underway.
BrainRules
⋅
@spy_master, Thanks a lot for your complete answer and for your compliment. Due to the last unemployment report data I felt I should search other job data/chart and compare them to the S&P 500 crashes. Indeed, "Job Openings" seems to have a perfect correlation with those crashes. Also useful his "Hires: Total Nonfarm" as you can see in my last comment in this post. Thanks a lot again for the precious information you are publishing.