Where to begin as there are far too many Data Points within the Macros.
Consumer Senitment dropped sharply last month. This is always
a precedent to Downturns, it closed @ 71 for the Month of August.
86/100 years Price has tested the 200SMA
8 Monthly Bull Bars, very low proabability.
9 Monthly Bull Bars, extremely low probability as this has not occured in 60 Years.
Asia has been in turmoil with the US Markets ignoring the signs from China our preferred
vector for disruption after the EU collision.
The Government shutdown can be prevented as the Votes exist, although $4.5 Trillion
in spending is going to face obstacles at a time when benefits continue to expire.
Bonds are, again, acting poorly against the FX Accident we are forecasting for
Currencies - it is frankly difficult to refer to them as such as they no longer are
given their underlying Debt Market creation is evaporating quickly.
The DX is the leader.
Those of you who are/remain regular readers know - My thesis is simple and direct with
respect to Bonds - they will not catch the "Flight to Safety Bid" as they no longer are Safe.
Instead, they will follow the Markets in a "Positive Correlatrion" to the Downside.
Yields will begin to rise again. We see the 10Yr's YCC effort abating short term and
failing intermeidate term.
Housing will suffer a correction, as Credit itself is tightening - All Credit.
The Semiconductor Supply Shortage has been played down imho, it is far more severe
than is being touted.
Q3 EPS will be an unmitigaed diasater for most of the TECH Arena, it will be comical to
observe the excuses mount. Suddenly, very suddenly, it will become REAL.
We see the Producer Price Index far exceeeding the Consumer Price Index by over 100%.
Which implies Producer are NOT passing along the majority of Price Stresses building.
In turn, the implications are HIGHER PRICES ahead, Inflation is NOT ABATING, but
accelerating.
Independent Producers are unable to compete. Most of the Restaruants I frequent have
increased their Prices 30% in a short period of time. This is a wealthy community, on balance
there is a large pool of high income earners who can afford to spend for necessities.
Average incomes among the Professional class in TECH and Services earn $400K+. A
$200 Dinner for 2 is "affordable" and keeps the decreasing number of survivors afloat,
for now.
They are YOLO Prime, it's all about the Dollars.
And speaking of the Dollar, it is tee'd up to rise as the Flight to Safety, Gold will follow
suit as well after it completes it's pattern. Equities, Bonds and Real Estate will all comply
with the Downturn.
There has been a high degree of Bond BTD for months on end, this will come to a decided
end as TLT begins to trade to 139s over the coming several months.
We see a 7, 9 to 13 week correction with the attendant "Flash Crash" panic moment where
Retail exits after the sufferage begins to weigh. This is normal, cyclical and acceptable.
It does not mean the Equities Markets will be cut in one half, we don't believe this based
upon the present projections. Breaking 3588 on the ES would, however, give us pause.
Rather, we see 4/5 completing near and between 200-400SMAs, a good panic Dip-In below
the 200SMA's to provide Fuel for new highs as the FED will, no doubt 10X down on demands
for Powell's follow-on at the FED to "Amp it up" - we call it the "make em gag for it" moment.
That is ahead and quite frankly, Long will be the Trade - imho.
5/5 will complete and that will be the end of the Longest Bull Market in History. It should
conclude in 2022. We shall see as a great deal depends upon how DEBT itself re-appears
under new arrangements Globally.
IS there a Risk we will retest the Highs?
We do not believe so, at least nothing dramatic in terms of a Retracement as they are
being SOLD Wholesale.
The Bond Markets repsonse to the FED will be instrucitve and quite llikley very disappointing
for the Buy the Bond Dip Echo Chamber.
They fail to see their own demise.
It makes a Market, for certain. We'll oppose the Long Bond Trade all day.
1.75% - 2.00% will do it. THE BOND MARKET WILL PRICE IN "INFLATION" - it is this simple.
Time - it's next week or 5 weeks for the real reaction, we believe the shorter end panic
unfolds as the waters continue to grow murky Globally. NExt's week's reaction can be
A large RT or to and through the lows, straight down.
Geopolitical Risks loom large as we have outlined, the ECB is simply done, out of bullets and
facing immense distrust within the EU. France is prepping for Bastille V.2 - the French are
becoming Militant.
CASH ($USD) will continue to be Hoarded, another strike against the Bond Complex. The hoarding
will continue to GROW.
Reverse Repos and US Treasury actions are draining Liquidity and Bond Demand has been met
witin the United States, it is Sovereigns who will see the lasrgets haricuts on their bids.
Repos are going to roll over, again, BOND Negative.
Gold - we see the pattern completing and Gold taking off to new highs. Silver will provide come
clear indications for teh strength of the move and whether the Highs are retested. Deflatioanry
forces will ulitmately have the desired effect for Gold Bugs, we are not there.
The DX can and will cause probems in the short term for GOLD.
The DX will be the flight to safety FIRST, not Gold and certainly not Silver as touted.
The Gold/Silver Gurus - for the 40+ years I have traded it, are always out over their Predition Skis,
not that they are wrong about Economic Conditions... but with respect to Hype, they are always
ahead of themselves for 44 years and counting.
Since 1977, when I began trading/accumulating Physical metals.
The same Sh_t Show... every decade. It is amazing.
On to the the ES...
We have the Death Cross, we have seen rejection take place 3 times.
50 fails, 100 fails, 200 awaits. EMAs have rolled over.
We have a failing wedge into the 1/5 around 4380 - perhaps ahead of the FED.
Wednesday or ahead of it, we would need to see a large Counter-Trend Up o the FED.
Traders need to be on guard... we can bottom out and rallying on Powell's
Meme.
Watch for the lower High for a short term reversal.
4400 to 4370 - this range can provide support SHORT TERM, which ONLY serves to
provide the LOWER LOWS into a FLASH CRASH.
OR
It can simply power down on Bond Yileds blowing up and finally pushing through the
YCC actions to 4100. 3850-3900 is KEY SUPPORT in the weekly timeframe.
We'll know as we approach the follow-thru. For now, keeping an open mind to Price
is best. VX is expanding... 35 - 40 for VIX is our overhead Objective, it can go far higher.
Anything can trade for Price, it can also DUMP far more.
They are attempting to prevent - Straight down.
Crypto - has simply been used as a Dispencery for Illegal Laundering and a large Basket for
Trading.
Regulations will do the rest.
Consumer Senitment dropped sharply last month. This is always
a precedent to Downturns, it closed @ 71 for the Month of August.
86/100 years Price has tested the 200SMA
8 Monthly Bull Bars, very low proabability.
9 Monthly Bull Bars, extremely low probability as this has not occured in 60 Years.
Asia has been in turmoil with the US Markets ignoring the signs from China our preferred
vector for disruption after the EU collision.
The Government shutdown can be prevented as the Votes exist, although $4.5 Trillion
in spending is going to face obstacles at a time when benefits continue to expire.
Bonds are, again, acting poorly against the FX Accident we are forecasting for
Currencies - it is frankly difficult to refer to them as such as they no longer are
given their underlying Debt Market creation is evaporating quickly.
The DX is the leader.
Those of you who are/remain regular readers know - My thesis is simple and direct with
respect to Bonds - they will not catch the "Flight to Safety Bid" as they no longer are Safe.
Instead, they will follow the Markets in a "Positive Correlatrion" to the Downside.
Yields will begin to rise again. We see the 10Yr's YCC effort abating short term and
failing intermeidate term.
Housing will suffer a correction, as Credit itself is tightening - All Credit.
The Semiconductor Supply Shortage has been played down imho, it is far more severe
than is being touted.
Q3 EPS will be an unmitigaed diasater for most of the TECH Arena, it will be comical to
observe the excuses mount. Suddenly, very suddenly, it will become REAL.
We see the Producer Price Index far exceeeding the Consumer Price Index by over 100%.
Which implies Producer are NOT passing along the majority of Price Stresses building.
In turn, the implications are HIGHER PRICES ahead, Inflation is NOT ABATING, but
accelerating.
Independent Producers are unable to compete. Most of the Restaruants I frequent have
increased their Prices 30% in a short period of time. This is a wealthy community, on balance
there is a large pool of high income earners who can afford to spend for necessities.
Average incomes among the Professional class in TECH and Services earn $400K+. A
$200 Dinner for 2 is "affordable" and keeps the decreasing number of survivors afloat,
for now.
They are YOLO Prime, it's all about the Dollars.
And speaking of the Dollar, it is tee'd up to rise as the Flight to Safety, Gold will follow
suit as well after it completes it's pattern. Equities, Bonds and Real Estate will all comply
with the Downturn.
There has been a high degree of Bond BTD for months on end, this will come to a decided
end as TLT begins to trade to 139s over the coming several months.
We see a 7, 9 to 13 week correction with the attendant "Flash Crash" panic moment where
Retail exits after the sufferage begins to weigh. This is normal, cyclical and acceptable.
It does not mean the Equities Markets will be cut in one half, we don't believe this based
upon the present projections. Breaking 3588 on the ES would, however, give us pause.
Rather, we see 4/5 completing near and between 200-400SMAs, a good panic Dip-In below
the 200SMA's to provide Fuel for new highs as the FED will, no doubt 10X down on demands
for Powell's follow-on at the FED to "Amp it up" - we call it the "make em gag for it" moment.
That is ahead and quite frankly, Long will be the Trade - imho.
5/5 will complete and that will be the end of the Longest Bull Market in History. It should
conclude in 2022. We shall see as a great deal depends upon how DEBT itself re-appears
under new arrangements Globally.
IS there a Risk we will retest the Highs?
We do not believe so, at least nothing dramatic in terms of a Retracement as they are
being SOLD Wholesale.
The Bond Markets repsonse to the FED will be instrucitve and quite llikley very disappointing
for the Buy the Bond Dip Echo Chamber.
They fail to see their own demise.
It makes a Market, for certain. We'll oppose the Long Bond Trade all day.
1.75% - 2.00% will do it. THE BOND MARKET WILL PRICE IN "INFLATION" - it is this simple.
Time - it's next week or 5 weeks for the real reaction, we believe the shorter end panic
unfolds as the waters continue to grow murky Globally. NExt's week's reaction can be
A large RT or to and through the lows, straight down.
Geopolitical Risks loom large as we have outlined, the ECB is simply done, out of bullets and
facing immense distrust within the EU. France is prepping for Bastille V.2 - the French are
becoming Militant.
CASH ($USD) will continue to be Hoarded, another strike against the Bond Complex. The hoarding
will continue to GROW.
Reverse Repos and US Treasury actions are draining Liquidity and Bond Demand has been met
witin the United States, it is Sovereigns who will see the lasrgets haricuts on their bids.
Repos are going to roll over, again, BOND Negative.
Gold - we see the pattern completing and Gold taking off to new highs. Silver will provide come
clear indications for teh strength of the move and whether the Highs are retested. Deflatioanry
forces will ulitmately have the desired effect for Gold Bugs, we are not there.
The DX can and will cause probems in the short term for GOLD.
The DX will be the flight to safety FIRST, not Gold and certainly not Silver as touted.
The Gold/Silver Gurus - for the 40+ years I have traded it, are always out over their Predition Skis,
not that they are wrong about Economic Conditions... but with respect to Hype, they are always
ahead of themselves for 44 years and counting.
Since 1977, when I began trading/accumulating Physical metals.
The same Sh_t Show... every decade. It is amazing.
On to the the ES...
We have the Death Cross, we have seen rejection take place 3 times.
50 fails, 100 fails, 200 awaits. EMAs have rolled over.
We have a failing wedge into the 1/5 around 4380 - perhaps ahead of the FED.
Wednesday or ahead of it, we would need to see a large Counter-Trend Up o the FED.
Traders need to be on guard... we can bottom out and rallying on Powell's
Meme.
Watch for the lower High for a short term reversal.
4400 to 4370 - this range can provide support SHORT TERM, which ONLY serves to
provide the LOWER LOWS into a FLASH CRASH.
OR
It can simply power down on Bond Yileds blowing up and finally pushing through the
YCC actions to 4100. 3850-3900 is KEY SUPPORT in the weekly timeframe.
We'll know as we approach the follow-thru. For now, keeping an open mind to Price
is best. VX is expanding... 35 - 40 for VIX is our overhead Objective, it can go far higher.
Anything can trade for Price, it can also DUMP far more.
They are attempting to prevent - Straight down.
Crypto - has simply been used as a Dispencery for Illegal Laundering and a large Basket for
Trading.
Regulations will do the rest.