- It did not take long for retail to find out who was going to hold that bag 💰
- Covid, tech, and monetary policy in the US have conspired to create another retail frenzy ⛈
- I attempt to overlay 2015's fundamentals, technicals, and psychology to the current scenario 🏹
- Just a little observation and thought-experiment 💚
- Have fun out there!
someone is going to find that top 😬
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*monetary policy on the graph, not financial policy 😑 o*ps
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1.) Begin Graphing Scale at 2014, mid-Nov ~~~~~~~~~~~~ - period of China's retail boom-bust - boom: 7-month period - bust: 2-month period - duplicated and overlayed after Covid 2nd bounce which illustrated relative market strength - Covid stimulus has allowed this to continue but as we near the end of stimulus money it will be interesting to see how much higher SPY can go before people beginning taking profits - Because none of these profits have compounded there is a higher likelihood of mass exodus as we saw with crypto ~~~~~~~~~~~~ U.S. boom: currently at 18-months - we can see at the end of the first retail cycle (7-months) there was selling pressure from Sep-Nov as Covid-19 guidance was mixed - - From WHO timeline: - September 1 — US Rejects WHO Global COVID-19 Vaccine Effort: The United States says it will not participate in an initiative by the WHO to develop, make, and distribute a COVID-19 vaccine - September 8 — AstraZeneca Halts Phase 3 Vaccine Trial over safety concerns - September 14 — Pfizer, BioNTech Expand Phase 3 Trial - September 15 — A study published in Morbidity and Mortality Weekly Report finds that people who recently tested positive for COVID-19 were 2.4 times more likely to have dined out. - September 17 — Europe Reports Rising COVID-19 Cases - September 23 — A New, More Contagious Strain of COVID-19 Is Discovered - October 2 — Trump, First Lady Test Positive for COVID-19; Trump Enters Hospital - October 5 — Trump leaves hospital - October 8 — White House COVID-19 Outbreak Grows to 34 - October 12 — Johnson & Johnson Halts Vaccine Trial - October 19 — Global Cases Top 40 Million - October 22 — FDA Approves Remdesivir as First COVID-19 Drug - October 23 — AstraZeneca and Johnson & Johnson Announce Restart of COVID-19 Vaccine Trials - November 4 — US Reports Unprecedented 100,000 Cases in 1 Day - November 18 — Pfizer, BioNTech Vaccine Is 95% Effective - most of the news is positive from here, and most bad news is non-life-threatening for younger and healthier populations from this point on - also of note: - - the HEROES ACT (signed in MAY 2020 by the House) was left in limbo while debate between Democrats and President Trump continued until the President signed a compromised appropriations bill in December
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2.) ~~~ after all has been taken into consideration, I am just looking to find the top as everyone else.If we overlay the Chinese retail boom-bust and take into consideration other factors such as inflation, housing issues, employment #s, potential time-of-year (winter), expected end of stimulus checks, and recent news citing that 4 out of 10 Americans say their income is below pre-pandemic levels: ( www. cbsnews.com/news/fourth-stimulus- check-update-2021-08-04/ ) , we can see if there is not a 4th wave of stimulus the top of the market may come soon enough ~~~ the projected overlay is a 7:2 ratio x3 - 7 months of upward momentum - 2 months of downward momentum - equaling 21 projected upward months - and 6 projected downward months - - these are based on the most recent Chinese statistics of their 2015 boom-bust cycle which left many retail traders holding the bag
- I believe the end of the 1st 7-month period overlayed on the SPY shows a similar bust pattern that has been buyoed by US financial policy. This has allowed retail traders the chance to become heavily invested in the market, chasing ATHs. - Again, because this runup has not materialized into anything but paper profits and there is a high level of non-compounded money running around, there is a high risk of mass exits whenever things take a heavy dip. - Fed policy will probably try to hold this up, but it can only do so much in a no-interest rate world
Nice and detailed work buddy. Would you up date this idea and include all the text on the chart in the comments section of the up date i can not read it
it is kind of fixed on the chart "Unmovable". Thanks for sharing , keep up the good analysis. wish you the best.
brutusjudas
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@samitrading, thanks for letting me know, I will update 👍
stockSMASH
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Great information. US flying pig will correct following chinese selloff. Long term, a generational collapse coming. Nobody will be spared.
samitrading
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Hey buddy trying to find CSI1300 HKG, can you help me find it . Thanks in advance bud.
it is kind of fixed on the chart "Unmovable". Thanks for sharing , keep up the good analysis. wish you the best.