If you follow my research, be prepared for an immediate downside rotation starting near March 5th ~ 11th that will likely result in a -5~8% downside price swing. This will NOT be the massive crash that so many other people are predicting. It will likely end as a momentum base setup near the -6% levels that I'm suggesting for the ES and YM. The NQ will likely rotate a bit further to the downside (possibly -8 to -12%).
If you have not already protected your long positions, DO IT NOW. Be prepared for a mild price rotation before the next momentum move begins near early April 2019.
Follow my work if you want to stay ahead of these markets.
Brad great call. I notice the 2015-2016 base formed the flag of a bull flag on the monthly time frame, and it looks like, and I believe you mentioned this as well, the trading of 2017 and 2018 built a flag- and the beginnings of a pennant shape, bounded from the September 2018 highs to the December 2018 lows. My question is, do you think for the majority of 2019 we will stay within that pennant and new highs will approach toward the end of 2019 / early 2020, or do you think it is more likely on a sooner horizon?
BradMatheny
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@vergun, Thank you. I'm happy you continue to follow my research. I believe the current rotation in the US majors will setup a new downward pennant formation that will, eventually, breakout to the upside. My expectations are that the 3rd a 4th quarters will see a huge influx of capital from foreign investors. I believe a large capital shift is taking place and capital is moving into US Blue Chips and Mid-Caps. I believe this will become even more evident in the 3rd and 4th quarters. In the mean time, we have to take advantage of this rotation because this may become one of the best buying opportunities of the next 3+ years.
vergun
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@BradMatheny, sounds good. Please keep me posted. I'd be interested in participating, even if it's a Discord group. I am a programmer also working on trading systems, so I'm also interested in the adaptive learning model for price prediction and comparing notes.
Also one question, is there a specific criteria you use for selecting the diameter of your fib circles?
gvoommen
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Didn't you say it was going to an all time high in your last post...:)
BradMatheny
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@gvoommen, After this little rotation downward, yes, it will rally much higher. Price always operates in a mode of "price exploration". All of Fibonacci theory is based on this concept. Price MUST rotate, or create waves, in order to advance or decline - it is part of the mechanics of price theory.