Applying Fib levels to previous SPY crash levels is consistent with a level of 50 in Feb 2019.
Historic trend lines for SPY, VIX and the ratio SPY/VIX suggest SPY 50 (assuming VIX 100) in the future. Timing is estimated with fibs anchored on past crashes. A simple hedge is to buy Puts on SPY at the lowest strike (70) with a distant expiration date (Dec, 2018 is the farthest right now but these could be rolled, say, once a year)
The indicator shows $ change in NAS100 futures vs. US30 futures. The previouse trend of increasing change to NAS100 vs US30 has been broken. As US30 may be considered a safe heaven relative to the NAS100 index, the trends breakdown signifies a tipping point in terms of risk.
A 'bottom wick' can be formed on the monthly chart by having an all green/up week. When combined with the red candle at the monthly level - Creates the dynamic of a 'bottom' where the bears push price down to a limit and the bulls succeed in fighting back and bring price back up - and the bottom is formed. Looking at the weekly chart for SPX or SPY their are...
Bottom candles tend to have a lower wick. This represents the bears bringing down the price and the bulls overcoming the bears and bringing price back up. Hence the 'bottom' Last week SPY decline lacks a wick. Suggests more Down to come.
Motivation: Historical data shows how the index ratio SPY/DIA gives insight into different market phases since the Dow is more attractive when risk is high. (ref: www.crossingwallstreet.com ) Daily and intraday movements can be both described and predicted using trendlines on the SPX500 premium over the US30 in dollar terms. Specifically, the...
value seems to be transferring from bonds to gold. a long gold, short bonds position produces an attractive equity curve. The charts shows dollar value for a combined position of 3 futures: 2 long GC (gold) 1 short ZB (treasuries 30yr)
combining DOW, SPY and NAS futures can cut down on the noise. still an open question: are we rallying or not. this chart might give clarity before "one index" charts.
The gold-oil gap appears to be passing through a tipping point. A surge in the long-gold short-oil position could be due to either a gold rally, an oil dump, or both. Chart shows position using one gold future and one oil future but there exists a parallel position using ETF's.
Almost all commodities are now on the rise in a 1hr time frame. Exceptions: Steel, Copper
IYM has been perking up but metals drags it down. This suggests: Long IYM shares Short XME using options - a synthetic short (buy the puts and sell the calls - same strike) Ratio of deltas should be around 3 short XME deltas to each long IYM delta
comparing SPX500 to oil and currency futures provides insight into current trends.
be aware that both spy, treasuries (and relationship between them) is reaching critical levels in the days ahead. feel free to form your own beliefs on what happens next (at the trend lines) but DO know they are there. note: using 1/tyx in place of TLT or ZB solves the annoying discontinuity of the latter two
Relationship between Gold and Treasuries is at historical extreme. If the trend holds (we bounce), Gold is expected to do better then treasuries in the weeks ahead. Past few weeks support this idea as gold begins to outpace TLT Positive jobs data that signals a rate hike could trigger a dramatic increase in Golds price. The 10yr chart supports the timing. Gold...
A long position in SPY (or SPX500) and a short position in TLT (or ZB1!) has provided, until recently, positive returns on the daily time frame. Over the past several days, shorting both SPY and TLT together has produced better returns. TLT is expected to be highly volatile over the days ahead.