I really think we are at a SUBSTANTIAL TOP. Maybe one more hump up, but I DOUBT IT. Look at my charts to see amazing market symmetry in both the S&P and the Nasdaq – even though they are ENTIRELY different.
The S&P waves 1, 3 & 5 as I counted them are EQUIDISTANT – to me that spells top. The blue vertical lines are literally copies of each other – they are the same vertical size as they are – why or how would the market undo a perfect formation? The pink, purple and other color lines demonstrate the count is right because all of the corrections fit within the exact same magnitudes of each other.
The ending diagonal in the Nasdaq as I have counted it is “unparalleled” in its nearly parallel structure. And the final trend line that finally went impulsive just in time to head fake the most people – is perfectly snapped.
And the resulting moves down are impulsive, with perfect 5 wave counts at every degree.
Fundamentally – US & Global GDP are set to dip substantially (possibly an all-time record for either) – and those numbers are just coming into focus NOW for quarter 2. Earnings reports tomorrow. Massive unemployment. Data from all new sources – job websites, Uber, Lyft & other app data points, digital reporting – numbers don’t lie when they are verifiable. Coronavirus cases accelerating – 55k today. Coronavirus deaths ramping up – 1k today. US, Russia, Brazil and now India lead the way. Mass civil demonstrations still abound and could accelerate. 30% of renters may be homeless soon – severely affecting the already disadvantaged. The US President losing his mind, and the election. Election interference, voter disenfranchisement & suppression. Mass civil demonstrations in the streets. Substantial risk in commercial real estate, expected corporate bankruptcies. Unprecedented personal bankruptcies and foreclosures expected. Don’t get me wrong, I don’t necessarily think the sky is falling – at least not for a majority. The minority, however, are up the creek.
The Fed has expanded the money supply by 20 Trillion through various means, a multiple of its lending through fractional reserve banking – now with unprecedented fiscal stimulus through near socialization of not only federal treasury bonds (QE), but even corporate bonds (“not QE”), mortgage securities & overnight lending facilities – this in addition to Congress’ unparalleled release of money in to private hands.
But the Fed’s measures all lose effectiveness over time (like low rates), and you can only put so much money into the hands of the already ultra-rich before money velocity stops. And the point is these are all STOP GAP measure to stop the bleeding… and we are hemorrhaging profusely and this new money will NOT equivocate the massive contraction in our economy, and the globe’s… nor will it stop the psychological stress that MANY among us that is coming in ever-increasing intensity for the next 90 days.
I don’t know whether the correction will be an A-B-C, a near-retest of the lows (ES 2172), or if we’ll make new lows and have our first real bear market in a generation… but I do think this will be a BIG DIP.
I have an email in my drafts that I never sent, calling the top on Feb 20th to be sent to my nearest and dearest. Thanks to the bounce back nobody was ‘hurt’ – but still it’s a good reminder to raise my voice occasionally. Thanks for reading if you made it here!