SPX has been breaking new records the past few months.
But with inflation also breaking new records, it is not the time to relief.
As you will soon realize, SPX is not out of the storm for now.
Inflationary pressures have caused a caving in profits.
After inflation has (temporarily?) calmed, the broad market has recovered significantly.
Gold, Equities and Crypto have soared making record highs almost simultaneously.
The way these markets are growing however is highly unstable.
Curvature is one simple, straightforward way to visualize and analyze a trend.
For decades SPX has made progress by making "positive curves" that have the shape of a bear.
Now, something has changed. A massive cup is taking shape.
Such deep retracements are able to trap both bulls and bears. They leave nobody alive.
The 2022-2023 recession was caused from extensive fear in the equity market from the inflation surge. Equities increased only after inflation showed signs of cooling.
Bears got trapped in the bottom when fear maximized.
Bulls get trapped now. A multi-month stagnation will be destructive to the performance of their recent investment.
Those who feared inflation took the hardest beating.
I hope Powell is not afraid of it. And I believe he is far from afraid of it.
Zooming in one of these instances, in 1984 after Black Monday, a massive cup took shape.
After price made a record high, it stagnated for years, making slow and unstable progress.
While SPX is generally moving in steady, positive-curved trajectories, Bitcoin is the exact opposite. It suffers from unsolvable instability and deeply-negative arcs.
Many charts point us to an inflationary future. Utility companies which sell energy, water have had a desperate decade. The Post-GFC (QE) world has been full of low interest rates and low inflation. The dream of any President and FED chairman.
A bottoming in Utility coincides with what happened in 2000. Utilities confirm an incoming surge in inflationary pressure.
Inflation is what everybody is fearful of. And the performance of energy is not helping.
All of that reminds us of the '60s. SPX vs Inflation is approaching its peak.
There is little wiggle room for real profits in the equity market. Especially for the big-tech part of equities.
Big Tech (QQQ) vs SPX (IVV) has just made a quadruple top.
The entire chart is drawn inside a triangle, which could very well bearishly break down.
I have said that Powell may be not afraid of inflation.
My belief is that since the US is now exporting energy, inflation is vital for its survival.
As you can see, crude oil is breakout for importing countries. Inflation as a weapon of war.
But remember. The enemy will always try to hit back.
I watched Powell live in his testimony. For most questions he gave careful answers.
For AI he showed sincere concern on its effects on the economy.
AI could be used to affect investments, psychology and/or financial stability as an act of war.
We now have AI Financial Presenters and AI trading bots for everyone.
Let that sink in.
Maybe it is a war of weapons all over again.
Between those using weapons of instability like AI and negative-curved (unstable) growth.
And those using weapons of stability like the broad economy and inflation.
Comparing junk bonds to long-term ones, we reach at the following chart:
Yield rates suggest that they have reached a peak.
The decision may have been made. Low rates and high inflation.
Maybe the time has come, when the traditionally calm force of the FED will strengthen.
In an attempt to stabilize the US economy, they could attempt to destabilize all of its enemies.
Exporting crude oil and inflation may be a matter of survival for the US.
It could very well be the best, worst deal of the century.
Beware! Don't fight the FED!
Tread lightly, for this is highly unstable ground.
Swoosh is a trademark of Nike Inc.
Swoosh is also the sound a plane or rocket would make.
P.S. With everything human-made turning into an artificial replacement, what source should you trust? For all we know, I cannot prove I am a human writing all of that.
But with inflation also breaking new records, it is not the time to relief.
As you will soon realize, SPX is not out of the storm for now.
After inflation has (temporarily?) calmed, the broad market has recovered significantly.
Gold, Equities and Crypto have soared making record highs almost simultaneously.
The way these markets are growing however is highly unstable.
Curvature is one simple, straightforward way to visualize and analyze a trend.
For decades SPX has made progress by making "positive curves" that have the shape of a bear.
The 2022-2023 recession was caused from extensive fear in the equity market from the inflation surge. Equities increased only after inflation showed signs of cooling.
Bears got trapped in the bottom when fear maximized.
Bulls get trapped now. A multi-month stagnation will be destructive to the performance of their recent investment.
Those who feared inflation took the hardest beating.
I hope Powell is not afraid of it. And I believe he is far from afraid of it.
Zooming in one of these instances, in 1984 after Black Monday, a massive cup took shape.
After price made a record high, it stagnated for years, making slow and unstable progress.
While SPX is generally moving in steady, positive-curved trajectories, Bitcoin is the exact opposite. It suffers from unsolvable instability and deeply-negative arcs.
Many charts point us to an inflationary future. Utility companies which sell energy, water have had a desperate decade. The Post-GFC (QE) world has been full of low interest rates and low inflation. The dream of any President and FED chairman.
Inflation is what everybody is fearful of. And the performance of energy is not helping.
All of that reminds us of the '60s. SPX vs Inflation is approaching its peak.
Big Tech (QQQ) vs SPX (IVV) has just made a quadruple top.
I have said that Powell may be not afraid of inflation.
My belief is that since the US is now exporting energy, inflation is vital for its survival.
But remember. The enemy will always try to hit back.
I watched Powell live in his testimony. For most questions he gave careful answers.
For AI he showed sincere concern on its effects on the economy.
AI could be used to affect investments, psychology and/or financial stability as an act of war.
We now have AI Financial Presenters and AI trading bots for everyone.
Let that sink in.
Maybe it is a war of weapons all over again.
Between those using weapons of instability like AI and negative-curved (unstable) growth.
And those using weapons of stability like the broad economy and inflation.
Comparing junk bonds to long-term ones, we reach at the following chart:
The decision may have been made. Low rates and high inflation.
Maybe the time has come, when the traditionally calm force of the FED will strengthen.
In an attempt to stabilize the US economy, they could attempt to destabilize all of its enemies.
Exporting crude oil and inflation may be a matter of survival for the US.
It could very well be the best, worst deal of the century.
Beware! Don't fight the FED!
Tread lightly, for this is highly unstable ground.
Swoosh is a trademark of Nike Inc.
Swoosh is also the sound a plane or rocket would make.
P.S. With everything human-made turning into an artificial replacement, what source should you trust? For all we know, I cannot prove I am a human writing all of that.
Comment:
The thing about airplanes is that they move too fast.
If the equity market comes to sense, it will slow down.
Right now, with negative curvature, it seems that the market wants to go ballistic.
A plane that slows down is landing. A plane that is accelerating is going kamikaze.
The percentage of stocks above 200-day average is taking the shape of a bull flag. If this breaks to the upside, we will witness a broad acceleration in equities.
Looking like September 2020?
If the equity market comes to sense, it will slow down.
Right now, with negative curvature, it seems that the market wants to go ballistic.
A plane that slows down is landing. A plane that is accelerating is going kamikaze.
The percentage of stocks above 200-day average is taking the shape of a bull flag. If this breaks to the upside, we will witness a broad acceleration in equities.
Looking like September 2020?
Comment:
I love exotic charts and exotic girls.
An inverted (bullish) HnS has printed in SPX. Hidden in plain sight.
Comment:
Smoothing ≠ Average
Comment:
Is the yield curve about to get uninverted?
Comment:
Are you feeling that yield rates are high?
You are feeling wrong.
The 100+ year average of the US10Y ticker is 4.7%
Rates have just reached the mean after two decades of QE.
The 1998 dip was the first instance of lower-than-average rates.
You are feeling wrong.
The 100+ year average of the US10Y ticker is 4.7%
Rates have just reached the mean after two decades of QE.
The 1998 dip was the first instance of lower-than-average rates.
Comment:
Pick your favorite parabola!
AVGO or LLY ???
Which one will be in headlines next week?
AVGO or LLY ???
Which one will be in headlines next week?
Comment:
I know which is mine!
Instability at its finest. Swoosh™️ at its finest.
Comment:
The Half-Life game series is always the answer in your trading problems.
On one of the charts above I meant to say "record low utility performance".