sp'weekly7a
R2K,monthly3
VIX'weekly
Summary
First...a few things I want to remind some of you...
With the failure to break back below sp'1500, In summer 2013 I waved a giant white flag.. and it wasn't until just over two weeks ago that I took my first short-index trade in over a year.
Since the morning of Sept'19th (Alibaba IPO day), when the sp'500 hit 2019.. .we've seen some increasingly wild price action. Not just the occasion 1% swing, but day after day of dynamic moves. As many are starting to also note... 'something new is occurring'.
Key aspects to support the equity bears
VIX, a weekly close above the 200 MA - last seen in 2011
VIX, a break back above the key 20 threshold
VIX, a break above the 2013 high (21.90s)
R2K, double top 1212/1213... with a break under the critical 1080 floor.
R2K, break of rising support/trend on monthly cycle, with second red 'rainbow' candle
R2K, MARCON 6, since July
Dow, negative MACD on the monthly cycle, first time since 2012
Dow, MARCON 6, since this past Monday morning.
Sp'500, MARCON 6, as of the Friday close.
*Overall equity price action is different, with increasingly wild swings, and the traditional 'buy the dip' mentality is switching to one of 'sell the rallies'.
WTIC Oil, a clear break below $90 support, breaking the giant narrowing triangle... headed to 70/60s
Copper, continuing to slip month over month... set to lose the $3s, viable low $2s
I could of course also mention various weak 'macro' data, not least in the EU, but really, I'll leave others to discuss those things right now.
So.. with all that said...
I'm calling sp'2019 a key multi-month top, with the giant wave from Oct'2011 - CONCLUDED.
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| A ray of light for the equity bears |
Is this the start of a 2007/08 crash/collapse?
No... I still don't think so. I'd guess we have another 12-18mths before a grander multi-year top is put in. Whether this is sp'2100, 2500, 3k, or even 4k (don't doubt that is not impossible)... difficult to say.
In the meantime however, I've seen more than enough to convince me that we're going to take out the sp'1900 floor... and then quickly fall into the 1700s. That should offer some great short-side trading opportunities, but also an infinitely better buying level.
Goodnight from London... the city of rainbows
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*the weekend post will be on the US monthly indexes