Gann Ni Niang
Bubbleicious indices keep marching up on regurgitation of same news... where it stops nobody knows.
Some ideas though:
1) Looks to be painting some sort of ending diagonal. I say this because to my eye it looks like the moves upward look like AB=CD patterns (green boxes) and ending diagonals are impulse waves of 3-3-3-3-3 as opposed to the typical 5-3-5-3-5.
2) Accumulation is completely flat since the demand zone at 3150. The buying fervor on low volume suggests retail buyers piling in on news of China deal, while smart money has been out since 3150.
3) Deep crab pattern in play w/ invalidation at a close above 3245 and confirmation of a daily close below 3212
4) 1/1 Gann line is critical support for current diagonal. If broken, there's little support to slow down a steep descent to the 1/2 line. It's possible the day after X-mas could be similar to last year... a complete and violent reversal going the opposite direction.
5) That said... I don't see this thing dumping prior to Xmas and until the diagonal breaks, there's little reason for bears to get excited.
6) VIX has been basing upwards as has GOLD since the china news. Daily PVSPX put volume is spiking as well, though this is not usually an indicator for a top.
Stay vigilant bears.
Some ideas though:
1) Looks to be painting some sort of ending diagonal. I say this because to my eye it looks like the moves upward look like AB=CD patterns (green boxes) and ending diagonals are impulse waves of 3-3-3-3-3 as opposed to the typical 5-3-5-3-5.
2) Accumulation is completely flat since the demand zone at 3150. The buying fervor on low volume suggests retail buyers piling in on news of China deal, while smart money has been out since 3150.
3) Deep crab pattern in play w/ invalidation at a close above 3245 and confirmation of a daily close below 3212
4) 1/1 Gann line is critical support for current diagonal. If broken, there's little support to slow down a steep descent to the 1/2 line. It's possible the day after X-mas could be similar to last year... a complete and violent reversal going the opposite direction.
5) That said... I don't see this thing dumping prior to Xmas and until the diagonal breaks, there's little reason for bears to get excited.
6) VIX has been basing upwards as has GOLD since the china news. Daily PVSPX put volume is spiking as well, though this is not usually an indicator for a top.
Stay vigilant bears.
Note
Gann and OBV trends...Note
Bounced off the 1/2 line of the small box which has been support for this ending diagonal. Exhaustion gap today looked like a blowoff top over the upper boundary of the box at 3245. A daily close above this level means it'll ponzi its way to 3270-ish. Waves (i) and (iii) were both 82 pip moves so might get a 1=3=5 for that 3270 target.If the diagonal breaks this is less likely but still possible... but given we'll see some tax deferred selling late next wk I don't see that happening. If the index stays in the box, then the 1/1 line is first target which also happens to be channel support for the entire wave. Final PT IMO is the 2/1 line in the 3020-3070 range.
Note
Bounced off 1/8 Gann line at open, but look at it... tracking the price movement of the Jan/Feb 18 top perfectly thusfar.... look out below if that neckline breaks.Note
Oops, meant to post this as an update: Saw a lot of posts today about how the uptrend was broken... I didn't see it on the linear chart. the 1/8 Gann line is a clearly defined channel and as I said this morning it bounced off of it and reacted violently upwards in the afternoon. Thursday and Friday have the potential to be ridiculously ponzibullish if the .618 retrace is broken.
Until the 1/8 channel breaks bears have little to get excited about. I might even grab some weekly calls or sell some weekly puts first thing Thursday if futures gap it up.
Note
We broke the 1/8 Gann line today (green line) during futures, but the dip buyers quickly propped it back up and we closed above it (though weakly). There was another round of repo $ injected today, which probably helped to avert a bloodbath. Apparently the potential for WW3 means a buying opportunity...Notice the red 1/1 line from the march/sep 18 tops. We bounced off that overnight... It was also the 1.236 extension from the post xmas selling so very likely we painted an expanded flat so I have little doubt they'll ponzi it up there again to close the gap from yesterday in the next week.
Catalyst day is Jan 14th, when the current round of repo money runs out and the Fed has to announce whether it will continue repo operations in Q1. Notice how the rising wedge from the 1/8 line and the top TL terminates on this date around 3300. If the Fed indicates they plan to start unwinding the balance sheet... look out below.
Again, until we get a decisive daily close below the 1/8 line, bears can afford to stay patient. I must note however that the Gann Box time interval (not shown here) is inferring a top to be put in some time mid next week in the current wave.
An interesting level to watch is 3279, which is the 2.0 extension from the July high/Aug low. If you believe the move from the Jun '16 low to Sep '18 high is a wave III, then the same 955-ish pip move from the Dec '18 low gets you to 3279.
Note
MAX pain for bulls and bears alike coming right up. Look for Fed statement about repos on Jan 14 for direction... but I think one more blowoff top is in store.Note
As expected gap from airstrike has been filled... because Iran fired missles back and didn't hit anything. Surely the 170B injected into the markets the past 2 days had nothing to do with it...I've overlaid wave 1 from the Oct 3 bottom. I'm pretty sure wave 4 is in. So if we get a wave 1=5, the sell target is the aforementioned 3279 level.
Again I believe a tapering of repo operations will be what turns this market back down. The Fed's balance sheet is now near ATHs. If you do some research you'll find that prior to every bubble top (2000, 2007) the last or next to last legs were sparked by repo facilities injecting capital. Except the current repo operations are at a much more furious and quickened pace than before... The markets are unable to wean itself off the Fed's teet, and thus has become a ticking time bomb.
Something's I'm looking for at this local top:
1) VIX has a gap to fill around 12.6
2) TSLA to 516 on the 1.618 extension
3) GOLD to head back to its 1/3 or 1/2 Gann line
Sell zone is 3279-3300.
Note
Watching 328.50-ish levels on SPY for Feb put entry today...
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.