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    MarketMap™ 2024 Scenario Planner Issue#8 (sample)

    March 4, 2024

March 4, 2024

MarketMap™ 2024 Scenario Planner Issue#8 (sample)

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Ready for a blast or already plastered?

When all independent formulas for predicting the market are converging on the same space and time, something has to give way. No joke and no one seem to expect much of any change. At most the bulls would like a “… mild pullback, as it would be a healthy reset…”

Independent of the media spin which is 100% focused on AI all of the time, no one is game to point to the path progress always takes of, “create, destroy, recreate.” Everyone remains in the creative frame of mind. Yet from experience we all know what has happened to the various other technology breakout industries. After they have emerged onto the scene it becomes dog eat dog capitalism. There is an insurgence of the “copy cats,”  and the intensity of competition is not imaginary.

Just have a quick review of stock booms since 1990, from the internet, to electric vehicles easy come easy go.

I know it’s difficult to break away from the current hype but as investors, wealth managers and traders we all need to focus on what the market is saying not what the media is selling, be it network or social.

Everyone as in 90% of anyone that invest in stocks / bonds is looking for a catalyst. The reasons for the market’s change of heart are always rationalized but after the fact.

From the fundamental side the doom and gloom has not changed in decades and they will all be their pointing their finger at the Fed and saying I told you so and more than happy to accept the laurels.  Today with Bitcoin mania there is a renewed focus on a sovereign debt crisis. No one recalls the Clinton era of balanced budgets, which no one thought could happen, ever. And they have only one understanding of inflation, while there are three different kinds. Lastly they have no clue that its “confidence” that drives the markets, not voodoo economics.

All four primary elements that make up the market are colliding.
Suggesting world wide that confidence is hitting a brick wall in the first ten business days of March.

CT’s bottom line is 90% likelihood of a major change of trend (COT.) A 10% alternative is  a massive breakout aka accelerations point launching all risk assets from crude, to gold, the Dow & Co into a 1929 style blow out. Following in the footsteps of Bitcoin.

Based on everything that is known to the experienced and unknown to the i-Gens, the price of risk management just hit an all time low and will become more expensive over the remainder of the decade.

Time analysis

All different and varied methods used in the study of timing change in the markets show a major pivot late winter, early March.  Based on my fractal mapping it is calling for trends to change (COT). This pivot shows up for all the markets mapped including the USD,  gold, Bitcoin, stocks and VIX. There are many more but they all show a COT March 10 +/- three days.

Here is the 2024 mapping  on the VIX, perceived risk or fear data. The data is inverted to reflect a trend of increasing fer when the indicator is going higher. This has been one of the well known sore spots for the bears to gain any traction. Without an increasing level of fear of risk all the market accidents are bullish.

I talk about spin so my membership knows when the market is giving bullish and bearish signs. When the news is intuitively bad and the market goes up, you don’t need an EWT five count or a set of moving averages to understand you are in a bullish condition.

 

So with VIX – a measures for fear of risk, fear the market is going down,  recently its been below 20%, hence the spin is bullish, news event, accidents, will move the market higher. Whereas bears need accidents to bring on a lower market reaction, pull the bids.

MarketMap™  scenario for VIX is predicting a change in trend for this “psychological” data into one of increasing fear of market decline. As the map outlines from now into late April and May and again followed by another bout of higher volatility into the late September- October.

Where does the confidence come from for this change of trend?

When I calculate from various start points and or with various methods and critical first principles as a basis to get the same time window. This provides a high confidence forecast of when there will be change. When you couple that with price based analysis – like EWT – it is what the masters see as low to no risk new entry set up, be it long or short.

Jupiter-Uranus conjunction

No mater their field, if they use Astrology, the big event this year is Jupiter-Uranus conjunction, a 14 year cycle. The problem I see many of my friends and colleagues have is just not keeping up on their homework, relaying too much on work done years previous when we live in a dynamic universe.

I think that working over a market in isolation without any intermarket relationships at all is a major short coming plus the use of only a single discipline as the primary the lone forecasting method. Like any profession you have to keep up.

When it comes to Astro-market events its not good enough to generalize based on market action over 100 years, you have seven iterations of this Jupiter-Uranus cycle. You need to be more precise, which of the seven is more like today?

In the chart shown below you have the market from the start of this cyclical influence to its end. So instead of focusing simply on the “exact date” of the happening, and speculating about what these objects symbolize. Lets drill down on the most recent occurrence. The goal is to see the effect as it begins the advance from 6* degrees to the date when they are past 6* degrees of separation.

I know you all saw how this worked last year, which was 100% on the money. Here it is very similar.

The high pivot in 2010 leading to the flash crash in May occurred when the Jupiter-Uranus conjunction ( a 14 year cycle) started its advanced to meet-up from 6* degrees on April 23, 2010.  That was 46 days before the event itself, then Jupiter and Uranus where aligned. The featured chart provides insights into what can be expected today.

In 2024 this 14 year cycle meets up on 4/21/2024. Working back from that date by 46 days, that was the high pivot in 2010, puts the market at March 6, 2024. That early March period is the same time period the fractal mapping shows for an across markets (robust) change of trends.

There is more to like in the 2010-2011 parallelism but today – March 4, 2024 – this Astro-event is advancing to the meet up for April 21 is at a 7.5 degree separation. It will be at the same 6* degree orb as the high in 2020 this weekend the 9th of March.

So while it is true that this aspect does suffer from big time breakouts and breakdowns, as we are all witnessing Bitcoin sucking the air out of all the markets, the cycle will find the breakdown part of it as the event approaches.

The last time this cosmic event happened in the sign (month) of Taurus was 1941, a bad year from a Geo-Political point of view. Something to keep in mind.  In the past two hundred years there has been only two occurrences of this cycle as it moves through Taurus, 1941 and 1858. The later was a bear market year that made its lower high in early March (Axe-Houghton Industrial Averages.)

Shown here is the Dow chart of 1941 showing a similar pattern to the 2010 occurrences. That is with a high pivot when the cycle is 6* advancing into the date when the astrology is exact on May 8, a low pivot. Followed by a tradable rally into July – August when the cycle is past a 10* orb never to meet up again in Taurus until 2024, the 83 year cycle.

So we have front end loaded the time analysis looking at 2010 where we got the “flash crash” as a potential outcomes before summer 2024 and support for a change of trend in Dow & Co in the occurrent time window.

Market Sentiment

Market mentality is at a contrarian extreme. Sentiment from all polls and activity measures call the markets behavior extremely greedy. CNN remains at extreme greed. The front cover of “The Economist” is a well-known contrarian indicator. Some publishers are more notorious than others for being the “golden goose” of contrary indicators, but this cover is aa classic.

My review of the daily compendium of market comments remains exceedingly bullish and chuck full of braggadocio, for example. Projecting price as a Fibonacci ratio of the previous decline of the same degree has jumped in recent days from 2.618 to 3.618, “if you step back.”

Plus the normal bragging about past performance as seen here

“The S&P 500 hasn’t had a -2%pullback (on a closing basis) since its October low, gaining +23.7% over 83 trading days.” and “… that +23.7%is the largest gain for the S&P 500 without a -2% pullback in the past two decades.” They add to be fair and balanced “… it’s not the longest. In a comment to The Chart Report, David explained – “The S&P 500 went 110 days without a -2% pullback in 2017/2018, 115 days after the election in 2016, and 149 days in 2006 when the Fed stopped hiking rates.”
The publisher concludes, “The current rally is starting to defy history, but bulls should welcome a mild pullback, as it would be a healthy reset.” The media and social media will let us know when its too healthy.

Price Analysis

Technically speaking, EWT finally has a long term completed wave count. While the internal makeup of the averages has been weakening steadily since 2018 and more prominently from 2022, that only tell us there is a problem. Much like the “sovereign debt issue but market based. It’s like knowing a relative is sick with a terminal disease, that his (her) days are numbered but it does not tell you precisely when. Like all human losses, expected or not, when the market goes it will be a shock, eventually.

The top chart has the Elliott Wave count from the intra day bars showing done or nearly so.

While there may be a little more probing into virgin territory, an intermediate term top is in the making.  If the market begins to take out new support trigger points or break the low end of volatility bands, it should pick up a following of sellers, wwho have been waiting for the chance.

Internals are fair and improving some

Along with S-T momentums diverging as seen in the left hand chart above, the overall health of the markets breath has not improved to the degree to shift the bearish tide.  From an extreme overbought at the end of 2023 the numbers have been wanning. Today showing a midrange cross over.  This measure of the internals puts the bull trend on a do or die watch here. Like many species of less efficient shark this bull market must keep swimming or die. It has no choice here.

Bottom line

So while the bulls are hoping for broader market participation with the small caps to join in the fun. The market has painted itself into a timing corner, its fish or cut bait time, must swim or die.  Chatting up the social stream for a healthy 2% dip, may sound good but such a minor dip would likely turn the internals back into their down trend, renewing sell signal – of which there are already many.

No change in tactics or forecast. Focus on the old leadership for failure, the way the generals go the market will follow. The last I saw the seven had been reduced to four and now down to two.

Also, hints come from failures of old bullish habits like bullish Mondays. March 4 was a bullish failure.

From a bear’s point of view, the old bull is on its last leg and a new bear is expected at any time. A blow off is the only thing that could keep the bullish game alive. From here until March 11 is the last best chance to get see that 2% health dip before lift-off.

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Country Thinking is about letting go of traditional ways of thinking, the commonplace that no longer serves you well in investing and trading. Building from the truth, from first principles the robust into anti-fragile. Many thanks to everyone that has supported this work over the years and thanks in advance to the new members for your consideration, I look ahead to working with you for the duration.

 

 

 

Great and Many Thanks,

Jack F. Cahn, CMT

Contrary Thinker since 1989,
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