• Background Image

    CT Journals

    stocks

July 13, 2021

Volatility Reports 7/13/21

A long-time mutual fund type said Monday there is no “bell ringer” of excessive optimism by the markets that would give a “risk-off” signal.

That in and of itself is a bell ringer because it’s not the train you see that will kill you, it’s the one you don’t see.

I’ve written in these pages that the panic pandemic sell-off was not a black swam. It was a known unknown because it was news in the public domain in 2019 hence the 19 in Covid19 yet the market in its blithering way advanced into February 19, 2020. Just like the run-up by Enron in 2000, where the news was out regarding its accounting practices, yet it climbed to all-time highs on August 23, 2000. Here again, a known unknown, what I think of as dump risk assessment.

I am sure that many will think I am simply projecting. However, a “known unknown” is the risk a person or organization is aware of but is unaware of the size and effect of the issue. As I have pointed out along with several United States Senators my advisory told my people to raise cash, gave “off risk” advice in the early part of 2021.

“Hmm, potential pandemic, what risk?”  Yet the media and the administration downplayed it for a time.

For example, my Father founded a raincoat company in the 40s “Aligator Raincoat Company,” as in the overcoat that William Faulk adorns in the Columbo TV series of the 60s, and never took off. For my Dad a rainy day was a good day, for him, drought was a risk, a known unknown regarding when, where, and how long, and so on. A known unknown risk.

Today there is a clear risk to the markets and not the ones that we all hear streaming in social media. Since the Trump election, I am more aware of the Geo-Political problems that face the markets. From the internal issues in the USA to the international issues that exist with Russian hacking to China’s competition.

Previously the following chart has been used to point out that the pros, the smart money see tail risk – which is hyper-deflation or hyper-inflation. That must see a catalyst that would cause such an extreme, as drought causing hyperinflation. The chart data on the right is making all-time historical highs along with the data from the CBOE, both suggest protecting your risk investments.

Meanwhile, the advisors to the public, many of them compete with my publications are extremely bullish. Above levels seen before the 87 crash, the dot-com peak and the 08 WFC, and others.

Investors chasing yield in junk bonds have reached an extreme of greedy action. A sign of irrational buying that is associated with major turning points. The chart used here from CNN reflects that fact. 

On top of extreme sentiment supporting the bearish expectation of a topping process is the internals of the market have providing”off risk” signals.

The 52 weak highs MA10 peaked with the initial high by the Dow & Co back in May as this featured chart clearly shows. As well as the last two peaks preceding tradable top s of the major averages.

Our “Churn and Burn” index provided Contrary Thinkers with an “off risk” warning back in March of this year and as the title implies the market has churned under the annual highs of the Dow, highlighted by the blue dots on the chart. From the most recent breakdown by the index in May and three days ago, the market has been laboring.

MarketMap High Lighting Change

When cycles have discovered that track the market’s oscillations when the data is outside the market and outside any related news you would hear or read on Fox Business or CNBC.

The following chart is based on the geo-cosmic cycle, which is part of the January Fractal membership have access at the beginning of each year.  Here however I wanted to demonstrate how it stands along provides a “ball park time window when the market is expected to make a change of trend (COT).

Below are two cross-check charts starting with the 2009 low, and the 13-year cycles. The problem with many is they may be looking for 100% bottom picking and top picking ability. Where it a matter of evidence that supports the COT from different methods; and July 12-14 is a good example. A time window associated with extreme optimism as pointed out above along with other facts.

In any event, it’s fairly easy to see how the Geo-Cosmic oscillator’s turn dates line up near the COT dates of the Dow. Imparticuallry is the high pivot in late 2015 on the Geo-cosmic date of 7/4/2015, six years from our real-time window today. Plus it was followed by a meaningful trading market where our scalping systems and long VX system were put in their environment.

 Please note the same coincidence in changes in the direction of the market near the Geo-Cosmic peak and throe dates. What is more striking is the 3/9/20 low, the November 9/20 low, and the high dated 5/13/21 that happened when the Dow and offshore major indices made ATHs. p.s. There is no such thing as a “coincident.” 

Trade-Ideas

Buy FAZ at $27.75 or better  PT = $38.5 SL = $25.5 
Contrary Thinker sees a good chance of the high-risk players getting clipped here. The Bull ETF we want to play the bear side of invests at least 80% of its net assets in financial instruments, such as swap agreements, securities of the index, and ETFs that track the index and other financial instruments that provide daily leveraged exposure to the index. Other leading high beta indices have rolled over and are trending lower. FAZ is the bear trade with 35% S-T potential and 7% risk.  FAZ is 3X Shares seek daily investment results,  300% of the inverse (or opposite), of the performance of the Russell 1000® Financial Services Index.

Direction Neutral Thinking

A concept that for many is difficult and some may see as racially based on old habits. But the market’s background, its condition is not its direction, it is how the market is trading, is it flat and sloppy, is it choppy and range-bound, is it expanding its range or is it pro-directional trending; and has that condition reached an extreme and ready for a change to something else?  It’s a powerful concept once you “get it” and it provides better risk and opportunity assessments, as well.

Back in mid-June, I reported the expectation for lower prices into the end of July, and “thus far, the action has been bearish; the Cash S&P has traced out a clear five waves down with a clearly defined 4th wave triangle, which is now forming resistance (highlighted in blue.)”

The chart on the left presented TEM signaling a rule#2 predicting a strong trend after the next trend-following or breakout trigger. Well, CT’s bias was not placated. Instead, the S&P broke out and ran to new ATHs.

I think this will provide a better understanding of the Volatility modeling I do. In that vein, the daily TEM is on a new extreme rule #3, painting the S&P’s trend as being old, feeble, persistent but due for a change.

Chance favors the Collective Mind
Here is one way to access the group, the “Volatility Reports” newsletter and MarketMap-2021 Scenario Planner, Blog access, LinkedIn private group access plus eBook on major cycles 2021-2022, and more for one low price without long-term commitments. 

Plus all of our trade ideas.

Copyright 1989-2021
Contrary Thinker 1775 E Palm Canyon Drive, Suite 110- box 176 Palm Springs, CA 92264 USA. 8006183820 or 25/1 Poinsettia Court Mooloolaba, QLD Australia 4557 614-2811-9889

— Contrary Thinker does not assume the risk of its client’s trading futures and offers no warranties expressed or implied. The opinions expressed here are my own and grounded in sources I believe to be reliable but not guaranteed.
— Pricing is subject to change without notice.  My indicators and strategies can be withdrawn for private use without notice at any time.
— Contrary Thinker does not refund policy; all sales are the finale.
Trading futures and options involve the risk of loss. Please consider carefully whether futures or options are appropriate for your financial situation. Use only risk capital when trading futures or options.

July 5, 2021

MarketMap2021 Issue #12

Brutal Reality Check Expected

If you believe in Technical Analysis, your working assumption has to be that form (the market) precedes substance (media rationalization or the extra market news). No, the market is NOT a discounting mechanism. News event – hundreds are being presented daily via social news feeds to community blogs from Zero Hedge to Seeking Alpha. Contrary to Thinker’s looks at price context and the time factor, everything else is a “Back Story,” the sizzle, not the steak.

Today social media pundits and providers of market data are in utter amazement. They have never seen their event-based analogies break so many records. The headlines are streaming ” never have we seen…”  For example, no dips quarterly, monthly, weekly, and daily exceeding all previous extremes among every observer that provides content in the social domain, but they remain optimistic. For the economic and media event-based bears, their story is the “same old same old,” with accessive debt being the primary issue and a crashing dollar and a gold rush. The bulls pointing to a reflation after the pandemic shut down will grow the market out of any problem.  The news background has not changed much over the last four years.

Overvaluation, no fiscal or monetary tools to assist in a soft landing when the next downturn happens to the competition coming from China.

The debate seems to be over inflation. Is it a problem or not, is the relation trade-off, or will it get out of hand? The messages are confusing to investors.  Here is an example:

Inflation May Have Peaked, Killing The Reflation Trade

“The reflation trade may have just died a horrible death on June 10. The CPI reading came in at 5% year-over-year, ahead of estimates for 4.7%. But despite the hotter than expected reading, bond yields continued to slide. Despite months of hotter than expected inflationary data points, bond yields have been moving lower, and breakeven inflation expectations are now plunging as well.”

Smart money is talking with their pocketbooks with a concern about either tail risk, both deflation, and hyperinflation—more on that below.

In the  LinkedIn group space, I pointed out last week how the market tipped its hand from the beginning of 2021 as irrational in the same way that it made its peak in late January 2018 and late February 2020.

I understand that many Technicians base their work on the premise that all market activity – is irrational (aka fear and greed), excluding the lone Technician. However, I have found that many technical analysts are heard, thinkers. As a rule, they are social animals. Be that as it may, my Technical Event Model (TEM) provides a clear insight into the buying and selling motivation: TEM tells me if market action is rational or emotional and when it reaches an extreme. With the irrational signals being rare on the long-term bars, they are more important when they do happen, at both tops and bottoms.

As stated from the beginning of the year, near 30,000 Dow, the buying became irrational and, on that basis, will be easy to flip as it is grounded in fear of missing out, aka greed. Hence these buyers will be guided by their account balances as they drawdown instead of a rational technical reason to be an owner.

From the start of the year – see the eBook “Time Factor” I have outlined the big cycles that have crammed themselves into this period 2021-2022, and the point they are cresting as this publication is being written over the 4th of July holiday weekend. With the background, the context of the market primed for a reversal of trend in the first six months of 2021 is now all about the critical Time Factor. The 245-248 years of the beginning of this glorious country, which by the way, is a critical returning cycle as well.

One of the primary large cycles is the 90/45 year cycle, which I will not rehash here. But there is no coincidence that when the numbers 1 through 9 are added, as in Pythagorean theory, they add up to 45 or that the 360 degrees in a circle are eight 45 degrees.

The current time window is the same as 1931-1932 and 1975-76, one period of deflation and the other of stagflation, the former left-hand tail risk, and the later right-hand tail risk.

You need to login to view the rest of the content. Please . Not a Member? Join Us
June 1, 2021

MarketMap2021 Issue #10 w/Chart Gallery

You need to login to view this content. Please . Not a Member? Join Us
June 1, 2021

Volatility Reports Crude Oil

Walking away from a winning streak is rough.

One good thing for every Contrary Thinker is that I am read and respond to comments and feedback from my traders and team.

You need to login to view the rest of the content. Please . Not a Member? Join Us
January 2, 2021

What Contrary Thinker Told its Membership

The One Factor that Trumps the New Market’s Giddiness

Published on: Jan 22, 2020: “All measures of market sentiment are at highs or extreme highs, from put/call ratios to CNN’s greed index, you name it. The outside world’s focus for this outright giddy disposition and  talk of a potential “melt-up” in equity values focuses on the following four elements…” Read it here. 

You need to login to view the rest of the content. Please . Not a Member? Join Us
December 18, 2020

On The Wings Of Tail Risk

Making Money from the Turbulence of Secular Change is 180 degrees opposed to Investing for a Long Term Average of 10%. So why take the risk of a 35% to 85% drawdown?
You need to login to view the rest of the content. Please . Not a Member? Join Us
November 5, 2020

MarketMap2021 Issue #1 the Long Cycle

THE 45-YEAR MARKET CYCLE
Some power work comes from independent scholars and academic types when it comes to isolating cycles. There are many used in text and published in trade journals most of which have a strong rationale behind them but few that show real empirical occurrences.

The long cycles are grossly overlooked for a few reasons. It’s clear the industry promotes to their own ends that timing does not work. Also, not in their interest is the long cycle does not contribute much to their transactional models.

The problem with the long cycle is it is difficult to pinpoint their exact top and the topping process can take a year or two. Just like the 2007 peak among others. Leaving aside the topping process, cycles are critical to your financial wellbeing among other things.

You need to login to view the rest of the content. Please . Not a Member? Join Us
November 3, 2020

Trump Says a Biden Win Will Crash the Stock Market. Let’s Hope So.

Not considering the thin market manipulations before the markets open to pick up a following of optimism to support the incumbent, the markets are waiting and by all internal pictures, it’s on edge.

Trump Says a Biden Win Will Crash the Stock Market. Let’s Hope So.

Evan Vucci/AP Photo

“In my neighborhood in Scranton, not a whole hell of a lot of people owned stock,’ Biden noted at last week’s CNN town hall.

Donald Trump has been falling back on a standby talking point that is more revealing that he probably knows. At last week’s ABC town hall, and repeatedly for months, he has said that a Joe Biden victory in November will cause the stock market to crash. Ordinarily, this is attached to a reference to Biden’s plan to tax the wealthy, though not always.

For someone with pretensions to being the guardian of the forgotten man and woman, appealing to them on the basis of the stock portfolios they don’t own seems misguided. The top 1 percent have half the stocks, and the top 10 percent have 84 percent of all stocks, and that percentage is rising. “In my neighborhood in Scranton, not a whole hell of a lot of people owned stock,” Biden was able to say at last week’s CNN town hall, and it was an easy way to take up the mantle of populism.

But if we scrutinize the question a little more, and ask whether a Biden victory would cause stocks to fall, we actually get at what Trump’s statement is really about: an implied threat from the capital class to make no changes to the status quo.

More from David Dayen

Generally speaking, predictions about the presidency and stock market policy are quite silly. Paul Krugman infamously predicted that markets would tank after Donald Trump won the presidency in 2016. Presidential policy can be useful for the economy, but the stock market has nothing to do with that. The market is just a means for enrichment for a thin class of investors, who are betting on expectations for future corporate profits.

Now, Biden is calling for changes to tax policy in ways that will at least create a short-term sell-off in stocks. He wants to treat capital gains and dividends as ordinary income for households above $1 million, sharply increasing the tax rate. He also would eliminate the so-called step-up in basis for capital gains, which wipes away massive increases in income for the heirs of people like David Koch when they die. Presumably, these changes, once enacted, would take effect on a certain date, and in that interim period people would sell stocks to take advantage of the lower tax rate on their capital gains, and buy them back after they’re up and running. So if Biden’s tax plan is enacted, there will be at least a mini-crash.

Biden also wants to increase the corporate tax rate from 21 percent to 28 percent, about halfway back to where it was before the Trump tax cuts. You see the pattern of who is actually affected by these changes: wealthy Americans and corporations. Like it or not, Biden’s team has vowed not to raise taxes on anyone making under $400,000 a year. Undoing the Trump tax cuts’ disproportionate benefit for the upper class and corporations actually offers a way to raise $3.8 trillion over the next decade by doing only that.

In the long run, of course, decent economic and especially public-health management in the coronavirus crisis would be the best possible outcome for the economy and the stock market. But I don’t think the investor class is thinking much about the economy, or anything other than keeping their personal party going.

Currently, the Federal Reserve is propping up asset values in stocks and other markets through a mass corporate bailout program. This has pulled the capital markets even further away from the actual economy, becoming a hermetically sealed package unto itself, a world where no coronavirus or economic struggle exists. The implication of Trump’s threat that a Biden win will crash the stock market is that any puncture of that hermetically sealed package will cause righteous anger on the part of investors.

Check, for example, the activity in options markets, where traders are hedging their bets in case of a mass sell-off in November. This has veered sharply from a month ago, as the realization of Biden’s mostly favorable electoral position has solidified. Corporations are being asked to take on more cheap debt now, in advance of the election, on the assumption of, well, a crash.

That expectation of volatility could just be due to the potential for a truly hazardous post-election period. But importantly, it’s coming from the same people who would stand to lose under Biden’s tax policy. Traders and investors would be paying the higher taxes on their activities, as would investment banks that take in high fees from the explosion of corporate bond sales. They all are effectively signaling that they will throw a tantrum in order to influence policies that would affect them. And they are actively preparing themselves with hedges to soften the blow of short-term losses that would proceed from carrying out what in some contexts you would call a capital strike.

Traders and investors, as well as investment banks, are effectively signaling that they will throw a tantrum in order to influence policies that would affect them.

You might say that stocks must go down in order to create a more equitable society, but I would pitch it this way: The economy is over-financialized, with executive performance too tied to stock performance, with corporate outcomes too reliant on financial engineering, with companies too focused on manipulating stock prices and rewarding investors rather than on creating products people want. That financialization has been built up through policy accommodations to capital. And any attempt to break that channel will trigger a furious pushback, up to and including economic sabotage.

When Trump says that Biden will crash the stock market, he’s saying that Biden will end the policy of allowing investors to use financial machinations to get rich in the Wall Street casino, and that he will ensure labor takes more of the profits. Trump might have more faith in that possibility than I do! But he’s unwittingly outlining a change that is necessary for a country that allows everyone to prosper.

The American Prospect depends on reader support

If you are scraping by right now, please don’t give us anything. But if you have the ability to support independent, non-profit journalism, we are so grateful. Your voluntary contribution helps keep this website paywall-free. You can sign up as a subscriber with a range of benefits, including an opt-in to receive the print magazine by mail.”

Click here to view the original web page at Trump Says a Biden Win Will Crash the Stock Market. Let’s Hope So.

Contrary Thinking Starts Here

Great and Many Thanks

Jack F. Cahn, CMT

Contrary Thinker since 1989,
Copyright 1989-2020

Contrary Thinker 1775 E Palm Canyon Drive, Suite 110- box 176 Palm Springs, CA
92264 USA. 760-459-4681 OR

25/1 Poinsettia Court Mooloolaba, QLD Australia 4557 614-2811-9889

— Contrary Thinker does not assume the risk of its clients trading futures and offers no warranties expressed or implied. The opinions expressed here are my own and grounded in sources I believe to be reliable but not guaranteed.

— Pricing is subject to change without notice. My indicators and strategies can be withdrawn for private use without notice, at any time.

–Trading futures and options involve the risk of loss. Please consider carefully whether futures or options are appropriate for your financial situation. Use only risk capital when trading futures or options

 

 

November 2, 2020

MarketMap2020 Issue #18

 

November 3, 2020

I know that if you have been with me for some time, I expect a significant swing high or bottom. I look for the opposite of the news media. At major highs, expect good news. A significant big swing low, the report will be dire.

This past week’s headlines were excellent: The US economy grew at a record pace in the third quarter, increasing at a 33 1/2% annual rate recovering about 2/3 of the ground lost earlier in the year due to the economic collapse from the pandemic shut down.

Moreover, most media headlines remain focused on Corona virus-related and how a double-dip recession is in the cards. That seems to be the backstory for the decline from September 2. Still, Contrary Thinker does not believe it will be blamed for the dramatic deterioration expected coming after today’s minor one day rally.

Regarding bad news, Contrary Thinker does not believe there is going to be negative news for the economy that will lower the market. Things are recovering.

Instead, the “big top” that began February 12, 2020, is the expectation of a constitutional crisis and political conflict not seen since 1860. That was our lead story on January 23, 2018, when we warned our people of the pending correction.

Today while the news media covers this potential of a disputed election, the Trump administration is threatening. Yet, the market pundits are not considering such drama impacting the markets.

Also, there is no white knight in the wings. The Federal Reserve Board has outright said that they want inflation to increase; that is a financial result, not an effect on intangible shares. The point is the Feds focused on the economy real economy, not the stock market; hence they are not going to come in to rescue the stock market during a sell-off again; their focus is on their real economy. Furthermore, not during the election season, which may drag on into January 20, 2021.

The exact reason Powell stops a return to normal is starting a new round of QE was the Trump factor, which is dead or at best dying.

Our cycle work is the same or remarkably like the setup that we had back in late March of 2020 when the market capitulated on March 23. Granted, the peak on February 12 projected its cycle for the year, which the Fed busted. But that left the work by the market left unfinished. It also begins a new Event-Based Cycle based on the Tidal high peaking with the Dow and S&P September 3, 20202.

That event-based cycle amount others calls for a downtrend into the end of the year. From November 9 into November 14, 15th show up as the more extended bar period we expected last week, including panic low. However, the POST panic low is not expected until the end of the year, at the soonest.

The same way the period from 10/23 through 10/30 saw a sustainable decline period, the next similar period runs from 11/8 through 11/14 with a panic low on 11/13 plus or minus a day. Last week Contrary Thinker expected a long bar day of greater than 4% to confirm the bear market. While it is not as likely this week, if there is a declining range day of 4% or more, it still kicks off the series of HROC decline.

I have reprinted a part of the MarketMap from March 27, 2020, to cement Contrary Thinker’s scenario going into the first quarter of 2021; and the risk of 36% plus from current recovery levels.

Decennial Theory (MarketMap-2020 Issue#6)

Issue #1 of Market Map 2020 points out the recovery of the first year of a new decade that contains the start of most year markets. Furthermore, from the year 1860, recessions have had their start all with an outside event trigger. In 1860 it was the civil war.

Year

DJIA High DJIA Low % Decline The interval from High to low Months

1890

5/17/1890 12/8/1890 -22.6 205

6.8

1900

9/5/1899 9/24/1900 -31.8 385 12.8
1910 11/19/1909 9/25/1911 -27.4 675

22.5

1920

11/3/1919 8/24/1921 -46.6 660 22.0

1930

9/3/1929 7/8/1932 -89.1 1039

34.6

1940 11/7/1940 4/28/1942 -32.5 537

17.9

1970

12/3/1968 5/26/1970 -35.9 539 18.0
1990 7/16/1990 10/11/1990 -21.2 87

2.9

2000

1/14/2000 9/21/2001 -19.9 616

20.5

2020
2020
2/12/2020
9/2/2020
Avg = 7/23/2021
Avg = 3/29/2022
Avg = -36%
527
17.6
Average w/o outliers 517

17.2

 

The above table shows the damage done in these years. I have averaged the number of profits taken – percent decline – and averaged the time spent in the bear mode throwing out the shortest and the longest.  These numbers are very much in line with all bear markets over the last 120 years.

 

Great and Many Thanks,

 

Jack F. Cahn, CMT

 

Contrary Thinker since 1989,

Copyright 1989-2020

 

Contrary Thinker 1775 E Palm Canyon Drive, Suite 110- box 176 Palm Springs, CA

92264 USA. 760-459-4681 OR

 

25/1 Poinsettia Court Mooloolaba, QLD Australia 4557 614-2811-9889

 

— Contrary Thinker does not assume the risk of its clients trading futures and offers no warranties expressed or implied. The opinions expressed here are my own and grounded in sources I believe to be reliable but not guaranteed.

 

— Pricing is subject to change without notice.  My indicators and strategies can be withdrawn for private use without notice at any time.

 

–Trading futures and options involve the risk of loss. Please consider carefully whether futures or options are appropriate for your financial situation. Use only risk capital when trading futures or options

Contrary Thinking Starts Here

Great and Many Thanks

Jack F. Cahn, CMT

Contrary Thinker since 1989,
Copyright 1989-2020

Contrary Thinker 1775 E Palm Canyon Drive, Suite 110- box 176 Palm Springs, CA
92264 USA. 760-459-4681 OR

25/1 Poinsettia Court Mooloolaba, QLD Australia 4557 614-2811-9889

— Contrary Thinker does not assume the risk of its clients trading futures and offers no warranties expressed or implied. The opinions expressed here are my own and grounded in sources I believe to be reliable but not guaranteed.

— Pricing is subject to change without notice. My indicators and strategies can be withdrawn for private use without notice, at any time.

–Trading futures and options involve the risk of loss. Please consider carefully whether futures or options are appropriate for your financial situation. Use only risk capital when trading futures or options

 

 

October 22, 2020

JP Morgan Warns Trump Can Win

Art Merrill when I interviewed him for the MTA thought that I filled a vacuum left by legends like Bolton and Gould. At the time I only had a cursory knowledge of them and today I know Arthur was a very kind man.
But as a quiet achiever – today’s Contrary Thinker – I don’t miss much. It started in 1982 based on Joe Granville’s methods I nailed the low while Joe missed it. He reminded bearish, was just not using his own work. I ticked the major top in July 1987 protected my clients and got back in during the last quarter of that year while the household name whose method was used remained dogmatically bearish, go figure.

Today!

My methods are Short Volatility ETF’s, the tide has turned. A fresh sell short signal happened with a good record projecting a down market for the next six to eight weeks. Yes, short-short volatility! If you don’t understand, it’s not too late.

Here is what no one else is seeing. Long stocks based on “implied volatility,” mathematical formulas that value all put and call option into an index, and a futures market trading it. This CBOE index and the Volatility index futures became an ETF investment vehicle that is perpetually short the futures.

Because the Volatility Index has a downward bias – the stock market is almost always going up- therefore it is a synthetic price index of the S&P or the Dow, etc.

Well, I have called the trading range since the peak of January 28, 2018, the “bull market in fear.” It is not a slur on the Perma-Bulls doing their job. Rather, this short VIX ETF has not confirmed the peaks since early 2018, thus reflecting higher prices in perceived volatility or the fear index as it is called.

When the SVXY  ETF is viewed through our Tidal Wave system the strategy is now on a new I-T sell signal (see chart). This system, when correct, is correct in a big way.  How that a sell signal is in place, a move to the recent low and below the low side of S-T support at 36.13 should get carry over targeting to the first level of the I-T support zone at 30.31. That is a risk over the next six to eight weeks of 16%. An equal move by the Dow would be a target of 23,562.00

What is most important here is why a breakdown should pick up a following, because of the background dynamics.  I did not show the weekly bar of SVXY but its TEM – our volatility model of the market dynamics- is signally an extremely tense background where frustrations will follow the direction that clearly shows its a pro-directional movement.

Another reason why from the January 2018 peak the great bull market ended and the bull market in fear began is the recent (first quarter of 2020) breakout by perceived volatility above its eight-year base. Following the breakout, the based was tested and the higher level of “fear” held, which is easy to see in Contrary Thinker’s featured chart. Furthermore, the smooth CMB index and the smooth RSI are both trending higher on our Anxiety index, suggesting that a reassertion of the first quarter spike of the market’s anxiety is imminent.

Bottom line, I-T bearish stocks worldwide, including Asia, I-T bearish bonds all ratings, bearish on gold/silver, bearish on crude oil, Bullish on the majority of commodities outside of carbon fuels, and bullish on the US dollar.  Lastly, Contrary Thinker called the peak in the bitcoin and called its break and collapse to $4,000; and I earmarked it as a leader of risk assets leading the stock market lower. That relationship has changed, it is still a risk asset and will follow the equity markets lower. More on its expected FOMO peak shortly.

Sometime in the first quarter of 2021 will be a time to gather RS leading stocks and ETFs for a rally into April/Map.  For complete details, if not a Contrary Thinker member, get your order in early for MarketMap 2021 Annual Scenario Planner, discount will end, and must be part of our LinkedIn group.

LinkedIn  Group Vistors, we appreciate your taking the time to have a review of our work, I feel we should have impressed you positively over the last two to three months. 

If you are not a Visitor at the “Volatility Reports” Group on LinkedIn, you do not qualify for this offer.

JPMorgan’s Kolanovic Has Another Warning For Those Expecting A Crushing Biden Victory

Click here to view original web page at JPMorgan’s Kolanovic Has Another Warning For Those Expecting A Crushing Biden Victory

Last week, we published an article detailing a warning from JPMorgan’s top quant Marko Kolanvoci to all those expecting a landslide Biden win (and by extension Blue Sweep) in which he showed the recent changes in voter registration data and their possible implication for state outcomes. In a nutshell, the JPM strategist found that there had been a sizable increase in Republican voter registrations in key battleground states compared to only modest increases in Democrat registrations…JP Morgan Warns Trump Can Win

The time is now. You know me, Contrary Thinket its Volatility Report, its MarketMaps-2020 and Algo Systems. All through the professional group network of LinkedIn.

LinkedIn  Group Vistors, we appreciate your taking the time to have a review of our work, I feel we should have impressed yours positively over the last two to three months. 
Take advantage of these prices available only to our network, become a Contrary Thinker today before your access runs out.

Great and Many Thanks

Jack F. Cahn, CMT

Contrary Thinker since 1989,
Copyright 1989-2020

Contrary Thinker 1775 E Palm Canyon Drive, Suite 110- box 176 Palm Springs, CA
92264 USA. 760-459-4681 OR

25/1 Poinsettia Court Mooloolaba, QLD Australia 4557 614-2811-9889

— Contrary Thinker does not assume the risk of its clients trading futures and offers no warranties expressed or implied. The opinions expressed here are my own and grounded in sources I believe to be reliable but not guaranteed.

— Pricing is subject to change without notice. My indicators and strategies can be withdrawn for private use without notice, at any time.

–Trading futures and options involve the risk of loss. Please consider carefully whether futures or options are appropriate for your financial situation. Use only risk capital when trading futures or options

error: Content is protected !!