November 21, 2022
VIX data does not suggest the daily wide swings in the stock market. Over the last 30 days, S&P 500’s minimum gain on an up day is 2% (rounded).
What the data reflects is more precise than the widely used put/call ratio. Today that statistic is just not a bear/bull ratio because there can be calls on leveraged bear (short) ETFs. Even if they have made changes in the ratio calculation, it is thought to reflect the mentality of risk-averse risk-takers compared to futures traders, as such it is the little guy that is assumed to be dumb money.
Well, the data used in Contrary Thinker’s fear and greed oscillator is more than the current perception of risk in the stock market today, looking out at various lengths. We also use the UVXY and others, which is a portfolio of S-T volatility futures. UVXY is ProShares Ultra VIX Short Term Futures ETF, long volatility futures. For a hedge fund, the cost of carrying a hedge is the value of that portfolio decreasing.
From an Alpha-achieving point of view, it is the process of moving to long volatility, that achieves Alpha, not the longer term carrying the position. The index has a slow-down trending bias because the stock market is known to be bullish most of the time. However, the index spikes to higher levels. Today the low 20% range suggests these investors see little risk of a volatility breakout. So, on the other hand an uptrend in the index is more like a spike leading the stock market. Back when Covid19 made the mainstream media the index spike to over .85.
With that in mind, a bear market always has
November 14, 2022
“The US Securities and Exchange Commission and the Justice Department now investigating, remains of FTX “
Bill Clinton’s Treasury Secretary Larry Summers making Enron comparisons
Back Story Contagion from the Crypto
THE WOLF STREET REPORT: Where’s the Contagion from the Crypto Implosion?
Here is a sample of the headlines.
The fix is in, there is only one Intermarket relationship that matters to the bulls and that is the USD against the world equity markets. While all eyes are on the dollar staying below its breakdown point, other relationships are being overlooked by the majority. For example, the inversion of long-term rates with the shorter-term.
Their study of the dollar relations is cited at best, looking back at 2017 as their model that says “when the bastion of safety is down” its risk on for stocks. Their research is front-end loaded. They forget the dollar bear in 2008 along with the world financial crisis or the dollar bull during the neo-liberal Clinton stock bull market.
Inter-market relationships, come and go. But this one has set up an influx of a liquidity pool for the smart money and big money to sell into.
So the news is good, inflation is under control, the Feds are going to pivot, and the dollar is “risk on.” Now it is all clear, the game is the bulls to lose. They have all the analogies backing them up. They even pulled out the old Philly A’s trick, because if the Phillies had won the world series it would be a bearish omen, dead set. But they did not mention that an original NFL team, the LA Rams, won the Super Bowl as crème de la crème of bullish analogs. I guess they remembered the G-men beat the Pats in 2008, a nasty exception.
So what can go wrong? “All you need to know. $UUP $DXY $USD” if you listen to the public stream?
“…One of the biggest developments this week was the breakdown in the US Dollar. The US Dollar Index dropped 4% this week, marking the worst week since 2009… that broke the uptrend line that has been in place for the majority of 2022. The strength in the US Dollar has been putting pressure on stocks and risk assets all year, so this is exactly what the bulls have been waiting for. “
Here is CT’s chart of the US dollar index showing the ruler trend line everyone is excited about its break. However, the long-term and intermediate-term trends are up; and the best the bulls can hope for in the “USD indicator vacuum” is a high-level trading range from 104 to 114.
November 9, 2022
“Time changes everything except something human which is always surprised by change”
Since the correlation has caused a big stir in the financial networks, everyone sees the 1-to-1 relationship between the USD and the ten-year notes as having a negative relationship with all risky investments. After one fella about creamed in his pants with the excitement regarding the discovery and the desire to go back to 2017 the question remains “what are they going to do and how are they going to know when it changes?
October 31, 2022
All the talk is about the profit season from now until the end of May, before summer vacation. Hence the cliche is to sell stocks in May and buy them back in October.
My system development firm Thinking Man’s Trader (TMT) programmed that idea and tested it and since the 1920s on the Dow, it works. The drawdowns are larger than most want to endure, but in general, it works.
Be that as it may, here is a small sampling of the content regarding this seasonal factor.
“The next six months have been higher 18 of the past 18 times during a midterm year. Yes, things have been tough this year so far, but be open to better times. What happened in the rearview mirror doesn’t mean it’ll happen again.” From a broker that appears on CNBC.
“Of the 11 S&P 500 Sectors. 8 are now above their June lows. ” From a CPA?
“This is the 4th time in 2022 that $SPX rallied 7% or more in only 9 sessions. How are we feeling about this one? 4th time the charm?” A CMT.
“$SPY $IWM +8% this month” from a CFA chasing the equity curve.
“We’re at a point in the calendar where $SPX returns tend to have a clear upward bias, but that bias is further enhanced when sentiment is overly bearish. One of the risks is that offsides positioning develops into FOMO as the year draws to a close.” A Research Firm
The sentiment remains bullish and bearish on bonds and not much talk about commodities.
Well chatting with a number of bulls in the public space they all believe that the market has experienced a bear market, which is over. While my expectation is the bear is not over but thus far, it has not been confirmed. Like everything that makes TMA rough for the many, by the price and time comes that the bear is confirmed, it will be too late for the perma-bulls.
I put it this way, “From the ATH the decline has only been a correction, not a bear market. There is more to a bear than a 21% decline with the average time from high to low. The nature of a bear is very clear and undeniable, and what has unfolded thus far is not a bear market, maybe the bull’s egos are a little touchy. They are certainly defensive worrying about their jobs. But so far, not a bear market, it is a ‘bull market in fear.'”
October 3, 2022
September 29, 2022
Sizzle or Fizzle?
I never thought a headline phased as a question was a good way to introduce a news article or a research brief. A question reflects doubt, and I think readers want answers, not more questions. Be that as it is this morning, our pals at the “Seeking Alpha” mailer is headed up with that query, which I assume reflects the doubt permeating the gaggle of content-providing market observers.
Tie that in with other mainstays of the personalities on financial networks which have either given into bearish notions with observations that “late cycle” economic events are happening that preclude the beginning of a new bull market, or the manic sales type permeating the podcast airways and popping up on Fox business who has gone nuts over the revelation that he has found a relationship between Cryptocurrencies – the stock market and the US dollar. “if the USD would break below 103 it be like 2017.” If not it’s the bear city.
Well ok then, that ties into the notion of a breakdown finally after nine months of correction is the fact that the perma-bulls are giving in. Both on social media and cable channels and it’s time to run with the herd.
Well, let’s start with what we know, we know that a bear market while larger than corrections, still corrects something.
The people at Charles Swabb put it this way, “It’s called a correction because historically the drop often “corrects” and returns prices to their longer-term trend. Is It the Start of a Bear Market?
Well according to the compliant sell side phrase “Nobody can predict with any degree of certainty whether a correction will reverse or turn into a bear market.”
On the contrary, there is a risk in the market from here of 10,000 Dow points and it is correcting the FOMO buying that pushed prices into their ATHs at the end of 2021.
The featured chart here is annotated for anyone in the public domain to review. Members already have seen the additional details on how the Dow will get there when it will get there, and the why of the risk assessment.
With a high degree of certainty in Mid-May 2011 Contrary thinker told its people “off risk.” and this has not changed since that date. You will not hear anyone disputing this fact.
We suggested to our people to sell into rallies and hedge their accounts.
Contrary Thinker was provided the opportunity of a private channel on the Smartphone app “Trade Exchange” and we took it. Our market opinions and positions are our own and do not reflect the opinion of any of the principles of Trade Exchange, while we hope that they have made millions from the ideas
(click to enlarge)
With that said, from the ATH that we called in the NASDAQ on 11/19/21 our middle-risk big swing ETF bull and the bear trading products to date performance is on the left on the screen grab here.
For investors, hedge fund managers who want to reduce their cost of carrying the hedges, deep-in-the-money options traders, and aggressive traders who swing trade the futures here is how our trade ideas have done on a 100k account from November 2021
In the past 11 months, Contrary Thinker’s trade ideas on 100k made it into over $1 million USD today.
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Trade Ideas? We do things the old fashion way. Contrary thinker provides support and market analysis to form the basis of the trades and get that to our informed membership and LinkedIn private group members.
You are dealing with a team led by a veteran with over 30 years of experience and suggest that if you are not experienced and have a low threshold for account balance changes, you look elsewhere. If you can take a loss, all you have to do is get the app, pay me $10/month, and after that a nominal incentive fee only on winners greater than a preset threshold. I have to win for you to make money.
On Shore USA, yes? Use this URL https://tradeexchange.app.link/jack_cahn
Offshore go to your local app store and get the free Trade Exchange App, after installing it on your handheld, use the URL from your handheld device. https://tradeexchange.app.link/jack_cahn
Let me know when you are on board, so I can get you into the group.
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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. Thanks in advance for your consideration, I look ahead to working with you for the duration.
Great and Many Thanks
Jack F. Cahn, CMT
Contrary Thinker 1775 E Palm Canyon Drive, Suite 110- box 176 Palm Springs, CA 92264 USA. 800-618-3820 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.
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September 28, 2022
Context Gives Significance to Price and Time
The long-term background remains in an expanding monthly range condition,. Hence a breakdown to new lows would suggest a
September 15, 2022
When you have the enemy on the run, in retreat, you must pursue them relentlessly.
Volatility means big swings up and down. The news media has picked up that word as its euphemism for a market decline. However, it is volatility that is the trader’s live blood as opposed to the lack thereof for the bull-only long-term investors that simply buy and hold.
If you have looked at enough daily bar charts with the 200-day simple moving average you will see that when prices are above it, the changeability of the market is low, it’s steady as she goes. However, once the market drops below the 200 day that is where all the action is for traders.
This featured chart provides a textbook example of what two very different long-term opportunities look like. The stats that are always quoted are from the 1950s,stating: “the S&P 500 has fallen >4% in a long bar 55 times. 49 of those times happened beneath the 200-day MA. As you can see, before 1950 the same truth applied, as 90% plus of all long bar days happen beneath the 200-day.
This Macro change in the context of the market dictates if one invests or trades (both long and short). If you are so indelibly programmed to think only in terms of investing, the next ten to twenty years will be a depression for you.
MarketMap’s primary cycle chart suggests the next meaningful low,
August 28, 2022
Contrary Thinker’s headline two weeks back said something like “the bulls were getting ready for an island vacation.” Well, they got what they may not have expected (See Nasdaq chart.)
Either way I look at the market, from the ground up or from the top down, Dow & Co. does not look well. From an Elliott Wave point of view – the theory everyone loves to hate – the intraday bar on all the majors is a clear bearish pattern. A nominal five wave count, calling the larger trend lower.
I will let the coming issue of MarketMap discuss the time window to expect a change, the long 1,000-point decline on the down produced the most radical downside momentum. A situation is more typical of the middle of a move, not the end of one.
On the right-hand side are textbook examples of an Elliott wave count, pointing out that only one of the three motive waves can be extended, while the other two are similar in length. If we take EWT in isolation the suggestion is a 3rd wave extension is unfolding now and there should be immediate carry-over near the open in New York, or as soon as the overnight globex.
Volatility Model (the Technical Event Model TEM)
The four major cash indices shown here have near identical backgrounds working off an expected period of range expansion calls Technical Event #4. As a rule, it means “trade the break.” From left to right the Dow had a breakdown below intermediate Support, the S&P broke down below our smooth Bollinger Band, The Nasdaq Composite broke below its Short term (S-T) support zone and the Rusell’s moving averages touched off to hight light its reversal. In effect, the four indicators are inter-changeable last Friday and all gave the same message, sell on an S-T and Intermediate-term (I-T) basis.
TEM on the close is not near a new extreme suggesting a change of trend. P.S the blue highlight on the Nasdaq chart depicts a bearish island reversal.
Compounding the worries
August 15, 2022
Based on the confusion propagated between politics and the rule of law taking advantage of an uneducated electorate,
What will the civil war look like?
Man Crashes Car Into Capitol Barricade, Opens Fire, And Kills Himself
A man drove his car into a barricade at the US Capitol early Sunday morning and, as it burst into flame, he exited the vehicle and began “indiscriminately” shooting a handgun. As US Capitol police approached him, he shot himself to death.
According to a statement issued by Capitol Police:
Just after 4:00 a.m., a man drove his car into the vehicle barricade at East Capitol Street and Second Street. While the man was getting out of the car, it became engulfed in flames.
“It appears that the individual may have started the fire himself as he was getting out of the car,” said Capitol Police chief Tom Manger at a Sunday morning press conference. He described the attacker as firing a handgun “indiscriminately.”
Five US States Will Decide If the 2024 Election Can Be Stolen
Politicians who dispute the outcome of the 2020 presidential election are on the ballot this year for offices that could determine how the 2024 election is decided in swing states—regardless of what voters intend.
Donald Trump’s effort to overturn his 2020 election loss to Joe Biden failed, but his loyalists have never stopped trying to turn the US election system into one that would return him to the White House in 2024—fairly or otherwise.
In the last two years, Republicans have sought to remove state officials who wouldn’t manufacture votes and falsely declare him the winner. They changed the way elections are run in response to his conspiracy theories. Most importantly, they’ve nominated people who insist Trump won as candidates for US Congress and governor, and for offices that certify the outcome.
The want to be usurper are from left to right
Tudor Dixon Governor nominee Michigan
“Steal an election then hide behind calls for unity and leftists lap it up.” Detroit Free Press
Dixon repeatedly tweeted that the 2020 election was stolen and accused Democrats of “obvious” and “sloppy” voter fraud.
Doug Mastriano Governor nominee Pennsylvania
“There is mounting evidence that the PA presidential election was compromised.”
As a state senator, Mastriano held his own hearings on the 2020 election, privately lobbied the Justice Department to investigate fraud claims, attended Trump’s Jan. 6 rally on the Ellipse and briefly led a partisan review of the results.
Kari Lake Governor nominee Arizona
“America knows the 2020 election was stolen. America knows President Trump was the true winner.”
Lake has claimed that Democrats stole the election and said she would not have certified Arizona if she had been governor in 2020.
Adam Laxalt US Senator nominee Nevada
“There’s no question they rigged the election.”
A former Nevada attorney general, Laxalt filed several lawsuits seeking to overturn the 2020 election and made baseless claims of widespread voter fraud. As a senator, he would be in a position to vote against certifying the election.
Tim Michels Governor nominee Wisconsin
“Certainly, there was a lot of bad stuff that happened. There was certainly illegal ballots. How many? … I don’t know if anybody knows.”
Milwaukee Journal Sentinel
Michels has said “no one knows” how much fraud there was in 2020 and that “maybe” the election was stolen and wouldn’t say whether he would certify the 2024 election if he is governor.
Former FBI Assistant Director Says ‘Handful In Leadership’ Are Politicizing Bureau, Following Mar-a-Lago Raid
Authored by Scott Wheeler via The Epoch Times (emphasis ours),
Years of investigations have led to claims by Republicans of partisan political power plays at the Federal Bureau of Investigation and Department of Justice.
A raid on former President Donald Trump’s home on Aug. 8 has sharpened the nation’s focus on what many Republicans have been raising alarms about for years—the politicization of the Justice Department (DOJ) and its law enforcement arm, the Federal Bureau of Investigation (FBI). Republican U.S. Senator Charles Grassley of Iowa has been demanding answers about alleged politicization well before the raid.
“Unfortunately, a growing number of Americans have lost confidence in the bureau based on its inconsistent handling of politically sensitive investigations, its lack of cooperation with legitimate congressional oversight inquiries, and its failure to hold its own people accountable for their misconduct,” Grassley told The Epoch Times.
Similar Cases Involving Democrats
In 2015, former Secretary of State and presidential candidate Hillary Clinton came under FBI investigation for concealing classified information on an unauthorized email server she kept at her home. During that investigation, Clinton deleted emails that were under subpoena. The FBI, which was in charge of the investigation of Clinton, did not conduct raids at any time and allowed Clinton and her attorneys to negotiate what evidence Clinton would turn over to the bureau and dictate the terms in which Clinton would be interviewed.
Donald Trump’s Mar-a-Lago was a ‘nightmare’ environment for housing classified documents, experts say
The seizure of classified US government documents from Donald Trump’s sprawling Mar-a-Lago retreat spotlights the ongoing national security concerns presented by the former president and the home he dubbed the Winter White House.
- The FBI seized 11 sets of classified information from the property, revealing an investigation into Mr Trump for possible violations of the Espionage Act and several other lawsMr Trump is under federal investigation for possible violations of the Espionage Act, which makes it unlawful to spy for another country or mishandle US defence information.As president, Mr Trump sometimes shared information, regardless of its sensitivity.Early in his presidency, he spontaneously gave highly classified information to Russia’s foreign minister about a planned Islamic State operation while he was in the Oval Office, US officials said at the time.But it was at Mar-a-Lago that US intelligence seemed especially at risk.The mansion and private-members club located in Palm Beach County in Florida was Mr Trump’s luxurious winter home.Read More: Click here to view original web page at Donald Trump’s Mar-a-Lago was a ‘nightmare’ environment for housing classified documents, experts say
Media, Democrats Admit They Expect The FBI’s Trump Raid To Bait People Into Violence
The left would love for conservatives to succumb to violence. Don’t take the bait.
The FBI and media narrative in the days after the FBI’s unprecedented raid on the home of a former president and opposition party leader was one of feigned surprise that such authoritarian tactics would prompt any outrage. Simultaneously, however, media and Democrat figures used the raid to project their expectations of a violent reaction onto their political opponents.
The right’s outrage over yet another high-profile example of federal intelligence agencies applying double standards to Democrats’ political opponents was quickly exploited by corrupt actors such as MSNBC to accuse conservatives like YouTuber Steven Crowder of trying to “agitate for ‘civil war’” with a tweet on the night of the raid.
Crowder clearly meant that as a metaphoric war, something his crew explained shortly after MSNBC trashed him on-air and in an article. But that hasn’t stopped the press and Democrats from egging conservatives, shocked at the politicization of the DOJ and FBI, toward violence — which the former would use like the Jan. 6, 2021, riot to once again punish people on the right far more severely than they punish people on the left for the same infractions.
Leftists consistently use allegations of political violence — whether real fringe violence or the imagined “violence” of free speech — as an excuse to target their enemies. So it’s no surprise that their focus regarding the FBI’s action is not on the fact that unelected bureaucrats rifled through the Republican Party leader’s personal items for more than nine hours without explaining themselves, but that conservatives’ reaction to the abuse of power could include violence.
The truth is, leftists and their cronies in the corrupt corporate media are doing their best to provoke that kind of violence with precisely these outrageous tactics, hoping some MAGA hat-wearing conservatives will do something illegal or something that can be framed as illegal in response to the raid so they are eligible for swift and drastic punishment
That’s why the Washington Post published an article on Wednesday claiming that “GOP hysteria over the Mar-a-Lago search is an invitation to violence.” In the article, Dana Milbank, the WaPo opinion columnist infamous for demanding everyone “give Biden a break,” said “violent speech” like calling for the disbandment of the “tyrannical FBI” will lead to “violent acts.”
The J6 show trial didn’t change the minds of many Americans, but it gave swamp creatures such as Attorney General Merrick Garland and FBI Director Christopher Wray the excuses they needed to take down Trump and stop him from running for president again. In the case of Jan. 6, Democrats saw an opportunity to exploit the condemnable actions of a few to incriminate a whole ideology and political party.
The Mar-a-Lago raid is no different.
“If you believe this [raid] is about classified documents, having to do with bullsh-t Trump took with him when he left office, your head is in the sky. This is about Jan. 6 and the never-ending desire to get Donald Trump on something,” Megyn Kelly said in a recent episode of “The Megyn Kelly Show.”
Trump Can’t Envision a Government Less Corrupt Than He Is
After FBI agents finished executing a lawful warrant at his Mar-a-Lago property in Florida, Donald Trump made an accusation that was astonishing in its lack of self-awareness, even for him. He said in a statement: “They even broke into my safe! What is the difference between this and Watergate, where operatives broke into the Democrat National Committee?”
The difference hardly needs explaining, of course. The goons who broke into the DNC headquarters in 1972 may or may not have done so illegally at Nixon’s personal behest. However, after a couple of weeks, the president’s stooges were engaged in a historic criminal conspiracy following the boss’s orders. The DNC of that era was not involved in illegal activity nor suspected of such. On the other hand, Donald Trump is under investigation by multiple law enforcement agencies for myriad crimes. A judge was impressed enough by the evidence to grant an extraordinary warrant for the contents of Trump’s safe. It’s worth noting that the FBI Director who most assuredly signed off the warrant request is a Trump appointee, and we know the Attorney General did.
Special Ops Veteran Cancels Plans For Sunday Protest At FBI Headquarters After ‘Trap’ Warnings
Authored by Patricia Tolson via The Epoch Times (emphasis ours),
In the wake of the unexpected fallout sparked by an Aug. 8 media pitch, a military veteran has revised his plans to hold a protest at the FBI headquarters in Washington on Sunday, Aug. 14.
Following the unprecedented raid on the Mar-a-Lago residence of former President Donald Trump, an Aug. 8 media pitch announced that a 20-year military and former Special Ops veteran named Adam Hardage was “calling on fellow veterans and Americans of all walks to join him Sunday 8/14 at the FBI HQ in Washington DC to protest the out of control FBI and its actions against President Trump.”
However, the unexpected fallout that quickly ensued caused Hardage to revise his plans.
It all started with an Aug. 9 report about the proposed protest mentioned in the Aug. 8 media pitch.
The contact information was included in the media pitch for those who wanted to interview Hardage. While Hardage did receive requests for radio and podcast spots, the media relations company that sent out the media pitch confirmed that The Epoch Times was the only print/web news outlet to actually request and receive an interview with Hardage about his proposed protest.
Contrary Thinker is just not the market analyst for the professional advisors, managers, and traders. It is a journalist that digs into the real-life reasons behind the rumblings.
MarketMap™-2018 Issue #1 1/18/18
You wait, you will pay more.
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