By: Jeff Cooper
Hit and Run Trading Morning Report - February 22, 2024
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The Emperor’s New Clothes
“It seems years since you held the baby
While I wrecked the bedroom.”
-Sinead O’Connor, The Emperor’s New Clothes
Now we know why the market rallied in the last half hour on Wednesday.
Don’t we.
You think someone knew about the NVDA print?
How about the initial drop in NVDA after reporting?
Apparently there was a “miscommunication”.
Was it Miss Direction?
Or was it just part of a NVDA Cha Cha Cha.
So this is the 2nd ‘Cha’.
The 3rd should be a down leg. Ultimately. Not today.
Below we’ll tell you where and when that sets up.
But before we go into that a look at the SPX.
Earlier this week we show two charts (one arithmetic, the other logarithmic) with projections marginally above the 5048 SPX peak on Feb 12.
Remember 5048 is the closing NAZ high in early March 2000.
The intraday high was 5150 region.
If a new high is scored we have to be mindful of the possibility of a Soup Nazi sell signal
This would occur on a reversal that sticks back below the 5048 Feb 12 high.
To recap a Soup Nazi sell signal is a new 20 day high that reverses back thru the high of at least 4 days prior within the 20 day lookback.
Ie, a false breakout. “No Soup For You.”
That’s speculation on my part, but calculated speculation.
Here’s why.
We’ve spoken about 7 being the number of time and the number of panic before.
From the October 13 2022 low to February 15, 2024 is 490 days or 7 squared and moving the decimal point.
From the January 2022 peak to July 2023 is 540 days, a cube, 18 months.
From the Oct 2022 low to April 2024 is 18 months.
April of course is the second Great American Eclipse.
The first one in August 2017 started the melt up that ended in late January/Feb 2018.
It ended with a flash crash in February.
I can’t help but wonder if there’s not a mirror image fold-back in progress.
In other words is it possible the April 8 eclipse will mark a melt-down?...since we’ve already been in a manic move since November, 5 months.
Interestingly from the August 2017 Great American Eclipse to the January 2018 high was you guess it 5 months.
There’s something about April.
This year we are 95 years from the 1929 crash.
95 is square April 3rd.
If this NVDA surge sparks a run to the aforesaid 5150 region there is some interesting synchronicity that ties to early March.
March 10 was the Bubble Top in 2000.
When the Emperor was CSCO.
March 6 was the bear market bottom in 2009.
Can the market stay spicy into March?
NVDA bottomed at 108 in 2022.
The Feb 12 high which ties to the SPX high was 746.
108 is opposite 746.
They align/vibrate off early March.
862 is another 360 degrees up from the prior 746 high which is being eclipsed this morning.
Is NVDA, the MARKET.
I don’t know--- was RCA the market in the Roaring Twenties.
Yes it was the Apple of the market’s eye.
More people lost money buying RCA on the way down after the crash in 1929 than they did in the crash itself.
They were looking for the Emperor’s New Clothes.
So while a new all-time SPX high looks a certainty, a chart of the top 10% of stocks versus the entire US stock market does not tell a nifty story.
This push to a new high equates to 1929.
Remember the majority of stocks topped in 1928.
The run for the roses was driven by a nifty few.
Speaking of 1929.
Will it be another a case of the Emperor’s Hand Me Downs?