By: Jeff Cooper
Hit and Run Morning Stock Report: March 1, 2023
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March is Going To Be A Big Deal
Today is the first trading day of the new month, March.
If the SPX trades below the February low, the Monthly Swing Chart will turn down.
That won’t be hard to do as the low for February is 3943.08 and Tuesday’s close was 3970.15.
If the Monthly Swing Chart turns down and the SPX follows through, there is a strong likelihood that a drop to the low 3600 region is on the table. That is the June low and ties to the 50 month moving average.
If that plays out, it will amount to a roughly 10% decline.
I think there is a strong likelihood that if we get downside momentum,that that kind of drop could take place before March is over, based on cycles.
For example, this March is the 20 year cycle anniversary of the important March 2003 low.
Downside momentum will also see breakage below the close-only trend line connecting the October low for last year and the December closing low shown in yesterday’s report.
As well the very short-term cycles zero in on the March 22 time frame as this is 90 days/degrees from the December 22 low.
As tweeted today, cycles can always invert and March could carve out a high but I think it is more likely to be a low.
Hit and Run backed up that thesis by buying March monthly 395 SPY puts yesterday.
If I am correct they will be a 4 bagger.
The market tried to rally on Tuesday but once again, like Monday, relinquished the gains, closing near session lows.
We said that if we took out Monday’s overnight lows around 3975 it was trouble and we did.
We now have two closes below the SPX 50 day moving average, the second ostensibly serving to validate the first.
This price action is occurring at the key 3980 Maginot Line… a backtest of the breakout of the Bear Line of Most Resistance that was cleared in January.
Downside follow-through opens the door to last-ditch key support at the 200 day moving average, 3940ish.
This is the key level to pay attention to in the short run.
If the SPX closes decisively below 3940, support evaporates which could perpetuate a waterfall decline.
A word about March.
March 24 will be the 23rd anniversary of the Bubble Top in 2000.
From that top the NAZ had a decline that echoed the devastation of the DJIA after the 1929 top… some SEVENTY years earlier.
On the Square of 9 Wheel, the number 23 is square March 23/24.
So this anniversary looks like a big deal.
As you know, markets play out in threes.
March 23, 2023 will be the THIRD anniversary of the Covid Crash low.
Three years is 1080 degrees/days. (360 X 3),
Some believe that 108 is the key to Gann’s Time methods.
We know that 540 degrees is a true square, a cube. This is because a 3 dimensional square has 6 sides of 90 degrees each equaling 540 degrees.
So two cubes is 1080 degrees or three cycles of 360.
2 and 3 are the building blocks for the Fibonacci sequence.
Leonardo Fibonacci wrote that the number 109 has a way of representing the wholeness of existence.
The radius of the moon is 1080 miles.
Many of Gann’s cycles revolved around the moon.
If you draw a 2 dimensional square and place the corner of another square in the center of the first and connect the corners you get a cube. This is the synergy of 2 and 3.
2 and 3 = 5. This is the trinity of Sacred Geometry.
Gann was a student of the Bible and believe that man was created in God’s image.
Take your TWO hands and place them in front of you.
You have TWO hands, FIVE fingers on each and each finger is divided into THREE segments.
2, 3, 5.
The square root of 2 is 1.414.
The square root of 3 is 1.732
1.414 + 1.732 = 3.14 or Pi.
The square root of 5 = 2.236
2.236 + 1.414 = 3.65.
Move the decimal point and you have the number of days in the year.
This is why the Square of 9 Wheel works.
Because natural progression is not a straight line but a logarithmic sequence or spiral.
So the 23 (2 + 3) anniversary of the Primary Bull Market top on March 24, 2000 should be a big deal.