“Vibration is fundamental; nothing is exempt from this law, it is universal, therefore applicable to every class of phenomena on the globe.” – WD Gann
“The market is rotting underneath, but big tech is driving the slow motion train wreck that is this market…
“The market is very reminiscent of February 20, 2020. That was the secondary, false high to the January 2020 primary high. One day after the secondary high of February 19, 2020, the market dropped hard and REBOUNDED. On the 3rd day following the external high of February 19, the market gapped down and all hell broke loose.”
We wrote the above in Wednesday morning’s Hit & Run Report.
We concluded, “only those who heed the market's own internal warnings, like the concrete rotting in a high-rise, will avoid the debacle.”
For the past week I’ve been ringing the bell about the significance of SPX 4356.
Tuesday’s report noted that 4356 is 66 squared, which of course is an harmonic of 666, the March 6, 2009 bear market low.
Eerily, I went on to say that, “Maybe something, maybe nothing, but the number 66 is straight across and opposition to October 29, the Big One in 1929.”
Hit and Run Members bought SPY puts. As well, we alerted that TSLA below 650 opened the door to a plunge to 600… possibly as soon as Friday.
As a friend and fellow trader said to me this morning, a parade of pundits will scramble to explain this decline.
In reality, the market has been sending the message of its pathological path for weeks.
These are the same pundits that tell us that markets don’t crash from all-time highs, that the market “always” gives a graceful exit.
But the market did not give a graceful exit in early 2020.
In sum, the market had a date with destiny culminating in a blow off 7 weeks from the May low.
This is the Gann Panic Window of 7 weeks which has called many crash lows including 1929 and 1987.
Oftentimes it nails upside crashes — the top of vertical moves.
Nothing has changed this week… except the action in the speculative leaders in EV …and the action in 10 year yields, which was crashing.
The drop in yields underpinned a pathological boost to high-tech, especially big cap high tech names like FVRR, which Hit & Run members are short from Tuesday.
The few masked the action of the many — the deterioration under the market which we’ve been warning about.
Conclusion. Today the market is vibrating off the 89th anniversary of the Great Depression low and 66 squared… 4356 SPX.
Those looking for a change in fundamentals or a headline to account for a shift in markets to warn when to sell will miss what drives markets, the Law of Vibration…between time and price.
The Square of 9 Wheel, which measures the confluence of time and price indicates that downside follow through targets a minimum drop to 4096 SPX.
