This Is A Big Week In the Market


Let’s recap a little before we get to the current market.

December 20, 2021 Hit & Run Report: Sign of the Bear

“For over a month, we’ve been sounding the alarm about the weakest market internals ever at an ATH. Few technicians and traders have been discussing the alarming internal weakness in the market structure.

Specifically, I am referring to market internals at new year highs and new yearly lows.

There have been only 3 specific periods when the new daily lows on the NAZ ballooned ahead of the SPX all-time high.

The expansion of new lows ahead of the 2000 and 2007 SPX peaks was the sign of the deep bear markets that followed.

As we wrote last week, The Crash Is Here. The Ketchup to the downside by those names that have held up is on.

All names are a source of funds.”

December 28, 2021: The Biggest 4 Day Rally of 2021 Is An Orchestrated Buying Panic

“December and its last weeks' flourish is the kind of behavior that, like 1929, convinces the vast majority that every pullback is a buying opportunity. My expectation is that we may see a spike high into the 7 squared or 49th calendar day Gann Panic Cycle into December 31/January 2. We are also 7 squared years from the false breakout in January 1973.

Many major tops end with buying panics…such as March 24,2000.

The SPX is up over 6% in 4 trading days.

This is a slope and trajectory greater than the blowoff top of approximately 16% in 16 days in 1929.”

January 3, 2022: Gold Update

“The metals complex is painting a bullish picture of a potential large rally phase.”

January 4, 2022: The Message of the Market

“Tomorrow’s report will further flesh out how several cycles (including war cycles) are due to exert their downside pressure making 2022 one of the most eventful years in market history — suffice to say that 2021 was the 5th lowest volatility on record: 2022 will see intense volatility.”

January 10, 2022: QQQ Crash Pattern

“Checking a weekly QQQ shows the bottom rail of a trend channel from the March 2020 crash low around 320.”

On February 24, QQQ traded down to 318.26 and bounced hard. On Friday, March 11, the Q’s closed at 324.40.

January 13, 2022: You Ain’t Seen Nothin’ Yet

“The “double top” in AAPL and 3rd lower high in MSFT speaks to the idea that even sacred cows are a source of funds now.”

January 19-21: Decisive Time For Many Stocks

IWM projects to the 186 region in the first half, perhaps even the first quarter.” IWM struck 187.92 on February 24.

January 24, 2022: The Crash of 2022

“Throughout the last quarter of 2021, the Hit & Run Report outlined how stock indexes were expected to see a series of peaks, first in late November, then no later than early January 2022.

2022 is a crash year.

We have already seen a vast number of glamours crash.”

January 31, 2022: January Saw A Crash, But It Is Likely Not THE Crash

“The current powerful downdraft is natural selling resulting from a major cluster of cycles exerting their influence, which could pull stocks down in a crash.”

February 24, 2022: The Crash

Feb 28, 2022: SWIFT Move

“Those following my analysis have been prepared for the market to get hit beginning in January as well as the intense rise in volatility.

For the last month, we’ve been pointing to a turning point INTO February 22 (the SPX struck a low on February 24).

Breakage below last Thursday’s (2/24) Bottoming Tail opens a Trap Door to 4020 or lower?

March 7, 2022: How To Glimpse the Future

“Speculation is observation, pure and experiential. Thinking isn’t necessary and often just gets in the way.

Speculation is anticipation of the anticipators.

The remarkable Square of 9 Wheel breathes life into both maxims, giving glimpses of the future.

2022 is going to be unlike 2021 in that clusters of cycles forcast intense swings such as we’ve seen in the first few months to continue throughout the entire year.

This is a tremendous opportunity for the Hit & Run trader versus the Buy & Hold trader.

For example, we put on a VXX call trade last week. That position EXPLODED for a big profit today as VXX spiked.

It is a dangerous time for those without timing tools and the pinpoint price projections given by the Square of 9.

Current Stock Market Position

This week has been on our radar as a Panic Cycle since last year.

One reason is that Black Monday, Oct 19, 1987 was 35 years and 5 months ago.

On the Square of 9 chart below you can see that 34.5 (green) squares out with this week (blue).

The market has been heavy. Crashes come from lows, not highs.

There are a few technical reasons, aside from geopolitical, that a Trap Door could open here.

1) Many former high flyers are in their own bear market with declines of greater than 50% from their 2021 peaks.

If the stocks that have hung on, such as MSFT and AAPL, become a source of funds, the SPX itself could play downside catch-up.

2) Below is an SPX from the 2000 bull market high. Notice the parallel channel that connects the 2000 peak and the early January peak.

A 50% retrace from the March 2009 bear market low is 2742.

Notice how this ties to the bottom rail of this big picture trend channel. Whether this region will be satisfied in the bear market is to be determined but breakage below our key 4000 level opens the door lower.

Clearly, the move off the March 2020 low was parabolic. Typically parabolic moves revisit their point of origin, carving out Eiffel Tower patterns.

Consequently, a drop to the 2750 region cannot be dismissed out of hand.

Also notice that this 2750 region ties to the congestion throughout 2018.

While that could be the bear’s agenda, it could take time to satisfy.

In sum, this week sets up as a major turning point.

It could be a low or an acceleration point (down) or a reversal (following a plunge).

Checking a six year Advance/Decline Line shows it is at the bottom of a channel that has defined support.

This implies we may be staring a low in the face.

Alternatively, breakage of the channel indicates a downdraft.

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