Apr 11, 2017

Update

At the moment I see this pattern... complex wave B. It is too early in the cycle to see a plunge.

16 comments:

  1. On that move lower on GDXJ to May/June, below the March low? Looking strong here on GDXJ but still has a whiff of a fake out especially if the conventional markets move up from here and threaten new highs. Yet some miners look strong with volume like AG.

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    1. I do not see much strength - below key MA, taking too long to retrace after the sell off in February, most of them with only a-b-c higher. Yes, they should move below the March low in May.

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  2. Hi Krasi,

    I came across your blog. Awesome stuff. Thank you so much for sharing this info.

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    1. Surprised to see you turn short term positive given the move we are seeing in the VIX (not saying I disagree). Strange day though VIX/Yen/bonds saying we should be selling off hard, which started that way but retraced most of the move at the end of the day (VIX/Yen and bonds did not retrace though). R2K of all the indexes was rallying hard with huge outperformance. In my estimation this is all about positioning: futures positioning very net short R2K, very net long SPX, net short VIX/Yen/bonds...so market looks to be forcing a big positioning squeeze/unwind given the extremes.

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    2. Actually this explains the discrepancy you commented on between indexes. When I see R2K futures trading at premium to index when fair value below index I see short squeeze. Similar to GDXJ which is now 20% of index it is trying to replicate...index funds and leveraged futures creating a great mess. E.g., GDXJ now forced to invest in securities not in it's index...it's 2 biggest holdings are now GDX and AGI.

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    3. The tail wags the dog is what I am saying:)

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    4. I just watch charts and I did not like this sell off:) The pattern looks good. I looked at different indexes and if it plays out we will see all indexes in sync again for a final move lower and the end of the correction.
      I do not have observations on the futures/options markets, I do not have the time.
      I read that passive investing(ETFs) are taking bigger and bigger share of the market, which could lead to problems.

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    5. Thanks. It's interesting. So you still hold the above picture? How long do you expect this c of B play out? until next week or only up to Thursday this week? Now it looks like this b of B is still running...

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    6. Next week should be up then we will see if there is finished pattern for B or not.

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  3. Hi Krasi, thanks for your hard work and sharing! I am wondering if you use Gann's Theory. It suggests that, on a weekly basis, there will be a change in the week of 15-Apr, likely a short term bottom, then another turn in the week of 6-May, likely a short term peak. Time cycle here only, not price.

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    1. I have searched a few times books/materials about Gann Theory, but I have not found.
      So I have no idea what it is about.

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  4. It seems GOLD would hit 1300 for the peak in the next few days?? And the last hours news is interesting that USD would move lower and finally bottom? Maybe the potential war/tension can stir the market to find bottom and begin c of B in the above picture.

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    1. Yes, I expect to see in the next days a top for Gold and bottom for USD/JPY.

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  5. Is it testing the MA or? look like some impulsive down? Thanks.

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