Stock chart patterns and technical analysis (TA) explained simply. Disclaimer: This blog and all its contents are for educational and entertainment purposes only. Do not trade or invest based on any information seen on this blog. Please read Terms of Service. The K E Stone blog sites (Keybot the Quant) are blacklisted by Google, so enjoy the ad-free experience, and only use the Donate button when supporting the sites.
Bitcoin rallied happily this year into the June top. Folks began tripping over each other chasing bitcoin higher to 10K, 11K, 12K, quick, the train is leaving the station. Unfortunately, it derailed peaking out at 12600. The descending triangle over the last three months was an ominous pattern. Using a couple different baseline levels, the blue triangle has a vertical side from 9950 to 12600, which is 2650 points distance. The purple descending triangle side is from 9550 to 12600, which is 3050 points difference. Thus, if the 9950 fails, the target is 7300 and if the purple triangle baseline fails at 9550, the downside target is 6500. Price is at 8289 currently. The 6500-7300 landing zone is in play since both descending triangle baselines failed. The MACD line is weak and bleak wanting lower lows in price in this daily basis but the RSI and stochastics are oversold and agreeable to a bounce for a day or two first. The 200-day MA is at 6820 coming up to join the party at the 6500-7300 zone. The bitcoin weekly chart is punched in the face down -22% thus far this week; that's a crash so more weakness is likely on the weekly basis. The 50-week MA support is at 6620 and rising another character moving up into that support zone area. Bitcoin may be a buy, say in mid to late October, probably from 6200-6800. In a couple days, the daily chart will likely set up for a bounce that lasts a few days; nimble speculative traders should be aware of that. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
The VIX battle at the critical 200-day MA at 16.55 continues. Do you think it is important? The blue line shows you how the robots and algo's respect it. There are about 21 touches today in this 3-minute time frame. The bears are currently winning with the VIX at 16.71 (the right margin got truncated) so stocks are off the highs. Bulls win if the VIX slips back below 16.55. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Tuesday Morning, 10/1/19, at 5:00 AM: The market makers jammed volatility lower at 3:59 PM EST as the regular Monday trading session ended. The Fed is always willing to maintain their jack boots on the throat of volatility to keep stocks elevated and appease their elite class masters. VIX was above the 200 in the chart above going into the closing bell and in the final minute sent down to 16.24 making for happy bulls.Keybot the Quant is tracking 15.93 as the key bull-bear line in the sand.If the VIX drops below 15.93, the bulls will celebrate as stocks strongly rally. If the VIX bounces between 15.93 and 16.55, stocks will chop sideways with a slight downward bias. If the VIX moves above 16.55, the stock market will fall apart. Note Added Tuesday Evening, 10/1/19, at 7:12 PM EST: The VIX spikes to 18.56 today so stocks tank.
The volatility battle rages on with bulls and bears pushing each other back and forth along the 200-day MA at 16.57 a key bull-bear deciding line. The VIX is currently trading Monday morning in the States, at 6 AM EST, at 16.96 with the S&P futures up +11. Thus, the stock market bears remain in charge but only by 39 pennies. The Keybot the Quant algorithm remains short and is tracking VIX 15.90 as the key bull-bear line in the sand (blue line). Thus, if the VIX remains above 16.57, the stock market selling will continue and likely accelerate.If the VIX drops below 16.57 and bounces between 15.90 and 16.57, stocks will chop sideways with a very slight downward bias.If the VIX falls below 15.90, it is off to the races for the stock market bulls with the SPX running towards 3K and higher again. The new moon peaked on the weekend and stocks are usually soggy through this period each month. This is the darkest time of the month so over the next few days, Saudi Arabia may carry out a retaliatory attack against Iran for the bombing of their oil facilities. Today is Rosh Hashanah so trading volumes will be lower this week. The Wall Street adage, "Sell Roshashanah and Buy Yom Kippur" is on the table. Yom Kippur is on 10/9/19. The lower volumes as the week progresses can exacerbate moves in stocks in either direction. The month and quarter-end is today, EOM and EOQ3, respectively. Window dressing took place last week which created a few days of buoyancy in equities. October begins tomorrow and new money typically creates buoyancy in the stock market the first few days of a month and especially the start of a new quarter (Q4). All this seasonality stuff is a mixed bag and more important when the markets do not have much going on. Obviously, this is not the case these days with President Trump facing an impeachment, the ongoing US-China trade war, the global race to the bottom by central bankers, oil price drama due to Middle East unrest, the rise of protectionism, Hong Kong turmoil and the flailing global economy, to name a few of the hot spots. Traders and investors remain relatively calm and relaxed through all the turmoil; fear would be shown by a rising VIX. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Tuesday Morning, 10/1/19, at 5:15 AM EST: Traders were concerned going into the new week of trading about the news that the US may limit Americans in buying Chinese securities. This news on Friday, as well as threats of delisting Chinese companies, sent stocks lower. Treasury Secretary Mnuchin now says there is nothing to see here and nothing is planned, move along, move along. He could have said that Friday. King Donny wants the stock market to remain elevated for the next year into the November 2020 presidential election. Also, Saudi Arabia flinches with Crown Prince Salman appearing on television downplaying a retaliation against Iran for the oil facility attack. Oil prices retreat to where they were before the attack. King Trump and Prince Salman are great at bloviating threats and espousing military bravado but then backtracking days later. These leaders should be quiet but carry a big stick rather than bloviating blowhards that carry a tiny stick. If they do not plan to use military action, they should not threaten it to begin with; it only weakens their stature. Foreign nations realize that Trump does not want a war so they will keep testing him going forward. The concern with this scenario is that it may force Trump to take military action somewhere around the globe to prove that he is a big man. Stocks recover and the VIX is jammed lower down to 16.24 at the closing bell. The central bankers step on volatility to keep stocks elevated to reward the wealthy class that own large equity portfolios.
The month ends (EOM) on Monday, 9/30/19, also quarter-end (EOQ3) so the September print will be cast in concrete on Monday and the October candlestick will begin on Tuesday morning. Monthly charts receive the new data point. Window dressing typically occurs at quarter-end. Underperforming money managers rush to buy the best stocks during the quarter just in time to slide them into the quarterly statements for their customers. These naive fund-holders are happy since they see that they own the stocks that are hot. Wall Street specializes in smoke screens. The window dressing created buoyancy in equities last week. New money typically enters the market at the start of a quarter so this activity may create buoyancy in stock prices the middle and late week ahead. The new moon peaks at 2:26 PM EST today, Saturday, 9/28/19, a couple hours away, and stocks are typically bearish through the new moon. This may have created some of Friday's sogginess in the stock market and perhaps into Monday's trade. President Trump may delist or otherwise prevent or limit Americans from owning Chinese securities. The stock market fell apart on Friday on this news and it sets the stage for an interesting open to the futures markets at 6 PM EST Sunday evening, and start of Aussie and Asian trading. As usual, King Donny bloviates bravado and will walk back the dramatic words to something more palatable for markets but this may take a few days. To add to the seasonality band wagon riding through town,Monday is the Jewish holiday where materialism is not welcome hence, "Sell Rosh Hashanah, Buy Yom Kippur."Yom Kippur is on Wednesday, 10/9/19. Lots of Jewish folks will likely not trade for a few days after Monday so this will enter the market mix as well. Thus, on a seasonality basis, we had the window dressing. Monday may see new moon weakness along with the Trump-China tweet weakness. Tuesday through Friday stocks may experience buoyancy as new Q4 money enters markets. For the next 8 trading days, trading volume may be lighter and the buoyancy with new Q4 money may be offset by the negativity of Rosh Hashanah. Also, the 70-year celebration of the People's Republic of China, of communism, is October 1st. The Hong Kong unrest should ramp up to soil President Xi's party. All that background stuff aside, the monthly chart is a sick pup. This is said even with September about to log an up month. September began at 2926. The S&P 500 is at 2962 so it would have to tank 36 points in the Monday trade to create a negative September. That could happen if retail stocks, chips and/or bank fall. The SPX monthly chart is extremely scary and significant since it is calling for an epic multi-month and multi-year top in the stock market. All the parameters are negative on this monthly basis. Of course, the Federal Reserve's dovish monetary policy, and/or President Trump's tweets, can change the chart posture immediately.As of now, on th long-term monthly basis, it's over for the stock market. One thing that pops out is the distribution occurring (brown circles) the so-called smart money handing off shares to the bag-holding dumb money. During an up month, the pump and dumper's will tout how great companies are doing. Frank Retail, and Joe Sucka, take their savings and run into the market during the next month to buy the hyped-up stocks especially tech stocks that folks believe will never go down. Pump and dump. The higher volume in the following month shows the smart money succeeding in sluffing off the shares to novice investors. Maybe there are not as many suckers around this time since the September trading volume is very low perhaps the lowest since right before that May 2015 top. Technology is allowing common investors to become wise to Wall Street's corrupt and rigged games. The RSI, stochastics and money flow were all overbot and the stoch's remain overbot all are agreeable to a pullback. The red rising wedge pattern is ominous since it represents the edge of a cliff. Price can fall (crash) into oblivion when the lower trend line of the wedge gives way. Price is up inside the apex of that wedge and there is not much room remaining. The red lines show universal negative divergence across all indicators and it is drastic and ugly. Look how strong and erect the RSI was in late 2017 but now it is a limp noodle. Usually, you may see some short-term strength over the last few months that may create a month or two more of oomph but there is none of it there. This current time in the markets is when everyone is enjoying the party on the boat, drunk as skunks, singing songs and bragging to one another how large their stock portfolios are, but one partier outstretches his arm, with a cigarette in his fingers, pointing at a tidal wave four times higher than the ship that is about to hit. There is only enough time to scream. The SPX has pegged the upper standard deviation band so the middle band at 2793 is on the table also the lower band at 2541.If the downside started gaining steam, the 2793 would be inevitable. Price remains above the moving averages requiring a mean reversion lower. The ADX shows that the upside in 2014 was a strong trend and likewise, the trend in 2018 was a strong upside trend. However, this has petered out and is no longer a strong trend higher in stocks starting in April-May of this year. Interestingly, the ADX lost its strong trend in early 2015 right before that stock market top. Keystone cannot overstate the huge important and epic time upon us. It is here. Sure, King Donny or Jester Powell may boost stocks again but at least at this point in time, the top is in. A tweet or dovish tweak to monetary policy may extend the party for a month or two but the long-term stock market top is at hand. If you are a young person, get out of the stock market; you can easily lose one-half, two-thirds or maybe a lot more of your money over the next year or two. Let the wealthy take the losses. Don't hold their bag of excrement. If you are any investor, all stocks that you do not plan to hold for say 5 to 7 years or longer should be sold. What is even more interesting is that October is upon us the month where severe market crashes have occurred. Do not treat this period lightly. As a student of the market for many decades, this is very serious. These levels in the SPX may not be seen again for many many years. Market confidence is key especially full trust and faith in the Federal Reserve. The entire fate of US markets rest on Chairman Powell's thin shoulders. The action in the chart above hints that confidence in markets is waning which then hints that the market-saving measures the Fed and/or Trump may take may be viewed as too little too late. Be quiet. Do you hear that? The bell tolls. Does it toll for thee? Keystone can post this chart again in a few days once the October month is underway if folks are interested. That PTON Pelotin IPO flop was comical. Why would anyone buy a $5,000 clothes hanger from Pelotin when they can buy an $800 clothes hanger from Wal-Mart? They should call it Pantload instead of Pelotin. This gimmicky, fad-type stuff is reminiscent of the dotcom bubble top with Webvan and Pets.com. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added 10/1/19: Yesterday, noted billionaire, book seller, commentator and money manager Ken Fisher says the bull market will continue as it has for the last decade. Fisher says earnings are improving and Europe is getting a handle on their problems. He proclaims a positive path ahead and people should focus on all the good things happening everywhere. Fisher says gridlock in Washington, DC, is great since it will correlate to higher stocks. He says a negative year for the third year of a presidency has not occurred since the 1930's. Fisher paints a rosy path ahead for the stock market. There you go. Two completely opposite views. Which horse are you hitching your wagon to for the months ahead? Keystone or Fisher?
The long US dollar trade is the most unloved trade of the year. Everybody and his brother is expecting the dollar to drop so it does not. Good news in the markets and economy, and strong growth ahead, occur in concert with a lower dollar but that is replaced with sketchy data and a geopolitical swamp of despair. The world has changed a lot after a decade-plus of central banker intervention in markets. The Federal Reserve and other global central bankers have destroyed all price discovery and the business and economic cycles with their obscene Keynesian money-printing. The world is awash in liquidity (until the cracks shown in the repo market over the last week or so) and that money has been used to buy stocks, bonds, real estate, art, collectibles, antique cars, vineyards, etc..., creating bubbles across all asset classes. The party continues as long as global investors remain confident that central bankers can always save the day. When confidence is lost in the Fed and other central bankers, it's over. It was surprising at the end of last year when Chairman Powell raised rates only to do a 180-degree turnaround at the start of this year taking a dovish stance. The Fed is obviously floundering but the market participants continue to believe in their power to print money. President Trump is under siege with a new scandal as the corrupt crony capitalism system in America is on its last legs. It is interesting to watch crony capitalism crumble week after week. The two corrupt American political parties are being exposed in the Ukraine scandal. You do not want to hitch your wagon to either of the parties. The democrats and republicans are two sides of the same corrupt coin; demopublicans and republocrats. In this Ukraine dust-up, King Donny allegedly was bribing the Ukraine president by withholding US military aid unless the new president conducted an investigation into democrat presidential candidate Joe Biden and his son Hunter Biden. Donny wanted dirt on Biden so he could easily defeat him in the election next year. On the flip side, when Biden was vice president under Emperor Obama, he withheld aid until a Ukrainian politician, that was investigating Biden's son, was fired, which occurred. Dirty politicians and filthy corruption is standard fare these days. Humorously, Trump was making the case that he did something similar to Biden but claims his illegal acts were more pure. Crony capitalism destroyed the United States over the last five decades. The wealthy elite class raped the country for all its worth destroying the middle class so they could receive higher stock prices and more money. What greedy b*stards. America will likely be a socialist-lite government in 10 or 20 years. The recession is upon us now and once that hits it will morph into a class war in the US. There will be lots of turmoil for a decade or two similar to the 1960's race riots. History often rhymes. So there is lots of fun to look forward to in the years ahead; collapse of crony capitalism, recession, class war, and ultimately a more socialist-style government. President Trump plans to emphasize the destructive nature of socialism during his election campaign over the coming months. This is funny because if you ask they average American what socialism is they will look at you with blank stare; some will say it may have to do with social media. The huddled masses know they have been screwed since the Great Recession a decade ago while at the same time watching the rich become filthy wealthy courtesy of the central banks. Average folks want their share now and do not care if you call it socialism or any other term. In truth, all government systems fail after 200 to 250 years, or sooner, since humans are corrupt and their acts are non-transparent. It's not rocket science. The corrupt politicians, investment bankers and corporate executives sold America down the river over the last few decades. The non-transparency in government policy and financial transactions and connections make it easy for the wealthy to steal effortlessly off of society. For the new impeachment battle with the Ukraine scandals (both Trump's and Biden's dishonesty and perhaps illegal acts), if Teflon Don weathers the storm and overcomes the impeachment problem, the dollar would likely bounce strongly. Central bankers around the world continue to debase their currency, the race to the bottom is well underway a la the 1930's, and creates dollar buoyancy. Comically, democrat presidential candidate Elizabeth Warren is the winner in all this drama. Plus, she wears a skirt. Women elect the leaders since they out vote the men by 60/40 or 55/45 (attendance at the polls). The ladies were likely ready for a woman president last time but could not vote for Hillary Clinton due to her corruption. Thus, the orange-headed bloviating carnival clown defeated the two-bit liar in a pants suit. The women may be ready to vote a woman in as president come November 2020 only about 13 months away. All that geopolitical mumbo-jumbo and palace intrigue aside, the dollar pegged 99 this week at the upper trend line. The blue upward-sloping channel remains in play and price may want to relax back down to the lower rail in that 96-97 area. The red rising wedge pattern is ominous since the collapses from rising wedges can be quite dramatic. The red lines show negative divergence in play so the chart is very agreeable to a pullback in the weekly basis. However, as always, the daily news flow can send the dollar one way or the other depending on the Fed or Trump's comments and/or policy changes. There is a potential M Top forming over the last couple months; it depends on if the right leg down occurs. Price has violated the upper standard deviation band so the middle band at 97.42 is in play. There are lots of dollar shorts in play and they were happy in May and June but once the dollar started to recover, a massive short covering rally rocket-launched price from a 95-handle to the 99-handle now. The ADX shows that the downtrend in the dollar during 2017 into 2018 was a very strong trend but it petered out in April 2018. The dollar recovered from there to present but the ADX shows that the uptrend is not considered a strong trend. The ADX views it as sideways choppy action with an upward bias. Looking at the chart, despite the feeling that the dollar has been doing nothing but rising for many months, it has actually chopped around between 94 and 99 for 1-1/2 years. During the May and June selloff this year, the Aroon did not perform a negative cross so the dollar recovered. Dollar bears need that negative cross before they can celebrate. Keystone does not have a position in the dollar currently. The baby games with the Democrat and Republican Tribes continue as the huddled masses are ignored. The little democrats will tune in to CNN and MSNBC cable news today and cheer their tribe while the little repubs will tune in to Fox News to receive their talking points they can tout at the office water cooler. Isn't is all pathetic? This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Volatility pops so stocks drop. The VIX jumps above the critical 200-day MA which is a key short-term bull-bear market signal. The 200-day MA sits at the infamous 16.66 level. The SPX sports its own '666' sitting at 2966.60. It does not get more simple than this. Bulls win big if the VIX drops below 16.66. Bears win big if the VIX remains above 16.66. You will likely see a back kiss, and bounce or die decision, at 16.66 today. Keybot the Quant algorithm remains short. The quant currently identifies VIX 15.90 as a key bull-bear line in the sand. This is why the stock market tanked yesterday once the VIX shot above 15.90. Thus, bears will keep sending equities lower and lower as long as the VIX remains above 16.66. The stock market will chop sideways with a slight downward bias if the VIX bounces between 15.90 and 16.66.Bulls will rejoice and sing happy songs if the VIX drops below 15.90 since stocks will be rallying strongly. The VIX is currently trading at 17.43 with S&P futures down -4 about 2-1/2 hours before the opening bell for the regular hump day trading session. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Thursday Morning, 9/26/19, at 10:26 AM EST: The stock market is open for about an hour with the SPX down 12 points, -0.4%, to 2972. VIX 16.79. The bears are winning. The 200-day MA is at 16.60. The bounce or die decision today from this VIX 16.60-ish level determines stock market direction ahead. Note Added Friday Morning, 9/27/19, at 5:27 AM EST: The stock market will open in four hours. The VIX drops to 15.70 so S&P futures pop +7. The battle continues. Bears could not hold the 200-day MA and now lost the critical VIX 15.88 bull-bear level called out by the Keybot the Quant algorithm. Bulls win below VIX 15.88 while bears win above VIX 15.88. Note Added Saturday Morning, 9/28/19: The VIX catapults higher to 17.22 and the SPX drops 16 points, -0.5%, to 2962. The stock market is a bucking bronco tossing around bulls and bears alike. Comically, if you do not like the stock market direction, simply wait a day since it will be going the other way.
The BPSPX has been on a market buy signal since it reversed from 46 to 52 in August (a six percentage-point reversal). Stocks rally. The BPSPX is at an important juncture now. If it moves above the critical 70% level, the bulls will cheer and throw confetti because big-time record highs are ahead for equities. The BPSPX would be on a double-whammy buy signal; very bullish. Conversely, the bears must push below 62.80-ish, a 6-point reversal, to firmly verify that stocks will continue selling off ahead.Bulls are okay as long as they keep the BPSPX above 62.80. If price stalls before 70 and fades lower, that will hint that the bulls are running out of gas. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Wednesday Morning, 9/25/19: The BPSPX finishes the Tuesday session at 67.00. The SPX drops 25 points, -0.8%, to 2966.60. Bears cannot celebrate until another 4 points are lost with the BPSPX.Bulls must jam the BPSPX 3 points higher to send the SPX above 3K and to new record highs. The S&P 500 will chop sideways with an upward bias until one of these two flinch. Note Added Thursday Morning, 9/26/19, at 10:33 AM EST: The BPSPX is at 66.00. The saga continues. Bulls and bears battle.
Microsoft monthly chart was posted a few days back showing that a multi-month and multi-year top is in the offing with MSFT peaking out anytime between now and the end of the year. Keystone figured there was another pop on tap and Mr Softy, standing in a top coat and tails, pulls a rabbit out of the hat. The bunny is named "Buyback." MSFT rocket launches higher (brown circle) as the wealthy pat each other on the back and tell one another how smart they all are, of course with the help of the Fed's easy money. Buybacks are the mother's milk of stock prices. Comically, it used to be earnings. There are companies that have repurchased 30% or 40% or more of their stock in recent years which means their earnings are that much higher (kept higher) and their PE's remain lower. As the recession approaches and financial markets fall apart over the coming year or two, analysts will look back and cite the obscene buybacks as one of the major causes of the bubble. Microsoft has nothing better to do with its money, not buying any start-up companies nor investing the money in equipment or employees, than to buy back stock so the elite class can see their stock portfolios grow larger. Before the Great Recession a decade ago, when a company did a buyback it would immediately bounce the price, as it does now, but in three months time the stock price would typically be lower. This behavior was erased by the last decade-plus of global central banker money-printing. The buybacks keep coming over and over again and stock prices climb to the sky. Interestingly, Mr Softy may want his money back because his bang for the buck lasted all of about 3 or 4 hours, two candlesticks, and price retreated back down. Go back and review the prior chart but the thinking is a retreat now, but MSFT will come back up again for another matching or higher high, then that will be THE top likely in that late October to December time frame. In the very short-term (VST) time frame, it is likely best to wait and see if price comes back up on the chart above. The upper channel trend line spanks price down after the gap-up move on the buyback news, but note the long and strong MACD line that wants another matching or higher high. Price may float back up to check out that gap-high level again and that should place neggie d across all indicators and set up a short. Long live buybacks! Long live the modern-day money God's that financially engineer wealth for the elite class; the central bankers! Sing Praise! This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Walmart climbs up onto its high horse proclaiming itself Holier than Thou announcing that all sales of electronic nicotine delivery products will be halted. Walmart opines about the deaths due to vaping and the concern the retailer has for children's welfare and health. Comically, they release this statement; "We will complete our exit after selling through current inventory." Pause for laughter. Self-righteous Walmart is so concerned about children using vape products, in light of the recent deaths in the US and Canada, that they will no longer sell these instruments of doom, but only after they sell the existing inventory. Cheap b*stards. WMT wants to recover their cost of goods sold so they do not lose money. Crony capitalism is always on full display in corrupt America. Walmart could not care less about children; if they did they would simply pull the products immediately and take the business loss. However, morality has no place in today's greedy and sick society. The WMT monthly chart has gone parabolic. Price shoots from 80 to 120, a big +50% gain, over the last year. Walmart stockholders dance with glee at the big price gains and make sure that management will deliver all those vape pens into the huddled masses hands as soon as possible. WMT has definitely cut expenses helping create the rise in price. In the Pennsylvania stores, you have to look long and hard for a sales associate for help. When you find one they are worthless only telling you to look over yonder somewhere or maybe the item is discontinued. Most have attitudes that you should have not bothered them. Obviously, expenses are cut to the bones since the stores are understaffed and the people there feel they are underpaid. This stuff may make for unhappy employees but that does not matter; stock price is all that matters and a thinner staff equates to bigger earnings, at least in the short-run. WMT keeps moving from the lower left to the upper right. WMT longs sing songs and are carryin' on looking forward to more upside ahead. Well, at least they have a month or so more of it. Walmart is a stock topping out on a multi-month and multi-year basis just like the broad stock market. The rising red wedge is ominous; the collapses from rising wedge patterns can be epic. The red lines show negative divergence in play that wants to spank price lower in the monthly time frame. This is occurring as price tests the upper trend line of the wedge and upper standard deviation line. The middle band is in play at 96.11 and rising. The RSI, stochastics and money flow are all overbot agreeable to a pull back. Price is extended above the moving averages needing a mean reversion lower. Now here is the tricky part. The WMT weekly chart is in neggie d now with all its indicators so it will puke on the weekly basis. But note the long and strong MACD line in the monthly chart as well as some short-term mojo with the RSI and histo. The MACD wants a higher high in price after a pullback occurs on the monthly basis. The negative divergence red lines above in the monthly chart will conspire with the neggie d on the weekly chart to spank WMT lower now. This retreat will be a couple or few weeks but then WMT will recover again due to the long and strong MACD on the monthly. WMT will rally again to the current highs and that should be in concert with the MACD going neggie d and the long-term multi-month and year top is likely in for Walmart, say in the October-December time frame. So this is a peak now, price will drop say to finish this month and into early and mid-October, but then rally again back to the record highs say in late October or November, then roll over and die in November or December. Of course the timing can all be fine-tuned as time proceeds. The daily chart looks good to short now. Ditto the 2-hour chart. Keystone will short some and let the neggie d on the weekly chart and the partial neggie d on the above chart take her lower for couple-few weeks. Then the trade can be flipped long to ride it back up, then flipped short again a month or two out. Climb on your self-righteous white horse Walmart and ride through town distributing vape pens to all the little girls and boys hangin' 'round. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Tuesday Morning, 9/24/19: WMT gains +0.6% in the Monday trade to 117.62. Management is in the parking lot selling vape pens before they are stuck with the inventory. Humans will do anything for money.
Oil took the wild spike higher last week on the drone and cruise missile attack on the Saudi Arabia oil facilities and fields. After the smoke cleared, West Texas Intermediate Crude oil was up +6% on the week. Brent oil popped +5% last week. 5% of the world's oil supply was knocked off line by the attack, although there is lots of oil available in storage, but the Saudi's already restored over one-half the losses. Saudi Arabia says all production will be restored by the end of the month which is next Monday but this is already being walked back. Officials say it may take a few months to be fully back on line which is more realistic. The columns are special equipment that take a few weeks to fabricate. President Trump flinches again. He was all bluster a few days ago touting that the United States is "locked and loaded" puffing out his chest like a teenage boy at the high school dance. The president greatly toned-down that bravado message now saying he is pursuing diplomacy. Comically, he tries to convince everyone that his backing down and providing restraint proves that he is a strong leader. That's even a stretch for the showman King Donny. Trump balked at taking military action after a drone attacked a US ship. He backed away from taking action as oil tankers transport bootleg oil across the Mediterranean. Now he balks at taking military action against Iran for the Saudi oil facility attacks. The president is deploying more US troops and equipment to the region to support Saudi Arabia. Foreign leaders know that Trump is all bark and no bite. Humorously, he ridiculed Emperor Obama for drawing a red line with Syria that Assad immediately stepped over. King Trump is going down the same road. Trump wants reelected and the timing of a war will sink his desire for four more years. The president likely wants to maintain status quo through the November 2020 election and then he would be free to do whatever he wants from 2020 to 2024. Trump campaigned on getting America out of wars not into them so he is in a tricky spot right now. The Saudi's are saying unequivocally that Iran was involved in the attacks. That tells you that a counter strike is coming. Trump is playing it coy but no doubt behind the scenes he, the State and Defense Departments are all involved in the planning. Politically, Trump can live with a surgical strike against Iran. He imposed more tariffs but that only gets you so far. Trump calls them the "highest level sanctions." Of course he does. Next week he will announce the highest-highest level sanctions. Trump does not want an all-out war but he may approve a surgical counter strike simply to gain back face. Trump talks loudly and carries a tiny stick, in his tiny hands, rather than what you want to be which is a man that talks softly but carries a big stick. Trump will make a political calculation that a small strike against Iran will prove he is a big man that will answer any aggression in the region and at the same time should not lead to lasting conflict that would hurt his reelection campaign. Time will tell how much involvement the US will have on any counter strike. The new moon peaks on Saturday, the darkest time of the month, so no doubt an operation will likely occur between Wednesday the 25th and Wednesday the 2nd. The US has superior night vision technology and will want to strike in pitch black darkness. So we will not have to wait long to see what happens, and what happens with oil prices. China has been stockpiling oil like madmen. They are probably filling up milk jugs, old soda bottles, buckets, anything they can get their hands on. There are many moving parts (supply and demand) in the oil markets nowadays making forecasting extremely difficult. Inventories were a big build last week hinting that global oil demand is falling verifying an economic slowdown. The threat of a global recession on the come drags prices lower while the threat of Middle East war and more drone strikes on oil facilities send prices higher. A major worry now is drone strikes on any target. Perhaps drone wars are in all our futures. Maybe that is why some science fiction authors envision future generations living underground; drones may rule the Earth. An ugly world is ahead if drones, strapped with explosives, begin flying the once-friendly skies. The price breakout to the upside rockets to 63 then back tracks to catch its breath. The vertical side of the triangle is about 11 or 12 handles so the breakout at 56 targets 67-68. Note the breakdown from the triangle in early August. You often see this pattern with sideways triangles. About one-half to two-thirds of the way through the triangle price will breakout, or down in this case, but typically it is a fake-out move, and price returns inside the triangle and then goes out the opposite side for the real move. As seen above, price returns inside the triangle and then explodes out the top. The green lines show the positive divergence and oversold conditions that sent oil price higher in early August. The chart is stumbling sideways now and not giving up any hints on direction. The upper band was violated so the middle band at 56.54, and rising, is on the table and would be targeted on a pullback. Oil prices are likely in a waiting pattern until the retaliation occurs for the drone strikes. Each day forward this week the overnight sky becomes darker and the march to potential war in the Middle East creeps closer. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
The Hong Kong protests are in the 16th week. Interestingly, the 70-year celebration of communism and the founding of the People's Republic of China occurs on October 1st only nine days away. it is surprising that the Beijing commie leadership has not cracked-down on the Hong Kong demonstrations harder. The protests are only becoming more violent. President Xi does not want the celebration sullied by Hong Kong. Either Chinese-backed forces have to go in and clamp-down hard on the Hong Kong demonstrators, or, Xi will lose face during the festivities. It is hard to brag about communism when you have Hong Kong seeking freedom from dictator Xi. No doubt an interesting week is ahead for Hong Kong. Protesters are throwing bricks, stones and petrol (gasoline) bombs at riot police. The police counterattack with rubber bullets and tear gas. The police threaten to use real live ammunition. The conflict will take a tragic turn if a human is shot. The Beijing leaders are likely pulling their hair out in fighting the budding revolution since the protesters have gotten smart over the last few weeks. Demonstrators pop up and wreak havoc at a given location but then melt back into the crowd and disappear. The overall situation is deteriorating. This morning, protesters are stepping-on, spitting-on and then setting ablaze the Chinese flag. XI is likely blowing a gasket with smoke coming out of his ears watching that occur. Hong Kong does not want to be under China's control. The protesters have several demands including pulling the extradition bill (the Hong Kong government announced plans to do so but demonstrators consider it too little too late), calling for the resignation of Chief Executive Carrie Lam who is a puppet of the Beijing leadership, granting amnesty to the protesters arrested, conducting an independent investigation into police brutality (the Hong Kong police are carrying out their own internal investigation) and voting for political candidates that Hong Kong picks not mainland China (universal suffrage). If Xi does not act this week against the Hong Kong protesters, he will wait until after the commie celebrations and then he will crush the movement in force just like the Umbrella Revolution was crushed. The Hong Kong demonstrators made it clear where they stand after Lam said she would pull the extradition bill. The response was that the gesture was like 'putting a band-aid on rotting flesh'. The SSEC, China, chart shows the golden cross occurring in March forecasting happiness ahead although price is basically at where the cross occurred. If you are bullish China, you want the two-leg bull flag to play out (green lines). Price is in its sideways to sideways lower consolidation flag right now. A break out higher will target 3550 (first leg is 2450 to 3250, a difference of 8 hundo, so a breakout higher from 2750, creating the second leg, is a target of 3550). If you are a China bear, you want the descending triangle to play out (red). Going with the April vertical side of the triangle at 2850 to 3250, say 4 hundo difference, would target 2450 on the downside if the 2850 gives way. The communists are managing their way through the sideways purple channel at 2850-3050. Bulls win big above that 3020-3050 area and price is knocking at this door. Bears win big if they spank price lower, which would be a failure at resistance; then they will gun for 2850. The PBOC (China's central bank) has been goosing stocks all year long. Note the failure in August that was stick-saved by the communist government with more triple R cuts (to boost bank lending) and other targeted stimulus. The central bankers are the market. The HSI, Hong Kong, chart shows the death cross occurring in August forecasting doom and gloom ahead. Of course price bounces when the death cross occurs, which is expected, and price will remain weaker as long as the death cross is in play. The red downward-sloping channel remains in play. Price is testing the 20-day MA support at 26391 so the HSI is making an important bounce or die decision to begin the week. Hong Kong citizens are boycotting pro-Beijing stores at the malls. There is long-term damage being done to the relations between Hong Kong and China that will last at least for a couple generations. So the world awaits for President Xi's response to Hong Kong. If he acts this week against the demonstrators and people become bloody and hurt, Xi will look like an evil, murderous communist dirtbag, which is the same as it is now, or, if he does not act he will look weak. There are many other top communist politicians in Beijing ready to stick the knife in Xi's back if they get a chance. Xi paces the floors of the palace all night long knowing that this week may determine if he remains the dictator-for-life in China, or not. Fires are burning in Hong Kong streets. The clock is ticking; tick-tock. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Fluor stock is a piece of garbage. Oh what a fall from grace considering that it was on the Forbes List of top companies for many years. From 75 to 16 is a -80% crash over the 5-year period. From 57 to 16 is a -72% crash over the last year. The H&S pattern shows a head at 74-ish and neck line at 37-ish which is a target of zero if the 37 fails which it obviously did. When the projection numbers point to zero or very low digits you have to take it with a grain of salt since it means bankruptcy. FLR dropped to 16 and has recovered to 20 trying to stabilize. The green lines indicate positive divergence which is bouncing price this month, however, the MACD line is weak and bleak wanting to see another lower low in price ahead on the monthly basis. FLR is a turd floating in the toilet bowl. The main reason the chart is posted is because of its importance in the engineering and construction industry. These behemoth companies employ big-time engineers, project managers, computer-drafting technicians, many skilled positions requiring years of education. In other words, these folks do not come cheap. You can always tell a recession is in full swing and starting to bite hard when you hear of large layoffs from engineering and construction companies. Fluor announced last week plans to cut expenses. More details will be released this week. They likely cut all the low-hanging fruit already and there is only one other choice to reduce expenses; start axing workers. If you work at Fluor, keep your head low since the manager will be walking up and down the halls with a scythe ready to lop it off. Keep an eye on all the engineering and construction companies and associated industrial plays such as JEC, KBR, ACM, MDR, FSTR, MTRX, PWR, HAL, EME, MTZ, DY and CMI to name a few. Keep an eye on the industrial and energy sectors, XLI and XLE, respectively. If you start to see layoffs increase at the engineering companies, it's over for the economy and recession is here. MDR has crashed -86% from 11.0 to 1.5 over the last 2 months. Good night Irene, Irene goodnight. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
The Keystone Speculator's Housing Market Indicator signals that a housing recession started in July. This month's housing data is robust. For example, Housing Starts are 1.364 million units overtaking the June 2018 high of 1.350 million units and the November 2016 high of 1.323 million units. It does not change the housing recession call, however. The red line is slipping further below the green line. It would take huge numbers in Starts, Permits and other housing data for several consecutive months to curl the red line higher again. It is odd to see such robust housing numbers late in the season. Fall begins tomorrow and if the earth-moving has begun on the sites for all these units, they will not be constructed by the time the snow flies. There is likely some special considerations in the data. Keystone called the housing recovery in February 2012 and was met with jeers. The doom and gloom was rampant back then and Wall Street braced for another stumble in the housing sector. The maximum negative sentiment marked the bottom in 2012. After 7 years and 5 months, the indicator flips negative and forecasts sorrow ahead for the housing sector. Peak Auto is likely occurring, or has occurred, as well. The housing and auto industries are the two main drivers of the economy. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
Lots of folks were out and about yesterday in support of climate change. Who wouldn't want a day off work especially if the employer is willing to pay you for it? Those companies are suckers. Many likely went to a protest for 20 minutes and then slipped away to go do stuff at home. News reports show young folks playing miniature golf and a group behind a corner gettin' high. What a fun day for all. Most of the guys in the protests are looking for dates. The day is a big party. Someone ask what is the cause? Several young folks look at each other in consternation and one says, "Something about climate." This is real life; many young folks view the day as party time. Sure, lots of young folks believe strongly in the climate change stuff but that is mostly due to brainwashing. It is sad to see kids only 10, 12 and 14 years old touting the climate change stuff and they obviously do not understand it or why. They cannot explain it; many of their parents are simply sticking a sign in their hands. They are simply brainwashed from a young age to be afraid of their own shadow and fear the end of the world by pollution. The school system, colleges and cable news networks all contribute to the delinquency of America's youth as well as many older folks concerning climate change. If you are a young person, you have to realize the education system, media and even many of your Mom's and Dad's tout the climate change stuff so that is all you know and the only way you think. It is stupid to think that climate models can predict billions of years of the Earth's climate based on a couple hundred years of temperature data; it's laughable. The scientists that promote the climate change agenda do it to receive funding so their jobs can continue. Duh. Even Billie Eilish knows how to say, "Duh" in her Bad Guy song. Their papers never stand up to scrutiny because most will not allow access to their data. Of course they will not since their data is fantasy. If you are a young person, you are shocked to read such blasphemous prose. You wonder how poor ole Keystone could be so misguided. You scream, "Climate change is real, we must be afraid, can't you see we have to do something, the end of the world is nigh?" Sit down and relax. It is the liberal elite class that mainly inhabit the East and West Coasts that have brainwashed you with the climate change agenda. Their end goal is to create wider wealth distribution across the planet. It is no mystery that over 190 countries are all lining up at the trough to receive funding for green energy projects that will save the Earth. These folks are dictators, murderous leaders, corrupt politicians, dirtbags to sum it up succinctly; they could not care less about the planet. They simply want the dough. Idiots from the West will grant a tin-pot dictator say a $100 million for clean energy endeavors. 80% of that will go into the dictator's pocket; how else can he pay for his gold toilets? He will erect a token windmill and buy a couple of solar cells and call it a day. Then he will be back a year later, probably in Paris, asking the West for more money. Are you beginning to understand what you are actually supporting? Everyone wants a clean planet. There will be plenty of revolutionary discoveries over the coming couple decades that will take care of your concerns over climate change so do not worry. Realize that both political systems in America are corrupt and you are better off becoming an independent thinker and shunning the group-think garbage. You need to ask yourself another serious question. A recession is about to hit and it is likely you will lose your job in the coming months. Do you actually want to see US taxpayer money going to the tin-pot dictators under the guise of climate change projects when you will be complaining that unemployment benefits need to be extended and the food stamp and other aid programs need to be expanded? Be honest with yourself. If you are a millennial, you have never experienced a recession as yet. Your world will be rocked in the coming months and next 2 to 3 years. Even if you do not lose your job, your friends or family members will. So have fun with the free day off for climate change. Hopefully, some of you guys and gals met new people and got some dates. But do not be brainwashed by all that climate change stuff. Instead, think independently like the Founding Fathers of the United States. In light of climate change day, it is only appropriate to look at the wind ETF, FAN, and the solar ETF, TAN. FAN can be shorted going forward. That chart is nasty with overbot conditions, the rising wedge, neggie d; there is nothing good about it. The TAN chart broke out higher from the sideways symmetrical triangle this year. 58-ish is targeted for the upside. It likely receives upside juice because traders think governments will buckle under the pressure of climate change protests and throw money at the solar companies. TAN may favor that brown sideways channel going forward. Keystone is not in either ticker but if he had to pick one he would short FAN going forward. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Monday Evening, 9/23/19: The young girl, Greta Thunberg, a climate activist frantically screams about climate change. Where are her parents? That is shameful to let a young girl be used as a puppet and pawn for a political movement. She screams about "a mass extinction." Who put all that stuff in her head? That is shameful and concerning for people to exploit a young girl screaming about a topic she is too young to fully understand. The video clip is very hard and painful to watch. No one is protecting the young girl from a mental and emotional standpoint. In 10 or 15 years, she will ask her loved ones why no one shielded her from the media circus. The world has gone mad. It's the bread and circus days.
The SPX places an M Top pattern on the 2-hour and then falls away in retreat. Remember, traders were fearless and complacent so a top was expected and the negative divergence on the 2-hour chart indicated the top. The standard deviation bands are pulling in tight so a big move would be expected, and the S&P 500 is down about 30 handles off the high a couple days ago, so far. More downside would be expected but as always, President's Trump or Xi, or their henchmen, may tweet happy talk to create a rally at anytime. The chart indicators are weak and bleak wanting to see price place a lower low in this 2-hour time frame. Remember, a H&S was in play but the right shoulder came up to a matching high to form a M Top instead. You can still call it a H&S, like Quasimodo, with a hunchback, which would target 2892-ish if the 2960 neckline fails. The potential island reversal pattern remains in play where price may move lower to 2960 and then immediately gap down to 2940. Stocks fell on Friday after China cancelled a meeting with Montana crop and agriculture people. So the trade war news and central bank drama is what drives the stock market up and down. What a sick financial world it has become. Note how price came down to the same price range as a couple days earlier but the selling volume outweighs the buying volume (brown circles). This is a bearish indication. Monday and Tuesday will be critical. Traders will be waiting to see if King Donny touts happy trade talk news at 6 PM EST Sunday evening to boost the futures markets. If so, he may stick-save the stock market for another day or two. If there is no happy talk, equities should continue lower in the hourly and daily time frames. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision. Note Added Sunday Evening, 99/22/19, at 7:41 PM EST: Right before futures opened for trading, China says the cancelled agricultural meetings last Friday (that tanked the US stock market) was not related to the trade talks. S&P futures pop +15 to begin the new week of trading. Global markets are a joke. Phony central bank money-printing and government intervention and happy talk are the market. Copper is marginally lower. The story gets better. The Whitehouse then says that the meeting was cancelled at US request. The Trump administration could have immediately said this on Friday fut they did not; thus, they spent the weekend thinking up a new story.
A year ago, Tilray was the favorite flavor of global traders. Medicinal marijuana, and all out legalization, gains popularity in the States and Canada is in the total legalization camp. Society is realizing that pot is far less harmful than booze and by an order of magnitude. TLRY was a moon shot. Traders were tripping over each other buying and smoking, smoking and buying. Price sky-rocketed to 3 hundo but when that fool could not find anyone to sell to he realized that he was the bag-holdin' fool. TLRY then performs an epic collapse topping at 300 one year ago and now at 29 off its lows. It's an over -90% loss top to bottom one for the record books. It is left for dead. Even Aunt Edna kicked TLRY in the head with her orthopedic shoe. Wall Street analysts, strategists and television pundits unanimously bash Tilray saying the piece of trash will remain garbage. It has no chance of recovery. You know these people are typically wrong and when the sentiment is completely loaded to one side, start looking at the other side. The downward-sloping channel is steady and orderly the bulk of it obviously machine-driven. Distribution was taking place into June where you see the pop due to the possie d on the histo, stochastics and money flow. Price would be expected to roll over again due to the RSI and MACD remaining weak and bleak, and it does. The green lines show the positive divergence bounce 3 weeks ago again the pot bulls calling a bottom in Tilray. Price rolls over slightly over the last 2 weeks due to that sketchy bottom in the RSI where it placed a sliver of possie d. It is odd to see the RSI weak and bleak when the MACD line is not. In a nutshell, the chart looks bueno (great for longs). Price is bottoming here and ready to rock and roll higher. TLRY came down to fill that gap from a year ago when it was just a baby. The door is open to 25 again but if the RSI holds the bottom is in. It would be better if the RSI would have firmly fell into oversold territory but it is close enough for government work. Note that the overbot conditions last November were only a sliver above 70. The stochastics are clearly overbot. The lower standard deviation band was violated so the middle band at 39.50, and trending lower, is on the table. Also the upper band at 54-ish. The ADX pink box shows that the trend lower over the last year was a strong trend lower until June when the strong trend lower petered out. This is indicative of a stock that is basing and stumbling sideways looking for a bottom. Price is below the moving averages needing a mean reversion higher. All these parameters are bullish across the board. It is simply a question on where to enter. Scaling-in, say, with 3 or 4 buys over the next month would be a good approach. The Aroon red line was at one hundo, now 92, and nowhere to go but down while the green line is at zero with nowhere to go but up; both favor the bulls. Keystone will be buying TLRY going forward. Folks want to smoke pot, that is all there is to it. It improves your mood and appetite if you are ill. It does not leave you with a hangover the next day; you may actually feel more rested. It is not a gateway drug to harder stuff; that is a myth. So as the North America's land begins sprouting more and more marijuana plants, Tilray should recover and string together a nice multi-week rally ahead. Perhaps the daily and 2-hour charts provide more insight into when to enter a long. Remember, price may come down to 25-ish again although a trip all the way lower to its offer price is not expected, but you never know (because the broader market may tank and take everything lower for a few days). The other very tricky aspect of Tilray is the massive short interest in the stock. Holy Schamolie. Everybody and his bro is short TLRY, there are no more shares available to short. Even Aunt Edna placed her entire life savings on the short side like the nice young man at the financial office suggested. As TLRY recovers, it will likely have a couple moonshot days as shorts panic and run for the hills creating huge short-covering rallies. Of course, they are all short because they believe the stock is going to zero, so their opinion cannot be discounted. The chart, however, says otherwise. That is why it is a speculative play. The daily chart is set up with positive divergence as September began providing the moonshot higher. Price is trying to hold the 20-day MA at 29.59; keep an eye on this as a deciding line. The chart is stumbling sideways. It would be nice if TLRY was soggy early this week since it will allow for better entry points to place a long. Anytime going forward, between now and a couple weeks or so, TLRY will place its bottom and then likely recover into the 30's and 40's in October. Smoke 'em if you got 'em. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.
