Tuesday, July 26, 2016

SPX vs BB 233 var 2 + 125 DMA | Resistance and Support

Upper Bollinger Band (Length 233 Days; + 2 Standard Variations) | 125 Day Moving Average

Thursday, July 14, 2016

VIX | Put/Call Ratio | AI Forecast | Extreme Greed

The VIX should turn up today, meaning the SPX turning sideways-to-down into Jul 20 (Wed).
The next lows in the VIX (= highs in the SPX) are likely Jul 14 (Thu), Jul 28 (Thu), and Aug 16 (Tue).
Source: CBOE
Source: CBOE
FFC Long Range Forecasts rely exclusively on Artificial Intelligence and Machine Learning to analyze and model.
Source: Financial Forecast Center, LLC.
90% of the stocks in the S&P 500 are now above the 20 Day Moving Average.
Source: CNN Fear & Greed Index

Tom McClellan: NYSE vs Haurlan Index | Not A Price Top (Yet)

Haurlan Index - A reliable “Not A Price Top” Indicator. Source: Tom McClellan
Tom McClellan (Jul 13, 2016) -  If you want to have a recipe for a sustainable bull market, the best ingredient to start with is “gobs of breadth”. Strong A-D data is a sign of plentiful liquidity. The stock market can encounter other types of problems, but if liquidity is strong then investors can get past momentary worries about Brexit, earnings, valuations, etc. I like to say that there are really only 2 fundamentals that matter for the overall stock market:
1) How much money is there? and
2) How badly does that money want to be invested?

Source: Tom McClellan

For the first one, we look at things like what the Fed is doing with QE, and what the A-D Line says about liquidity actually hitting the stock market. For the second, we use sentiment indicators of various stripes. In the wake of the June 23 Brexit vote, there were 2 hard down days, and then a long string of up days for the overall market, and with very strong breadth numbers. That brought us a new all-time high for the NYSE’s A-D Line, and a high reading for the indicator in this week’s chart [...] The 10% Trend of daily A-D can only get up to a really high level like this when there is a big surge of positive breadth like what we have just seen lately. And as the vertical lines in the chart show, a really high peak in this indicator seldom coincides with the final price high for the move. That’s the key insight. When this indicator zooms up to very high levels, it can serve as a reliable “Not A Price Top” indicator.  So there is your headline: Not A Price Top (yet).

The Annual-, Presidential- and Decennial Patterns of the DJIA have major highs in mid August and early September (also HERE).
Nautilus Research (Jul 12, 2016)
LPL Research (Jul 12, 2016) - After a new high [in the S&P 500) was made, the returns going out a year
were better than the average return. In fact, going out six months and a full year shows very strong
returns, up 7.3% and 14.0%, respectively, on average. A year later, the S&P 500 has been higher 12 out
of 13 times, with only the May 2007 new high lower a year later.

Friday, July 8, 2016

US pushes the World towards Nuclear War

"How do you not understand that the world is being pulled in an irreversible
direction? You people do not feel the impending danger
[...] I don't know how
to get through to you people
", said Vladimir Putin at a meeting with foreign
journalists at the conclusion of the Saint Petersburg International Economic
Forum on June 17th, when he left no one in any doubt that the world is headed
down a course which could lead to nuclear war
If the current situation continues, the outcome could be a devastating nuclear conflict. Washington poured five billion dollars into Ukraine with the aim of eventually instigating a coup on Russia’s doorstep. Washington and NATO are supporting proxy forces on the ground to kill and drive out those who are demanding autonomy from the US puppet regime in Kiev. Hundreds of thousands have fled across the border into Russia. Yet it is Washington that accuses Moscow of invading Ukraine, of having had a hand in the downing of a commercial airliner and of ‘invading’ Ukraine based on no evidence at all – trial by media courtesy of Washington’s PR machine. As a result of this Russian ‘aggression’, Washington slapped sanctions on Moscow.

The ultimate aim is to de-link Europe’s economy from Russia and weaken Russia’s energy dependent economy by denying it export markets. The ultimate aim is to also ensure Europe remains integrated with/dependent on Washington, not least via the Transatlantic Trade and Investment Partnership (TTIP) and in the long term via US gas and Middle East oil (sold in dollars, thereby boosting the strength of the currency upon which US global hegemony rests). The mainstream corporate media in the West parrots the accusations against Moscow as fact, despite Washington having cooked up evidence or invented baseless pretexts. As with Iraq, Libya, Afghanistan and other ‘interventions’ that have left a trail of death and devastation in their wake, the Western corporate media’s role is to act as cheerleader for official policies and US-led wars of terror. The reality is that the US has around 800 military bases in over 100 countries and military personnel in almost 150 countries. US spending on its military dwarfs what the rest of the world spends together. It outspends China by a ratio of 6:1. What does the corporate media say about this? That the US is a ‘force for good’ and constitutes the ‘world’s policeman’ – not a calculating empire underpinned by militarism. By the 1980s, Washington’s wars, death squads and covert operations were responsible for six million deaths in the ‘developing’ world. An updated figure suggests that figure is closer to ten million. Breaking previous agreements made with Russia/the USSR, over the past two decades the US and NATO has moved into Eastern Europe and continues to encircle Russia and install missile systems aimed at it. It has also surrounded Iran with military bases. It is destabilizing Pakistan and ‘intervening’ in countries across Africa to weaken Chinese trade and investment links and influence. It intends to eventually militarily ‘pivot’ towards Asia to encircle China.

Speech by Sahra Wagenknecht in the German Bundestag debate on July 7th
over the Government Declaration on the NATO Summit in Warsaw: "The US
nuclear weapons in Germany are to be modernized - not degraded, Mrs Merkel:
modernized - and missile bases are to be set up in Europe. Supposedly it's
all about deterrence, i.e. to keep Putin from invading the Baltics. I would
be really interested to know whether those who tell us this nonsense, believe
it themselves, even for a second
Washington’s game plan for Russia is to destroy it as a functioning state or to permanently weaken it so it submits to US hegemony. While the mainstream media in the West set out to revive the Cold War mentality and demonize Russia, Washington believes it can actually win a nuclear conflict with Russia. It no longer regards nuclear weapons as a last resort but part of a conventional theater of war and is willing to use them for pre-emptive strikes. Washington is accusing Russia of violating Ukraine’s territorial sovereignty, while the US has its military, mercenary and intelligence personnel inside Ukraine. It is moreover putting troops in Poland, engaging in ‘war games’ close to Russia and has pushed through a ‘Russian anti-aggression’ act that portrays Russia as an aggressor in order to give Ukraine de facto membership of NATO and thus full military support, advice and assistance. Washington presses ahead regardless as Russia begins to undermine dollar hegemony by trading oil and gas and goods in rubles and other currencies. And history shows that whenever a country threatens the dollar, the US does not idly stand by. Unfortunately, most members of the Western public believe the lies being fed to them. This results from the corporate media amounting to little more than an extension of Washington’s propaganda arm. The PNAC, under the pretext of some bogus ‘war on terror’, is partly built on gullible, easily led public opinion, which is fanned by emotive outbursts from politicians and the media. We have a Pavlov’s dog public and media, which respond on cue to the moralistic bleating of politicians who rely on the public’s ignorance to facilitate war and conflict. 

If Putin is reacting in a certain way, it is worth wondering what the US response would be if Russia had put its missiles in Canada near the US border, had destabilized Mexico and was talking of putting missiles there too. To top it off, imagine if Russia were applying sanctions on the US for all of this ‘aggression’.

In André Barbault's Cyclic Index better times are at the highs, bad times at the lows. In Claude Ganeau's Index of Cyclic Equilibrium
general mundane circumstances are considered to be better above the zero-line. Periods below the zero-line are generally less favorable
and oftentimes coincide with major military conflicts
(see also HERE)

Wednesday, July 6, 2016

The British Pound's 100-Year Debasement & The City's China Wild Card

Bloomberg (Jul 5, 2016) - Sterling first slumped after coming off the gold standard in 1931 in which it had been overvalued, just as it was in 1944 when it joined the Bretton Woods system of managed exchange rates. Another 30 percent devaluation was swallowed in 1949 and then Wilson sanctioned another drop in 1967 amid Britain’s balance of payments crunch. While the IMF was called in to help avoid a sterling crisis in the 1970s, it fell again in the early 1980s. 

UK Equity Markets Dip Below 5%.
Source: Bespoke (Jul 5, 2016)
The U.K. joined the Exchange Rate Mechanism, a precursor to the Euro, in 1990 but was forced out just two years later because it couldn’t sustain a link to the Deutsche Mark. Now there is speculation that life outside the EU will cost the pound its place in the top tier of reserve currencies. It currently accounts for 5 percent of foreign exchange reserves, according to the IMF. A weaker currency may not do that much to prop up the U.K. economy. While it should boost manufacturing and tourism, three-quarters of the economy is dependent on services such as finance and their future is subject to whatever access to the EU the British government can negotiate. There are also
British Pound Sterling (GBP) to Chinese Yuan Renminbi (CNY)
Source: www.xe.com
structural weaknesses leaning against the pound. The U.K. ran a near-record current account deficit of 6.9 percent of output in the first quarter and is suffering from weak productivity. Demand remains weak abroad and prices may not be that sensitive to swings in the exchange rate because producers still rely on foreign components for their goods.

Thierry Meyssan (Jul 04, 2016) - The Western Press keeps repeating the same message – by leaving the European Union, the British have isolated themselves from the rest of the world, and will have to deal with terrible economic consequences. And yet, the fall in the Pound could be an advantage within the Commonwealth, which is a far greater family than the Union, and present on all six continents. Famous for its pragmatism, the City could quickly become the international centre for the yuan and implant the Chinese currency in the very heart of the Union [...] The London Stock Exchange announced an agreement with the China Foreign Exchange Trade System (CFETS), and, in June, became the primary Stock Exchange in the world to rate Chinese treasury bonds. All the elements were in place to transform the City into a Chinese Trojan Horse in the European Union, to the detriment of US supremacy.

Ahmed Farghaly (Jul 6, 2016): GBPUSD: Contradicting the EUR

Sunday, July 3, 2016

Gold + Silver vs COT

The latest Commitments of Traders (COT) report suggests Gold and Silver could see a pullback.
Source: Fibbo (Jul 03, 2016)

SPX vs Mercury – Venus Cycle

SPX vs Jupiter – Saturn Cycle

SPX vs Mercury Speed

SPX vs SoLunar Map

SPX vs CBOE Equity Put / Call Ratio | VIX | Fear & Greed Index | NR7

Jul 01 (Fri) = NR 7
The 4 Lunar Month Cycle suggests sideways-to-up of the VIX into Jul 6 (Wed) = sideways-to-down in US-Stock Indices

Near a top.
: CNN Fear & Greed Index

Saturday, July 2, 2016

New Insights in Commodities | Cyclic Vibrations

Ahmed Farghaly (Jul 1, 2016) - The first chart is a synthetic chart of commodities. The way it was constructed was by isolating the second 18 year cycle of three 54 year cycle. The reason why I extracted the second 18 year cycle is because this is the cycle we are in right now in terms of commodities hence it should be correlated more with its counterpart in past 54 year cycles. I have also altered the length of the cycles to match the current average length of the 18 year cycle which is approximately 14.4 years. I then combined those cycles together in order to get a continuous series so I can isolate the cycle via spectral analysis and run neural network models on this particular position of the Kondratieff wave. The indicator that you see above is a neural network model with an 14.4 year cycle used as an input and the detrended zigzag as the output. This indicator's turning point should mimic those in the future provided that no significant changes occur to the length of the nominal 18 year wave. The second chart depicts the dates more clearly.

It is worth mentioning that the 14.4 year cycle with 4 harmonics was used as the input rather than just one harmonic, the reason for this was to aid us in depicted the peaks and troughs of the cycles smaller than the 14.4 year wave. As is visible on the chart above, we seem to have a clear path in the CRB index until late 2017. The projection also suggests that 2018 is likely to be a bad year for commodities. This correction should then be followed by a move into 4th quarter of 2020 followed by a correction to 2022 and so on (third chart).

In the neural network model below the price chart is an up percentage move indicator (fourth chart). It is calculated by having the cycle as an input and measuring the position of moves of over 7% a month and projecting something similar for the future of the current cycle. The likelihood of large percentage months on a closing basis is greatest from here going into mid 2019. Hence capital is best allocated in the commodity market now rather than chase the move after most of the large percentage gains have already been realized (fourth chart).

This indicator (fourth chart) is a forecast of the volatility index indicator using the same input as the charts above. It seems evident that the likelihood of high volatility is greatest from now going into 2020. This would mean that the purchase of call options are likely to be a better play than their sale in the upcoming environment. Trading in expectation of low volatility will probabalisticly lead to a loss going into 2020.

Wednesday, June 22, 2016

SPX: NR7 Inside Day | Bull Pennant Flag | Put / Call Ratio | VIX

June 21 (Tue) formed a narrow range inside bar - usually a trend continuation pattern (HERE).
Carboni sees a Bull Pennant Flag on the daily ES (HERE).

The daily range was the narrowest of the last 8 trading days (HERE), and volume contracted.
Today a breakout of yesterday's range is  likely.
However, Brexit-Thursday (Jun 23) is the next solunar turn-day, and the market may just wait for that.
Room to the top.
: CNN Fear & Greed Index

Tuesday, June 21, 2016

Summer Solstice Full Moon

It is very true, some of the Ancients have Winter and Summer, made the day and night to consist of equal hours.
I mean every hour to consist of sixty minutes, equally; but Astrologists do not so, but follow this method, viz.
according to the motion of the Sun both  Summer and Winter, so do they vary their hours in length or shortness.

One measures the time between sunrise and sunset and divides it into 12 equal parts.
These are the planetary hours (HERE)
June 18 (Sat) was a minor turn day in the geocentric and the heliocentric Bradley Indices,
June 20 (Mon) was a rare Summer Solstice Full Moon, the stock market seems in line with the SolunarMap,
and should move sideways-to-down into Brexit-Thursday, June 23.

Calculated and charted with Timing Solution.

Monday, June 20, 2016

BeLEAVE in Britain!

Enlarge | See also HERE
Nigel Farage (Jun 20, 2016) - The decision we face on Thursday is one which is fundamentally about who we are as a nation.

Remain would mean we stay part of a political union that makes the majority of our laws, which is engulfed in a calamitous eurozone crisis, and which has clear ambitions for further, deeper integration – including plans for a full EU army.

Leaving would mean that we would be taking back control. That those we elect as MPs would be the ones who make and decide our laws, rather than a bunch of unelected old men in Brussels who most people cannot name and who we cannot vote for or remove. Leaving the European Union would revitalise our democracy and mean that the big decisions were made by us instead of for us. I believe we're big enough and good enough to govern our own country.

The fact is that the European Union is a hopelessly outdated, stagnant, failed project. It is inwards looking in a global world, painfully ill-equipped to deal with the realities of the globalised world we now find ourselves in. Just look at how the EU has gone from one disaster to another, including a Eurozone crisis that has been the cause of huge amounts of human misery.

[...] This decision is a defining moment in the history of our country. I hope that we vote to Leave and to take our place on the world stage as a country focused on the wider, global picture, free and able to act in our own national interest. On Thursday, vote to leave the EU and let's make 23 June our Independence Day. 

Markets have fixated for the past week on whether Britain is about to vote to leave the European Union. Sterling,
the euro, gold, global shares and even the yen have had synchronized swings as the prospects of such a “Brexit”
rise and fall ahead of Thursday’s referendum. Markets Ignore the ‘Brexit’ Worst-Case Scenario: A Sterling Crisis.
Source: WSJ

Crude Oil Production Costs | IMF

Source: IMF

Sunday, June 19, 2016

The End of Cheap China | 16 Emerging Low Wage Economies

Source: Stratfor (Dec 28, 2015): Annual Forecast 2016.
Republished with permission of Stratfor.
China has completed its cycle as a high-growth, low-wage country and has entered a new phase that is the new normal. China will continue to be a major economic force but will not be the dynamic engine of global growth it once was. International capitalism requires a low-wage, high-growth region for high rewards on risk capital. In the 1880s it was the United States, for example. China was the most recent region, replacing Japan. No one country can replace China, but we have noted 16 countries with a total population of about 1.15 billion people where entry-level manufacturing has gone after leaving China. Identifying the Post-China 16 countries is not a forecast. It is a list of countries in which we see significant movement of stage industries, particularly garment and footwear manufacturing and mobile phone assembly. The Post-China 16 countries are strictly successors to China as low wage, underdeveloped countries with opportunities to grow their manufacturing sectors dramatically.

The new activity is focused on Africa, Asia and to a lesser extent, Latin America. When you look at the map, much of this new activity is focused in the Indian Ocean Basin. The most interesting pattern is in the eastern edge of Sub-Saharan Africa: Tanzania, Kenya, Uganda and Ethiopia. It is primarily garment and footwear manufacturers that are firstly starting to relocate. The second area where there has been a change-over is the market of cell-phone assembly operations. In the first field it’s the skills that are easily exploitable in the workforce. In the second sector of activity is the need to have low-prices to be competitive. 50 Turkish garment factories are currently relocating to Ethiopia for example. Hennes & Mauritz AB (H&M) are also currently considering purchasing more than 1 million garments from Ethiopia every month. Costs per unit in Ethiopia are 50% cheaper than in China at the moment. However, this is estimated to rise to the current Chinese level by 2019. Chinese salaries increased last year by 17.1% and the previous year it was 18%. Salaries in China are on average just 30% lower than in the US today. Salaries in China now exceed those in Mexico and in Turkey. Ethiopia has an economic growth of 10% today. However, it remains one of the poorest countries in the world despite having one of the top economic-growth prospects of the continent. Sri Lanka, Indonesia, Myanmar and Bangladesh are directly on the Indian Ocean. The Indochinese countries and the Philippines are not on the Indian Ocean, and even though I don't want to overstate the centrality of the Indian Ocean, they are nearby. At the very least we can say that there are two ocean basins, the Indian Ocean and the South China Sea.
Peru, the Dominican Republic, Nicaragua and Mexico are the Post-China countries in Latin America.

China's strength in infrastructure spending. Its bar is the highest.
The colored slices represent different kinds of infrastructure, while the width of the bars signifies the size of the economy.
The U.S. bar is wide and short because it represents a big economy with low spending. Source: Bloomberg.

Artificial Intelligence Long Range Forecasts | Stock Indices | Crude Oil | Gold

FFC Long Range Forecasts rely exclusively on Artificial Intelligence and Machine Learning to analyze and model.
Source: Financial Forecast Center, LLC.
Red dots represent monthly mean prices. First dot after the dashed vertical is June 2016, last one November 2016.

MarketVector Financial Forecasts produces long range forecasts using Multichannel Singular Spectrum Analysis (MSSA).
MSSA to decompose the time series into a trend component and many cyclical components. The decomposed
components of the time series are then projected forward in time.
Chartsedge  provides stock market forecasts are based on cycle
data which has been analyzed by a Pattern Recognition Program.
McVerry Report generates 5-Day U.S. Market
Forecasts based on Artificial Intelligence.