2017 is likely to be an interesting year, and the tape has already shaken off the December cobwebs and is moving again. On the bigger picture the chart below is how I’m seeing SPX on the monthly chart here, and the key message is that the bull market from the 2009 low here is most likely topping out or has already topped, though that doesn’t mean that SPX will necessarily drop much in 2017. This has been an eight year bull market and if we see the retracement that I’m looking at on the chart below, then we may not see that bear market low until 2020/1. If we see that 50% retracement then that would be a beautiful fibonacci move, and should then set up a very nice long into the next bull market.
Back on November 2nd, I suggested to my Slope Plus subscribers to “Short the Continent” (that is, sell short the Euro). So far, so good………we’ve got another major break this morning. The trade has thrown off about an 8% profit in a short amount of time, and I think we’re simply going to continue chopping our way down to a 1-to-1 ratio with the Euro.
The final appears of the year by The Creature of the Grey Lagoon takes place today. I, for one, will be glad when it’s over, since I can hardly stomach dealing with the market machinations when the old biddy is yammering away at these press conferences.
One item to watch in particular is the Yen, whose inverse relationship with the dollar is shown below. It’s a terrific top, and I’d expect a hard slump beneath this pattern once the interest increase everyone expects is finally out of the bag.
Yesterday was a an unexpected trend day. Usually trend days arrive on Stan’s cycle trend days but not always and yesterday was one of those exceptions. The double bottom targets that I gave on Monday morning for ES, NQ & TF have now all been made, and obviously this move is developing faster than I was expecting. This increases the odds of making the next significant high in mid to late December rather than January.
The trend day yesterday clarified the pattern setup here nicely on NQ & TF. Less so on ES, but that too is likely setting up for some retracement here. The obvious target would be rising support, currently in the 2218 area. ES Dec 60min chart:
Good morning, Slopers, and welcome back to another day in December 1999 – – whoops, I mean December 2016 – – in which this headline greeted us:
It appears equity markets didn’t get the memo that this was a really big deal. The chart since yesterday resembles the EKG of a corpse.
As the EUR/USD Forex pair continues its rather steep decent during the past couple of months, it is approaching a critical major support level around 1.04, as shown on the Weekly chart below.
Not only will a drop to that level form a potential triple bottom pattern, it will also hit a triple confluence of long-term price, trendline and regression channel “mean” major support.
A drop and hold below 1.04 could see a catastrophic price plunge to levels (0.8827) not seen since October 2000. We may, however, see price overshoot and drop below 1.04 briefly, before a potential bounce occurs.