Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

The Masque of the Red Death

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The title of this post is a reference to a story by Edgar Allen Poe, which I would strongly recommend and, not wishing to give much away in the way of spoilers, is about a very exclusive party given by a Prince Prospero that ended extremely badly for all participants. It seems an appropriate title today,

As I suspected Trump did go ahead with the April 2nd ‘Liberation Day’ tariffs and seems determined to persist with these for several months at least. In practice this is the largest peacetime tax hike on US citizens in history and it seems unlikely that this experiment will go well. Before I look at the markets today I’d like to put these tariffs into some factual and historical context.

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April Fools

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‘Fools rush in where angels fear to tread’ – Alexander Pope

Here we are on the morning of ‘Liberation Day’ and it really does look as though the Trump Administration is planning to launch a trade war against the rest of the world today. I understand that is scheduled for 4pm EST this afternoon as the RTH market closes.

If Trump is right then, unlike any other instance where tariffs have been imposed in history, US trading partners will absorb the cost of tariffs and in effect the tariffs will be a tax on those trading partners for the privilege of trading with the US, while the decreased competitiveness of imports, even though those import prices will not have risen, will rebuild the US manufacturing base.

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Four Bear Markets and a Setup

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As I’ve been working on my post today to look at downside patterns on US equity indices I have realised that this too needs to be split into two posts, so this first TA post will just look at the historical and very compelling current setups on SPX, while the second post will also look at the current setups and targets on QQQ, DIA and IWM.

In my last post overnight, Brave New World, I was looking at the economic reasons why I think that the planned tariff war on the world due to start tomorrow may have a very serious economic impact, particularly on the US economy.

In this post I am looking at last four big bear markets / crash setups on SPX and how they played out, and looking at the setup and targets currently on SPX if we are about to see something similar play out here, as I think we well might.

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Brave New World

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I’ve been mulling over how to do this post for a while because I don’t want to offend readers who might be very sensitive to any criticism, direct or implied, of the Trump administration, and I tend to stay away from any political discussions. However, any objective review of the likely effect of some of that administration’s policies requires an honest discussion of those policies and their likely impact.

Given that I now believe that the odds of seeing a serious bear market this year are high and that a full market crash is increasingly on the cards. I need to do that objective review, and my apologies if anyone is offended. I am just describing the geopolitical and economic realities here as I see them and am not planning to make political commentary a regular feature in my analysis going forward.

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Downside Targets Update

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Two weeks ago today I wrote a post looking at the case for a rally on US equity indices in the 12 trading day window into April 2nd, the planned day for US tariffs to be extended to most US trade partners. That rally delivered but wasn’t quite as strong as I hoped then, and I wrote another post a week ago in which I was looking at the bear flags forming on the US indices and talking about those moves topping out on Tuesday or Wednesday last week. On Wednesday morning I wrote a third post calling a likely high within those bear flag patterns and sketching out in arrows my preferred path from there.

That path was looking good but my hoped for high retest failed on the bad inflation numbers on Friday and this morning the bear flag targets at the retests of the 2025 lows on SPX, QQQ and IWM were hit. The bear flag target at the retest of the 2025 low on DIA is still outstanding but likely gets hit after the current oversold rally on the US indices ends.

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