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.
From Hedge Fund Tips: AAII Sentiment Survey results are out this morning. Bullishness is now up OVER the 40 level – which usually marks market reversals. Bearishness has collapsed. In the S&P500 chart below I have noted those dates in the recent past where Sentiment was at similar levels (Bullishness ~40, Bearishness <30). You can follow along with the red circles on the sentiment results above.
I have a rather unique vantage point as the owner of this little corner of the Internet. People from various parts of the world know me by way of Slope as well as my show on tastytrade, and some of the bears among them (God love ’em) consider me their ursine patron saint, so when things are going badly (like, oh, the past six weeks nonstop) they reach out to me.
Well, last night, this is pretty much what I experienced:
Fear, as measured by the VIX volatility index, is less than half what it was just a month ago. LESS THAN HALF.
There’s something I’ve noticed on Slope that I find perplexing, a little troubling, and ever-so-slightly amusing. Whenever I write anything that seems to be a prediction, some people get their feathers quite ruffled. Indeed, it seems to kind of piss them off, and they pound their virtual fists on the virtual table and declare that no one can predict anything, and that it’s an arrogant waste of time to even attempt it.
I’m in the business of prediction. Principally, I use historical price charts to try my best to suggest what the future holds. That sort of thing doesn’t seem to bother folks. On the contrary, it’s kept Slope popular, to varying degrees, for nearly fourteen years.
However, when I make, shall we say, textual predictions, some people object. I guess all I can say to that group is………you might as well stop reading the post now, because I wanted to offer up a few speculations about what’s ahead. I am by no means a futurist or an expert in societal trends. By far my biggest “this is what’s coming” success was the 1983 book I wrote, which I’ve mentioned here before, called The World Connection, which predicted our online world with Nostradamus-like accuracy. (more…)
I think it’s only natural after a decline like Oct 10-11, 2018 for people to ask themselves a variety of questions. “Is the bottom in or not?” “Should I buy now or is it going to roll over again?” and “If it is going to roll over, how far does price bounce before rolling over?”
The question I’m asking today is, “After a decline that coincides with a $VXV:$VIX ratio under .90, how long does it take for a retracement to be put in and price to start rolling over?”
Based on the conclusions of my previous post, the likelihood of another test of the lows in approximately two months time appears to be high, even after a retested low has been put established. On the path to two months from now, however, we still have to navigate a market day to day. The paths after the ratio low signal triggered varied so much, it’s hard to really come up with anything consistent and even if there was a pretty clear repeated path, I wouldn’t want to suggest that there weren’t other paths that price could take, even a path that’s never been taken before because anything can happen. In most cases, the final peak before a decline to at least the first low if not a lower low (or bear trap) took 4-6 weeks to be reached. In the near-term, however, they all had an initial peak relatively quickly which provided a boundary for a chop zone (trading in a range). This is what I want to explore. (more…)
