Thread: Bear Cave 2 (Bull Allowed)

A small excerpt from one of Steve Kaplan's updates.


This is a brief update for Friday early afternoon, February 26, 2016.


VIX: watch it retreat and then complete yet another higher low near 15


One indicator which is highly useful and almost completely misunderstood is VIX, which measures the average implied volatility of a basket of options on the S&P 500 Index. Historically, when a bull market is in its final stages, VIX will complete a multi-year bottom and will then begin to form a pattern of higher lows. A good example from the last decade was when VIX bottomed at 9.39 on December 15, 2006. Afterward, it made higher lows throughout 2007 and all the way until October 24, 2008, when it completed a top at 89.53. Although U.S. equity indices continued to grind lower through the first nine days of March 2009, VIX made a lower high in November 2008 and several additional lower highs, so that by the time March rolled around it was enormously lower than it had been at the October 2008 top; its most elevated level in March 2009 was merely 53.25--and that was on March 2, not March 6 or 9. This was a signal that a bull market was approaching. Notice that the same pattern has repeated again in the most recent bull market which ended in the second quarter of 2015 (yes, it's officially over, folks; the current rebound proves it), when VIX bottomed on July 3, 2014 at 10.28. Since then, it has made a huge number of higher lows, the last one being 14.45 on December 24, 2015 which was just over two months ago. Most likely, the next higher low will be somewhere around 15. When that happens, if you sold HDGE or other bear funds or made some U.S. equity index or technology purchases when I had recommended selling HDGE earlier this month, you can again gradually reverse direction by going back to the short side.

True Contrarian

HDGE link....Steve uses this fund because because if held 12 months it can be used for LT capital gains. That is not true for most short funds.

(HDGE) Ranger Equity Bear ETF | AdvisorShares


SevenSentinels ‏@SevenSentinels 11h11 hours ago
10 PM, February 29, 2016 Heading Towards Next Trade Op

https://twitter.com/sevensentinels

Excellent posts, robo. thanks.

A small excerpt from Steve’s latest update:

This is a brief update for Friday early evening, March 4, 2016.

VIX almost reaches its Christmas Eve lows

VIX slid to 16.05 in Friday’s trading, which is a level it hadn’t previously touched since December 29, 2015. VIX has been forming over a dozen higher lows since it had bottomed on July 3, 2014, which is characteristic of the period preceding a bear market and in the early stages of a bear market. In the late stages of a bear market, VIX will reach a multi-year top and will then begin to form lower highs. At each higher low for VIX, once we are in a bear market as we almost certainly are for most U.S. equity indices, it makes sense to add to short positions or to make equivalent trades by selling general equity holdings and buying funds such as HDGE. HDGE dropped to 10.92 on an intraday basis. The last intermediate-term bottom for VIX was 14.45 on December 24, 2015, indicating that VIX has roughly two additional points of downside potential which could be accompanied by modestly higher prices for U.S. equity indices. However, most of the rally has already happened. Investors who sold in January or early February and are just now “getting back into the market” will end up as disappointed as they had been when they were buying at the December 2015 peak, at the highs in June 2015, or at any of the other relatively elevated points along the way. Bear markets begin with numerous lower highs before they end up–often a year or more later–finally accelerating their downtrends. It could be a year or more before the S&P 500, the Russell 2000, the Dow Jones Industrial Average, and the Nasdaq finally collapse, although the next important correction could begin this month and will likely end several weeks later.

True Contrarian


$VIX - SharpCharts Workbench - StockCharts.com


$NAMO - SharpCharts Workbench - StockCharts.com


$SPX - SharpCharts Workbench - StockCharts.com


GDX - SharpCharts Workbench - StockCharts.com


http://stockcharts.com/h-sc/ui?s=GLD...15&a=444286946


http://stockcharts.com/h-sc/ui?s=%24...15&a=446310828

2016-2018 Is Looking a Lot Like 2007-2008 to Me | RealClearMarkets

March 21, 2016
Extinction Burst

John P. Hussman, Ph.D.

From a near-term standpoint, given a well-defined top formation extending back to 2014, and a strenuously overbought advance that has now carried the market to the arc of that formation, my sense is that the preceding paragraphs would be most satisfying if I were to say that all evidence supports expectations of an immediate collapse, and that crash risk is our most pressing concern (as it was just a few weeks ago). Frankly, that outcome would still serve us best.

But like last week, our near-term outlook actually remains fairly neutral.

That near-term outlook would shift to a hard-negative view at about the 1975 level on the S&P 500, which is where the full weight of market action would pile to the downside again. I also continue to view the 1820 level as a potential crash threshold.

Hussman Funds - Weekly Market Comment: Extinction Burst - March 21, 2016


Stocks

Equity Rallies Hiding True Market Situation | Talk Digital Network



$NYA - SharpCharts Workbench - StockCharts.com

VXF - SharpCharts Workbench - StockCharts.com

$SPX - SharpCharts Workbench - StockCharts.com

http://stockcharts.com/h-sc/ui?s=SDS...45&a=443233825


http://stockcharts.com/h-sc/ui?s=IBB...11&a=451117484

http://stockcharts.com/h-sc/ui?s=%24...29&a=449532649

http://stockcharts.com/h-sc/ui?s=%24...45&a=451466984

http://stockcharts.com/h-sc/ui?s=%24...74&a=449532684

http://stockcharts.com/h-sc/ui?s=UWT...14&a=444286233


Metals/Miners

http://stockcharts.com/h-sc/ui?s=GDX...58&a=445995792

http://stockcharts.com/h-sc/ui?s=%24...58&a=449116881

http://stockcharts.com/h-sc/ui?s=GLD...26&a=444286946

http://stockcharts.com/h-sc/ui?s=%24...33&a=449310106


What to Watch For in Gold and Gold Stocks
By: Jordan Roy-Byrne | Fri, Mar 25, 2016

http://www.safehaven.com/article/409...nd-gold-stocks

https://www.goldbroker.com/news/the-...ueeze-mode-929

http://www.clivemaund.com/article.php?art_id=68


A small excerpt from Kaplan’s latest update.

This is update #2154 for Thursday late afternoon, March 24, 2016.

As has been the case in recent months, most emerging-market and energy shares have moved lower along with general global equities and usually by greater percentages. Eventually, these should be able to diverge positively during general equity pullbacks, but for now energy and emerging-market securities will outperform primarily by gaining much more on days when general equities are higher rather than by nearly always moving upward. Gold and silver mining shares continue to be more independent and to serve in their reliable role as leading indicators, by completing intermediate- and even short-term highs and lows before most other assets. As an example, after having completed an all-time bottom of 16.87 on January 20, 2016 along with many other assets, GDXJ has choppily rebounded with recent higher lows of 21.14 on February 10, 25.40 on March 15, and could be in the process of forming another higher low during the early spring. It does look incredibly tempting for gold to break below 1200 and/or for silver to fall below 15 to knock out recent excited long-side momentum players, so that may occur and if it does so will likely happen during the next few weeks (or days). Like a lion, you have to select your targets and be prepared to strike when the time is ideal and just about everyone else is going the other way.

For future reference, it is worth noting that GDXJ and similar funds, when they achieve higher highs, do so only fleetingly, and then return several weeks later to set new higher highs. This pattern is likely to continue and to become even more exaggerated in the early months of 2017 when these funds will be widely advertised as “the hottest stocks of last year.” Thus, when it becomes time to sell, it will be a good idea to do so gradually whenever they are enjoying upward spikes and most investors are eagerly buying them into strength. With most volatile assets, it is necessary to be simultaneously gradual and aggressive in accumulating and discarding them, because their lowest and highest levels will be visited only briefly and will soon be followed by significant moves in the opposite direction.

http://truecontrarian-sjk.blogspot.com/


I'm flat!

SevenSentinels ‏@SevenSentinels Mar 24
12:10 Markets Stable Ahead of Holiday - "The Lull Before the Storm"

https://twitter.com/sevensentinels


Atilla Demiray ‏@xtrends Mar 23
The four most dangerous words... http://www.xtrenders.com/2016/03/the...ous-words.html … via @xtrends

https://twitter.com/xtrends

March 28, 2016
Run-Of-The-Mill Outcomes vs. Worst-Case Scenarios

John P. Hussman, Ph.D.


With the S&P 500 Index at the same level it set in early-November 2014, and the broad NYSE Composite Index unchanged since October 2013, the stock market continues to trace out a massive arc that is likely to be recognized, in hindsight, as the top formation of the third financial bubble in 16 years. The chart below shows monthly bars for the S&P 500 since 1995. It's difficult to imagine that the current situation will end well, but it's quite easy to lose a full-cycle perspective when so much focus is placed on day-to-day fluctuations. The repeated speculative episodes since 2000 have taken historically-reliable valuation measures to extremes seen previously only at the 1929 peak and to a lesser extent, the 1937 peak (which was also followed by a market loss of 50%). Throughout history, at each valuation extreme - certainly in 2000, 2007 and today - investors have openly embraced rich valuations in the belief that they represent some new, modern and acceptable “norm”, failing to recognize the virtually one-to-one correspondence between elevated valuations and depressed subsequent investment outcomes.



Wall Street analysts talk endlessly on financial television about low interest rates “justifying” current valuations, without completing the story that even if this were true (and it’s not - see the links below), these rich valuations still imply predictably dismal future returns on stocks, particularly on a 10-12 year horizon. The fact is that the relationship - the direct mapping - between the most historically reliable valuation measures and actual subsequent market returns hasn’t changed a bit in nearly a century.

Hussman Funds - Weekly Market Comment: Run-Of-The-Mill Outcomes vs. Worst-Case Scenarios



My LT chart based on many data inputs....

IWM - SharpCharts Workbench - StockCharts.com

Why watching IWM and the NYSE is very important during long in the tooth Bull Markets. Watch for lower highs. Once they are seen ( markers printed) stay more nimble in your trading or moves in your TSP account. Bull markets are excellent for trend traders and long term investors, and Bear Market are great for swing trading.

Have a nice weekend.

2000
$SPX | SharpChart | StockCharts.com

2007

$SPX | SharpChart | StockCharts.com

2018

$SPX | SharpChart | StockCharts.com

Gold and the Miners...

GLD | SharpChart | StockCharts.com


2007 and gold...

$SPX | SharpChart | StockCharts.com

http://www.traders-talk.com/mb2/inde...9199-patience/

Robo! Long time, buddy.

Originally Posted by tsptalk

Robo! Long time, buddy.

It has been awhile since my last post. I stop in a few times a week to look things over. I always enjoyed reading over your market thoughts.

GLD | SharpChart | StockCharts.com

$SPX | SharpChart | StockCharts.com

nnuut,

My attached images are hard to see. Is there a way to make them larger when I post them?


https://seekingalpha.com/author/viki...gular_articles

https://seekingalpha.com/author/hebb...gular_articles


https://seekingalpha.com/author/stev...gular_articles


https://www.jeffclarktrader.com/market-minute/archives/

I'm currently long silver.

USLV | SharpChart | StockCharts.com

Sentiment Speaks: The Metals Manipulators Are Being Manipulated

Summary
GLD has the potential to outpace the market this year.

Please do not use manipulation as an excuse in the metals market.

Upcoming expectations for GLD.

This idea was discussed in more depth with members of my private investing community, The Market Pinball Wizard.

For those that follow me regularly, you will know that I have been tracking a set-up for the SPDR Gold Trust ETF (NYSEARCA:GLD), which I analyze as a proxy for the gold market. I also believe that gold can outperform the general equity market once we confirm a long-term break out has begun, and I still think we can see it in occur in 2018. This week, I will provide an update to GLD. While I have gone on record as to why I do not think GLD is a wise long-term investment hold, I will still use it to track the market movements.

But, before I give you my broad view of the GLD, I just want to make a point about silver.

https://seekingalpha.com/article/416...rs-manipulated

I trade using Sentiment and cycles...

Bearish Shift for Stocks

Stocks broke lower on Tuesday shifting the odds towards a left translated daily cycle formation.



Tuesday was day 16 for the daily equity cycle. Had stocks broke higher on Tuesday that would have allowed us to construct the daily cycle trend line. Instead, stocks broke lower to close back in the volatility zone. Stocks also lost the 10 day MA and closed below the lower daily cycle band. Closing below the lower daily cycle band continues the daily downtrend. It also signals that the intermediate cycle is in decline. A left translated daily cycle formation will assure us of a left translated weekly cycle formation. And a left translated weekly cycle formation impacts our yearly cycle framework, which I will discuss in this week’s Weekend Report.

https://likesmoneycycletrading.wordp...ft-for-stocks/

$SPX | SharpChart | StockCharts.com