LunaticTrader

Investing with the Moon

Outlook for week of March 19

Posted by Danny on March 18, 2018

Outlook for world markets with my brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. It comes as a daily html file covering over 3000 stocks and ETF. You can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | 2 Comments »

Outlook for week of March 12

Posted by Danny on March 11, 2018

Outlook for world markets with my brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. It comes as a daily html file covering over 3000 stocks and ETF. You can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | 3 Comments »

Outlook for week of March 5

Posted by Danny on March 4, 2018

Outlook for world markets with brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. Comes as a daily html file covering over 2700 stocks and ETF. To see what you get you can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | 2 Comments »

LT wave for March

Posted by Danny on March 2, 2018

Just a quick message today to get out the LT wave.

Our wave did OK in February.
The month was as volatile as the wave projected and the major swings lined up with the wave pattern more often than not. Expected strength around the 5th did not show up, other than one good rebound day on Feb6, and the market declined straight into the expected bottom value on the 11th (which was a Sunday). This was followed by a strong week right into our expected peak on the 17th. Weakness in the 3rd week came in the form of sideways churning and then we got a few good up days in the last week. The final days of February did not show expected strength and this means March is starting on a weak foot.

Here is the LT wave for March:

ltwaveMar2018

A strong period is projected until around the 5th and followed by a prolonged weak period until the 26th. The final week of March looks better.
Peak LT wave values come on the 3rd and the 28th. The lowest value of March comes on the 12th.

Good luck.

Posted in Market Commentary | Tagged: | 2 Comments »

Outlook for week of February 26

Posted by Danny on February 26, 2018

Outlook for world markets with brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. Comes as a daily html file covering over 2700 stocks and ETF. To see what you get you can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | 2 Comments »

Outlook for week of February 19

Posted by Danny on February 18, 2018

Outlook for world markets with brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. Comes as a daily html file covering over 2700 stocks and ETF. To see what you get you can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | Leave a Comment »

Outlook for week of February 12

Posted by Danny on February 11, 2018

Outlook for world markets with brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. Comes as a daily html file covering over 2700 stocks and ETF. To see what you get you can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | Leave a Comment »

LT wave for February

Posted by Danny on February 5, 2018

Markets have finally started a pullback. We did get a 1% down day for first time since August and we also got a 2% down week for the first time since Sep 2016. This means we are starting to see more volatility, but that doesn’t mean this bull market is over already. See my recent article.

Here is the current S&P 500 chart:

^SP500 (Daily) 4_27_2016 - 2_2_2018

No major trend lines have been broken so far, but all my indicators are pointing down now. The Earl (blue line) peaked out a week ago and is dropping fast. The slower Earl2 painted a major peak a few days ago and is nowhere near bottom territory. The MoM indicator has also turned down after reaching the maximum euphoria +10 for a few days. This is not how a good buying opportunity looks like, but we are entering a lunar green period and I do expect some strong rebound days, but probably not new highs any time soon.
I would just wait for the dust to settle and once my 3 indicators start bottoming out we can look for new buying entries.

The LT wave did poorly in January. Expected strength in the first weeks panned out ok, but that strength continued well into the projected weak period. Those gains were given back in the last week, so it wasn’t too bad after all. But the timing of peaks and bottoms didn’t match.
Here is the LT wave for February:

ltwaveFeb2018

It looks very volatile with alternating stronger and weaker weeks. Peak LT wave values come on the 5th and 17th. And the bottom values are projected around the 11th and the 23rd. I have no idea how this will pan out. The market may just dance around within the wide range that is set by the recent January high and the possible low that we get in early February.

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The bitcoin crash

Posted by Danny on February 5, 2018

All eyes have been on Bitcoin BTC and other crypto currencies recently. After reaching a peak near $20000 BTC is now down to $8000. So what’s next?

Here is what I wrote about bitcoin last August:

A sustained breakout above $4000 that quickly heads for $5000+ would start a parabolic move like in 2013. And then it can go above $10k. A failure to do so would probably give us a peak near my $4246 target and be followed by a significant decline when traders notice that the steep rally has ended.
Both scenarios have 50/50 chance at the moment, so if you hold bitcoin from a much lower cost base then I would sell some and hold the rest at zero cost base. A tulip mania type move is possible here and then bitcoin could reach $10k or $20k before a big panic.

Here we are. BTC reached $20k and is dropping quickly, but investors are not really panicking (yet) and that’s a reason for concern. So, let’s have a good look. Here is an update of the long term chart I posted in August:

bitc_m

The rate of change is slowing down, which is normal after a move of this magnitude. The best case scenario is now a continued climb within the more sustainable pale green trend channel. But that would mean a drop to $2000 if the lower bound of this channel is to be tested. A failure to hold this channel would probably tell us that BTC is going to near zero. That’s the big picture.

Of course, Bitcoin has come back from similar drops on several occasions. But that’s the problem here. Too many investors/speculators seem to believe that will happen again and that’s why there is little or no panic, even after a 60% crash. Many traders are just doubling down on their losses, encouraged by “expert” predictions that keep talking about $50k, $100k BTC in the near future (e.g. https://www.buzzfeed.com/rabbiyitziweiner/21-bitcoin-experts-share-their-predictions-about-t-37p3h)

Small investors’ enthusiasm and confidence has become too high and that never ends well. As I pointed out on Twitter near the highs in December, Bitcoin has become more popular than SP&P 500 ($SPY) on sites like Stocktwits:

10 Days later BTC printed its current peak. But traders’ appetite for BTC has not cooled down on Stocktwits. The 7 day average message volume is now regularly above 30,000 and there are 85,700 people who are watching BTC. That’s more than the 73,500 investors who watch SPY (S&P 500 etf) on the site. By the time BTC finds a real bottom I would expect those numbers to be a lot lower.

Ongoing popularity in the face of a significant drop is usually a sign that there is more pain to come. This has happened before in other popular manias and it typically ends in a similar fashion. A first 50% crash is met with denial and after a few months of stabilizing prices (which many traders interpret as a last chance to buy before the next explosive rally) the so-called “waterfall declines” start, often ending 70-90% below the peak prices.

Classic example include the Dow in 1929:

dji_w

Gold in 1980:

gold_w

Nikkei in 1990:

nikkei_w

Nasdaq in 2000:

nasd_w

And even individual stocks or sectors. Remember 3D printing in 2014:

ddd_w

We always see the same thing. A huge run-up that triggers traders’ imagination of easy riches followed by a 50% crash that is seen as the next great buying opportunity. A few months of stabilizing and rebounding prices convince the remaining skeptics that the bull market is continuing. And that’s how the stage is set for the second phase of the crash.

If Bitcoin follows the same pattern by bottoming in the coming weeks followed by what looks like a healthy rebound then remember those charts and be careful. I will keep posting my observations on Twitter until I do another post on crypto here on the blog.

Good luck to all.

PS: Good question by a reader: Could it be that BTC moves quicker and that we are already in the waterfall declines? A: Yes, that’s possible. Here is a daily chart, 50% drop and a one month rebound:

bitc

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Outlook for week of February 5

Posted by Danny on February 4, 2018

Outlook for world markets with brief comments for next week.

Click the “Expand” button (bottom right) to watch in full screen mode.

If you have any trouble to see the presentation below, then click here.

For shorter term trading and more optimal entries there are daily reversal levels, which are available by monthly subscription. Comes as a daily html file covering over 2700 stocks and ETF. To see what you get you can pick up recent free samples on this page. Instructions for use are included. Give it a try.

Posted in Market Commentary | Tagged: , , | Leave a Comment »

 
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