Stock Market Direction Update and What I Have Been Up To...
Stock-Markets / Stock Market 2017 Jun 28, 2017 - 12:35 PM GMTBy: David_Petch
I had a number of people email requesting what I have been up to (did I die, am I ill) so here it is...
Back in April 2016, after being a part of TreasureChests for 13 years I decided to hang up my pen and pursue other things. As many know or do not know, TreasureChests is shutting the doors at the end of this month. It was a pleasure working with Captain Hook and we still keep in contact on a regular basis to discuss what is going on with the stock markets. Since I have been busy the past year with a side project that is morphing into something bigger, I miss not writing…so here is an update.
Life is a journey and in order to grow and evolve, people must continue to learn and put themselves in new situations. The broad stock markets of the US have failed to correct and the chiral Inversion of the Contracting Fibonacci Spiral I wrote about, it appears that things will climb higher into 2018, 2019 and 2020 before peaking. With this in mind, there is a chance for making money…or getting money for a company if the idea is properly presented. The following technical blurb describes why there is a limited window to move for starting accompany, so please bear through this to understand…I originally had an article titled “The Contracting Fibonacci Spiral” published in the April 2013 issue of Technical Analysis of Stocks and Commodities, but failure to move lower that year indicated it had a Chiral Inversion (http://www.safehaven.com/article/31530/chirality-and-chiral-inversions-in-stock-market-cycles ). Seeing how the stock markets are behaving at present, this crazy idea seems to be firming up…it remains a hypothesis and only time will show how it truly evolves to its point of singularity. Based upon the pattern, lows should be established around mid 2018 and 2019, with the final big top in 2020. Play accordingly, knowing that between 2020 and 2024, things will be extremely rough financially. For anyone who has not read about the Contracting Fibonacci Article or the Chiral Inversion it transformed into, I would highly recommend reading about it…I took a lot of flack for it back then and only now after I revisited it recently, it is essentially behaving as expected which made me realize that a narrow window exists to try and start a company.
Last summer out at the lake over a few glasses of wine, I pursued deeper into a niche biotech market that has taken the wrong molecular design, drug delivery, formulation, marketing and logistics planning over the past number of decades and decided to start a biotech company. My entire education is science based (BScH and MSc) so learning anything new in this area just requires the learning curve. The further one goes down the rabbit hole, the stranger things become and the greater some problems become realized, especially when crafting patents.
Since this revelation, three other cofounders were found and now we are in the process of completing our Prospectus, development of the long-term business plan and of course, developing a web site. I will not reveal the name of it at this point in time due to staging, but I can state that it will be extremely disruptive to large cap companies in the space we will be entering. The knowledge of the stock market I gained over the 13 years at Treasurechests really aided in becoming CEO/CSO of our company that will provide understanding of when to raise capital and how to ride the wave of psychology. I want everyone to realize that acquired talents learned yesterday and today can be applied tomorrow in ways one never would have dreamed of.
Stock Market Direction
How can I not at least put up one chart to clarify where things are headed for the S&P 500 Index? Above is the monthly chart of the S&P 500 Index. Back in 2006, I wrote an article titled “The Technical Palette” describing the methods of analysis I forged…multiple layering of Bollinger Bands and their interactions for determining tops, bottoms and oversold/overbought conditions and use of Full stochastics with Fibonacci based settings, 21,8,13, 34,13,21 and 55,21,34 for spreading out the %K and %D lines to improve buy/sell signals. For uptrends, lower 21, 34 and 55 MA Bollinger Bands will curl down in sequence, followed by curling up to ultimately indicate a topping pattern or bottoming pattern. At present, we can see the lower 21 MA Bollinger Band has curled up, while the 34 MA Bollinger Band (BB) is declining. Note that since early 2015, the lower 55 MA BB has been in an uptrend, with no isignof curling down. From empirical analysis, it would take approximately 2.5 to 3 years for the lower 55 MA Bollinger Band to begin curling down and then curl up. Everything has to occur in sequence and since the it has not happened in sequence with the 21 and 34 MA BB’s, these two will again have one more oscillation before the 55 MA BB eventually curls down and then up to indicate a top, likely in early to mid 2020.
Stochastics 1, 2 and 3 in order of decline are seen at the base of the chart, with overextensions in every case. Given the overbought nature of the S&P 500 Index based upon stochastics, Bollinger Bands will play a more critical part of determining when a top is in place. Regarding trying to place an Elliott Wave count on this…refer to Glenn Neely’s analysis as nobody can touch his work.
With low public participation, a record number of bears and a high put/call ratio at present, there is no sign of a top in the stock market yet. Knowing this is knowing that the next few years stand to bode well for those wishing to start companies with a great idea...or invest in the stock market.
Trump and Global Politics
Trump is an idiot, but he is better than Hillary. People voted Trump because they were sick of the system…His vocabulary is limited and I am sure his picture will be placed beside the definition of a narcissist in the future. His flat tax idea was fantastic, but the problem is that most of the people in Congress do now want that pushed through…only a collapse in the system will collapse current government mentality.
One area that was hit hard with Trump (and unfortunately expected) was Science. The founding fathers of the US purposely targeted a secular government so that individual religious beliefs did not affect others but unfortunately, the Bible is trumping science and common sense with the current government. There are six US State that teach Creationism alongside Evolution…amazing that the observations of the world from 2000 years ago based upon goat herders is being taught in public schools. With the Snow Flake generation of the US, I am certain that there will soon be University courses on topics like “PSTD’s Experienced by Elves after the Passing of Christmas” and “Lifestyle of the Easter Bunny”.
Religion has been causing most of the problems seen around the globe, with Islam radicals pushing for suppression of women along with any non-believers. In Canada, there have been groups in Montreal trying to get pork banned from school cafeterias. Islam is a younger religion that Christianity…so please remember that women were only allowed to vote in Canada in 1914 (A Christian country) and still face workplace issues. We all need to see the world for what it is…suppression of knowledge and teaching incorrect ideologies is not going to move humankind forward. We all need to get along and continue to push for equality and freedom of speech for all within a secular based society. Seeing things for what they are rather than holding onto incorrect ideas (such as gold bugs that are permanently bullish and now in financial ruin) is important to make correct decisions in life. A broken clock is right twice a day so that does not make some ideas right just because the clock lands there.
With volatility in the stock market expected to increase in the coming few years, so will volatility amongst the general populations globally. Remain focused and ignore the noise…doing this will allow one to see the true market trend and allow decisions to be made accordingly. Since I am no longer in the business of being a newsletter writer, I have two recommendations: Glenn Neely and Martin Armstrong. Glenn Neely is a brilliant market technician who took Elliott Wave to the next level with his NeoWave and continues to make great calls. Martin Armstrong is simply brilliant and has his AI services at www.ask-socrates.com .
It was actually quite enjoyable penning out this article…I will be back in the not too distant future with some form of market commentary. Be careful with commodities, as their patterns continue to be weak. Anyone with questions or comments can reach me at winnipegwarrior@gmail.com.
As an aside, the folks at Eliott Wave International in 2012 or 2013 tried to scoop me on my original idea of the Contracting Fibonacci Spiral, which was first published at least one year earlier after my article in Stocks and Commodities Magazine. They refused to retract and indicate I was the original discoverer of this concept. They did not have the internal capacity to understand the basis of chirality in nature which saw the cycle have a chiral inversion, so any wind of this from their firm has been dead ever since.
Back within 6 months to further discuss tales of the market…
David Petch
http://www.treasurechests.info
I generally try to write at least one editorial per week, although typically not as long as this one. At www.treasurechests.info , once per week (with updates if required), I track the Amex Gold BUGS Index, AMEX Oil Index, US Dollar Index, 10 Year US Treasury Index and the S&P 500 Index using various forms of technical analysis, including Elliott Wave. Captain Hook the site proprietor writes 2-3 articles per week on the “big picture” by tying in recent market action with numerous index ratios, money supply, COT positions etc. We also cover some 60 plus stocks in the precious metals, energy and base metals categories (with a focus on stocks around our provinces).
Disclaimer: The above is a matter of opinion and is not intended as investment advice. Information and analysis above are derived from sources and utilizing methods believed reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Comments within the text should not be construed as specific recommendations to buy or sell securities. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities as we are not registered brokers or advisors. Certain statements included herein may constitute "forward-looking statements" with the meaning of certain securities legislative measures. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the above mentioned companies, and / or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Do your own due diligence.
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