Stock market technical analysis

stock market technical analysis

Stock market technical analysis on its own produces mediocre results. However, when combined with Mass psychology the results are outstanding. From a long-term perspective, this confirms that the super trend of polarisation, loss of personal freedom and massacre of the middle class will continue roughly for 30 years in the West. If we are lucky, it might end in 18 years, but we would not hold our breath, as the trend to elect super idiots into positions of power is in full swing.

 

The MACD crossover (on the weekly charts) is a bit more pronounced now, so unless there is a black swan event, the Dow is on course to (at minimum) test the 37,5K to 38K ranges. Between now and the 1st quarter of next year, we expect sudden surges in volatility. The short to intermediate trend won’t change as long as the Dow does not end the week below 38.8K.

We have a hypothesis regarding market tops. As the market matures and moves closer to putting in a top, the weekly charts have more influence than the monthly charts. When we are in the final stages of the topping game, the daily charts take over and exert more pressure than the weekly charts. At this point, the weekly charts are leading the game, and this pattern usually starts to manifest 3-6 months before a top is in. The count for the weekly charts began in September. It will be interesting to see if this hypothesis pans out.

bnb chart anxiety index

Our anxiety index is another development confirming that the markets are likely to top in the 1st quarter of 2022. It is the first time in almost two years that the gauge has moved precariously close to the moderate zone. Even more, telling is the speed of this move; in less than 10 days, it went from the border (almost) of the hysteria zone towards the perimeter of the Moderate zone.

 

Historical Sentiment values

stock market readings

For the first time this year, we have three back-to-back readings where bullish sentiment is trading above its historical average. The first strong confirmation that the markets are going to put in a multi-week top next year. Market Update Nov 11, 2021

And just like that, as soon as volatility levels rose, bullish sentiment sheds 12 points. This indicates that while a strong to brutal correction is expected next year, it will likely be short in duration, as fear levels will spike into the next galaxy. The market has very few long-term investors today, most are fickle, and when the going gets tough, they press the pedal to the metal and flee to the nearest exit.

Every inflation expert stating the Fed has to raise rates will start to offer “me culpa’s” and beg the Fed to step in. The Fed will only be too happy to oblige. After all, that’s has been their game plan all along. Their new slogan probably is “debase or die”, with the masses fulfilling the dying aspect of the saying. For the Fed is willing to destroy everyone and anything that stands in its way. No organisation is too big to sacrifice.

Conclusion

Stock market technical analysis as stated below when combined with Mass Psychology does yield above average results. A lot of the proclamations we made last year and this year are coming to pass.

So far, the first part is coming to pass. Once the MACD’s complete the bullish crossover, we expect a mini feeding frenzy that will ultimately pave the way for the next top. Novice traders are about to get clobbered; “the term he got beaten within an inch of his live” comes to mind. Market Update Nov 11, 2021

Almost every asset class will get clobbered next year, and if the projected pattern pans out, we can expect a bloody carnage in the high-tech sector. Certain stocks in this sector have refused to pull back, but pullback they will, and when they do, all the fake bulls and baby men will understand the true meaning of this saying.

Bulls win some of the time, and bears win some of the time, but pigs always get slaughtered.

A Tactical Investor must never forget the statement put out in the last update.

Once again, remember, we never panic. A Tactical Investor is last to leave the room and the first to enter. We stroll in, and we stroll out; leave the running to the fools. Market Update Nov 11, 2021

For the next 45 to 60 months, more than ever, one will have to understand that volatility is a traders/investors best friend. But the term volatility will take on a whole new meaning starting next year. After the correction of 2022, expect the markets to experience massive moves in both directions. Some moves will appear like the end of the world is nigh. Still, only the astute investor will recognise opportunity masquerading as a disaster.

We would not be surprised if, after 2022, the Dow routinely experiences round turn moves in the 7K to 12K ranges within 12 months. Round turn implies the move from the low to the high. For example, if the Dow sheds 5K points but then ends the year 7000 points higher, the round turn move would equate to 12K points.

 

 

Other Articles of Interest

financial anxiety

Financial anxiety: Follow The Trend

Financial anxiety: Short-term market outlook Feb 2, 2023 The following projections were curated from the November 28th Market Update, providing ...
Read More
Investment Opportunity & Market Crashes

Investment Opportunity & Trading in the zone

Trading in the Zone: Mastering the Psychology of Trading Dec 30, 2022  Irrefutable Evidence that Crashes Equate to Investment opportunity: ...
Read More
worst 25 year period in stocks

Worst 25 year period in stocks?

Is It The Worst 25-year period in stocks? Dec 2022 No, it's not the worst 25-year period in stocks; it's ...
Read More
Copper outlook

Copper outlook VIA CPER

Copper outlook: To dance or Not to Updated March 2023 In the August 27 market update on the copper outlook: ...
Read More
Broad Market

Market Sentiment Analysis: Broad Market Review

Market Sentiment Analysis: Buy The Fear Updated Feb 2023 One has to understand the difference between the forest (broad market ...
Read More
existing home sales

Existing home sales

Nov 28, 2022 One can see that while the median price has been rising, new existing home sales have been ...
Read More
stock market crashes in history

Stock Market Crashes in History

Oct 3, 2022 A study of the stock market crashes in history reveals one upbeat fact; the ones that lost ...
Read More
stock market crash history

Market Crash History: The 1970s Era

Sep 26, 2022 An examination of any  Market crash history reveals one stunning fact. Investors that jumped in and bought when ...
Read More
Russia Update on Ruble Neon Gas and more

Russian Update: Ruble, Neon Gas and more

Russian Update 1: World's Top Performing Currency? The Russian Ruble, now the strongest currency in the World, has been trading ...
Read More
stock market rally

Stock Market Rally: Reality or Illusion?

Summer Stock market rally: To be or not to be? We expected the markets to correct last year, but it ...
Read More
Intelligent Investing Strategies

Intelligent Investing: Harnessing the Power of Data-Driven Approaches

Intelligent Investing: Navigating the Stock Market with Confidence To win, you have to have a stake in the market; it ...
Read More
trading volatility

Trading volatility: A whole New Stock Market Game

Trading volatility: Stick With The Trend Updated Dec 2022 Volatility will keep rising as we are in the battle of ...
Read More
stock market crash 2022

Stock Market Crash 2022

Stock market crash 2022: Reason No. 1 Updated Dec 2022 In addition to the many reasons we have provided in ...
Read More
Trading Journal

Trading Journal: The invaluable tool for traders

Trading Journal Nov 19, 2022 We will start by listing a series of quotes from recent market updates. If you ...
Read More
Trending markets

Market Trend Analysis: Only The Trend is your friend

Market Trend Analysis Updated July 2022  Trending markets currently favour value stocks and growth stocks that took a beating in ...
Read More
Stock market experts

Stock market experts know Nothing

 o Stock market experts focus on fiction, not facts Updated Dec 2022 Last week’s bullish readings dropped to 22, and ...
Read More
stock market technical analysis

Stock market technical analysis

Stock market technical analysis on its own produces mediocre results. However, when combined with Mass psychology the results are outstanding ...
Read More
market tops

Market Sentiment Made Easy: Sell Euphoria and Reap Rewards

Market Sentiment: Euphoria Equates To Market Tops Updated Feb 2023 Even though things are viewed as bad now, these times ...
Read More
lot size

Tactical Investor Lot Size

This was initially posted in the Market Update forum. The current version is being modified to reflect a potential change ...
Read More
Panic Buying

Panic Buying Equates to Fools Paradise

Panic Buying & Losses: Best bed Partners Updated Dec 2022  Panic buying can be contrasted with panic selling, in which ...
Read More
panic selling

Panic Selling: Buy The Fear & Sell The Joy

Many subscribers (mistakenly) assumed that we were stating that the markets were ready to Drop. And they started to close ...
Read More