Friday, January 21, 2022

#USStocks Review

US Stocks Review
Investors trying to interpret the composite trend tend to be confused by trading noise. While trading noise contributes to the long-term trends, it does not define them. Human behavior tries to explain trading noise as a meaningful trend. This confuses the majority. Confusion contributes to their role as bag holders of trend transitions.

The global economy and stocks began behaving strangely in late summer of 2019. Repo rates spiked unexpectedly. Few acknowledged it. Anyone looking for a return to “normal” market by fundamentals will likely be disappointed in the coming years.

Stocks crashed in early 2020. Relative performance within the stock market suggests a reallocation of resources away from old to new economic plays. The old norm of “Made in USA” is not coming back. Manufacturing, design, and information collection will be borderless. Citizens will struggle to maintain their liberties and rights without oversight and intervention under this economic backdrop.

Rising stocks as the global economy declines is a real possibility. Investors blame the Fed for the stock market's distortion of reality. The Fed, contrary to popular opinion, is not that powerful. It cannot control the world's capital flows. The invisible hand, the true driver of market and trends, is redefining the world as the core economy passes from North American to Asia.

Subscriber Comments

I know most of the egos on Twitter won't like the comment that the COT data works. The value of the data, as subscribers know, is how it's manipulated and presented. The S&P 500's bearish energy builds in 2021 were early. That happens. DI & DI2, currently -51% and -27%, continue to fall as prices decline.  Oh shit.

The Nasdaq 100's powerful bearish energy builds, however, was spot on. DI and DI2 triggered a concentrated bearish energy build in late December. Bearish concentration still exists today, yet nobody is talking about. Bet they start talking about it this weekend.

S&P 500 DI

Nasdaq 100 DI

Subscribers should (better) understand the bearish risks unfolding. Please don't act surprised. The Timing A Correction/Crash Section reached 70% a week ago. We talked about. Please watch the Matrix Update Reviews.  Concentrated bearish energy builds have been popping up in the S&P 500, Nasdaq 100, and Russell 2000 for weeks.

The composite Equity DIs are -32% and -20%. -40% represents the cutoff for bearish concentration. These numbers fell as prices decline! The title of the last Russell 2000 Review was Oh Shit. What else can we do?

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