Trading with point and figure

In this edition:

Eddie Tofpik - The Wall of the Worried

Andy Ash - Modi’s Gamble

Paul Mylchreest - The Dollar Illiquidity Threat

Marc Ostwald - About that China ‘devaluation’ and ‘debt crisis’

Stephen Lewis - Mr Trump’s Dollar Boost

Howard Jenkins - Too closer relationship?


Wishing all our readers a very Merry Christmas & Seasons' Greetings
and all the very best for a happy, healthy and prosperous 2017.


Marc Ostwald
Global Strategist
ADM Investor Services International Limited
 
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I spend a majority of every waking hour studying the stock charts. I came across this insanity just by being curious. This makes me fear for 2017 and the next few years. I expect the next major stock market collapse to begin in 2017. Let me explain, basically, if you take the late 1990's tech bubble move on the $SPY and add it to the 2003-2007 real estate bubble move in the $SPY you get a total net move of $163.25. Now speed ahead to the 2009 lows in the $SPY. From the 2009 lows to current highs, the $SPY has moved $161.00 points. If my calculations are correct, the $SPY will likely top out into the end of 2016 by moving up another $2.25. This would mean the tech bubble move + the real estate bubble would equal the exact move from 2009 to the coming highs on the $SPY at $231.00. This tells of a dark scary collapse coming with a downside target of $156-$157.50. I am extremely bearish for 2017.
from Gareth Soloway....ITMS
 
21d1ug2.png



Gareth Soloway chart
 
*** PLEASE NOTE: This will be the final update from me for 2016.
I will resume some updates on Monday 9th January, 2017

Wishing all our readers a very Merry Christmas & Seasons' Greetings
and all the very best for a healthy and prosperous 2017

---------------- ----------------

- Seasonally subdued trading to find some distraction in China commodity
data, Riksbank policy meeting, UK PSNB, Brazil inflation and US Existing
Home Sales

- US Existing Home Sales: some risk of a sharper correction after October
surge, underlying trend very solid

- Riksbank seen extending QE despite committee divisions on efficacy of
QE and negative rates

- Chart: China 10yr govt bond future

..........................................................................

********************
** EVENTS PREVIEW **
********************

A slightly busier in terms of scheduled data and events, though these will have to spring a major surprise to ruffle seasonally subdued markets. Sweden's 'inflation nutter' central bank, the Riksbank is expected to leave rate unchanged, but is expected to expand its QE programme by anything between SEK 23 Bln and SEK 60 Bln for H1 2017, this despite the clear divisions on the Riksbank policy committee about the efficacy of negative rates and QE, as seen in the October minutes. While inflation is clearly trending high, it remains well below the Riskbank's 2.0% target on both headline (1.4% y/y) and core (CPIF 1.6% y/y). Statistically, the UK has the latest budget data via way of the PSNB (expected to narrow modestly to £11.6 Bln vs the same month of 2015), Brazil is expected to see a sharp drop in annual inflation (6.69% vs. Nov 7.64% y/y), while the US has Existing Home Sales and New Zealand releases Q3 GDP this evening. The run of China rail freight and commodity export & import data would appear to offer a couple of points to note. Firstly Rail Freight volumes have accelerated sharply in Q4 after a protracted period of weakness, which suggests that the government's enormous fiscal stimulus (N.B. way more than anything being proposed by the US president elect) is still providing considerable stimulus to the economy. By contrast the commodity data above all highlight that not only does Chinese demand continue to be a key swing factor (and one notes above all the weakness in Copper product exports, raising further concerns about the hefty long position in Copper futures), but most significantly for the oil market, it clearly is having an ever greater impact in terms of oil product exports, as was more than amply demonstrated earlier in the year, when the initial oil price rally was derailed by the build-up of product inventories, above all gasoline, in no small part on rising Chinese output.

US Existing Home Sales are expected to slip a modest 1.8% m/m to a 5.50 Mln SAAR pace after jumping to a 10-yr high of 5.60 Mln in October, with some risks of a larger setback given the low levels of inventories, and perhaps the rise in mortgage rates. Be that as it may, the overall profile of housing demand remains very robust.


from Marc Ostwald
 
according to ITMS...it gets nasty above 2310
high so far 2280
target 1570
740 point drop
32% drop...ish

6500 ish drop on Dow
wow...
 
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ok...so,in theory 2310 is a major rez
the tank could come from
catastrophe..economic or political
or
yen strength/forced liquidation in carry trade
any other veiws..??
 
USDJPY
looks like it overshot rez
pulling back to 116.83-117.36 area...there now
should be supp in that area

ixtqjb.gif
 
we might get 20K today...if supp holds

there is a vertical count of 20140...might coincide with 2310 on spx

20140-20160 is poss equivalent to spx 2310. percentage wise..Dow is slightly more bullish than spx...so allow a bit of overshoot maybe to 20.3K

ugh......who knows
 
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chart is 6 box reversal..gets rid of alot of mess
price retraced into that pivot/breakout area
it needsa 42 reversal to get back a column of X's
firts rez should be 19845 area..then 19860/prev supp
19.9K is supp area
trend supp is our 19860 area/aqua
 
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