Dow: Deferred Move

The deferral of a move down to a range between 34389 and 34559, as noted on December 17, 2021, was initiated during the overnight futures trading session prior to markets opening on Monday, December 20, 2021. Upon completion of this decline to fill previous gaps, a move to 38,000 is still expected based on Market Maker accumulation activity and daily engrbytrade™ Dow calculations.

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Dow: Brief Decline

Chart courtesy of StockCharts.com.

Underlying data indicates Market Makers were engaged in a meaningful level of accumulation at the close on December 14, 2021.  This accumulation relative to daily engrbytrade™ Dow calculations indicates positioning within a broadening formation shown above will result in a brief decline to a range between 34389 and 34559 in the futures market before moving to higher levels.

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Dow: March 2022

When the Senate approved a Continuing Resolution it deferred the start of a market decline noted on November 30, 2021 to the first quarter of 2022.  This approval action aligns with the 1929 peak structure and would place a Dow peak near 38,000 by March 2022. Pending any further action by Congress or the Fed, a significant decline would follow the March peak. Daily engrbytrade™ Dow calculations will track the progress of this move.

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Dow: 83% Update

On November 1, 2021 the Dow: 83% post noted that the Dow would start a decline on November 8, 2021.  Congress passed the $1.2 trillion infrastructure bill on November 6, 2021. This was followed by the Dow peaking on Monday November 8, 2021 with a new all-time high while a significant number of very large block trades occurred between November 8, 2021 and November 9, 2021. Prior to this move, daily engrbytrade™ Dow calculations shifted to indicate the Dow will continue developing a declining structure. The chart shown below provides an update to the rising wedge discussed on November 1, 2021. As of Friday, November 19, 2021 the Dow landed on the 83% mark and is expected to continue moving lower.

Stock chart courtesy of StockCharts.com.

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Dow: 1929 vs 2021 Peak

The Dow hit an all-time high of 36565.73 on November 8, 2021.  Prior to reaching this peak, calculations indicate the Dow repeated a unique set of daily structures similar to what occurred between July 29, 1929 and the peak on September 3, 1929. Daily Engrbytrade™ Dow calculations indicate the Dow will continue to develop a declining structure similar to what occurred between September 11, 1929 and October 4, 1929. The current decline is expected to continue into mid-December 2021.

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Dow: 83%

Over the last three years, one key trait of the Dow (and S&P500) that stands out has been the rising wedge format with a consistent drop point on the 83% (+/-1%) mark, as shown below.  The Dow is expected to peak by November 4, 2021 (+/- 1 trading day) followed by a sharp decline starting the week of November 8, 2021.

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Stock chart courtesy of StockCharts.com

 

Dow: Daily Calculation Changes

History shows that a stock market collapse is expected to follow Blackstone’s next major effort to launch an IPO for Building Materials Europe BV in 2022.  It is also expected this IPO could be pulled back into 2021 in order to line up with interest rate hikes, and the Fed’s scaling back of central bank bond purchases.  The reason for a 2021 IPO is based on the following:
1. The Blackstone Group $4.133 billion IPO occurred on June 21, 2007 prior to a long market decline and collapse going into 2009.
2. Blackstone was involved in the Aramco IPO which was accelerated to start trading on December 11, 2019, just before the 2020 stock market collapse. Gary Quin (North Atlantic Acquisition Company) helped Blackstone with the Aramco IPO.

Other short term planning elements include:
1. On September 23, 2021 it was reported that Jerome Powell said the central bank could begin scaling back asset purchases as soon as November 2021 and complete the process by mid-2022.
2. Bank of England policymaker Michael Saunders made an announcement to get ready for “significantly earlier” interest rate rises due to inflation pressure.
3. Goldman Sachs is expecting a huge market melt-up in the coming weeks.
4. Distributions continue, as it appears central bankers, investment bankers and investment management firms are coordinating a final move similar to what occurred between August 13, 1929 and September 3, 1929.
5. Engrbytrade™ daily Dow calculations indicate a shift has occurred that would support a move similar to that of March 4, 2021 to April 12, 2021. This move would allow the Dow to hit 38,000 in a very short period of time and align with the original Engrbytrade™ perspective.

Update note:
It looks like Blackstone found a way to leverage $1.2 billion before markets reach their peak.
https://www.reuters.com/article/marketsNews/idUSL4N2RG3H0?il=0

All that is need now is for the Fed to stop buy bonds and the Bank of England to start raising interest rates.

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Dow: Distributions Continue

On June 5, 2020 a long-term process was started to distribute large quantities of stock from hedge funds, banks, brokerage firms and Market Maker trading accounts to retail investors, pension funds, etc. Within the Dow 30 group, every stock has had significant distributions, as described by Richard Ney, during periods when prices moved sharply higher.  As the economy continues to collapse, many of the large block sellers on Wall Street will be out of the market and retail investors will watch the value of their investment accounts dwindle while stock markets decline.  The main stream media will be used to bolster confidence in the markets while pension funds are forced to sell when prices drop and they cannot meet their obligations. This process is no different than what occurred prior to previous market declines, such as 1929, and 2008.

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