Category: Dow

Between June and November, 2024 several large NVDA block trades crossed the tape above 119, as shown in the first chart. It appears Market Makers are conducting a merchandising operation by distributing stock to intuitions, pension funds, etc. Prior to Market Makers, Specialist performed the same operation.

“The cultural response of most investors is based on the assumption that “if somebody is buying, somebody is selling; not for a moment is it recognized that, in most cases “if somebody is buying,” it’s the specialist who is selling; and if “somebody is selling,” it’s the specialist who is buying.
Richard Ney, Wall Street Gang, 1974, page 150

Based on trades within the NVDA ascending triangle, a move upward would be expected going into December 2024. The following Fibonacci charts show today’s NVDA structure is very similar to that of CSCO in 2000. It should also be noted that overall, a market peak is expected in December based on the recent Buffett Indicator Review on November 28, 2024.

This information is for educational purposes only and it is not advice or a recommendation.
Scanning for block trades should be available on most major trading platforms.

Charts courtesy of StockCharts.com.

Disclaimer

As of November 27, 2024 point 3 on the following NAAIM Exposure Index evaluation is in a position similar to where it was on November 22, 2023. This is based on the number of big block trades within an ascending triangle between September and November 2024. A similar big block trade pattern occurred within a falling wedge between September and November 2023. Apple is shown below to illustrate this. Investor optimism is moving higher, but it has not moved into the extreme greed range. It appears there is still room to move upward going into December 2024.

Note that this information is for educational purposes only and not a recommendation.

Stock chart courtesy of StockCharts.com.

Disclaimer

On October 20, 2024 it was noted that as of August 31, 2024 the Market Valuation to GDP was 209%. As of November 9, 2024, the Buffett indicator valuation metric stands at 209%. This is above the November 2021 value of 197%. It is significantly higher than the September 5, 1929 value of 130%. For additional information on this topic, John P. Hussman, Ph.D. provides an in depth perspective in his November 2024 market blog.

With respect to positioning of markets, the last quarter of 2024 is still expected to be a market peak period. This is based on the Buffett indicator valuation being in a +2.2 standard deviation range. During this time frame volatility is expected to increase as markets typically move higher in December before they decline.

Note that this information is for educational purposes only and not a recommendation.

Charts courtesy of StockCharts.com.

Disclaimer

As of November 21, 2024 the ICE BofA US High Yield Index Option Adjusted Spread Index was 2.61. This is very close to where it was on January 24, 2007 when the index hit 2.630. Using this index reading for some insight to a path forward, a comparison was made between 2007 and 2024. This comparison provides similarities shown in the following S&P500 charts. The 2022 to 2024 chart structure is a smaller replica of what was developed between 2001 and 2007. Based on the ICE BofA Index readings and 2007 S&P500 chart, a brief upcoming decline should be expected before a market rally begins. After the short sharp decline on February 27, 2007, tech stocks started to rally until the end of 2007. It appears there is still room for markets to move higher.

Note that this information is for educational purposes only and not a recommendation.

Charts courtesy of StockCharts.com.

Disclaimer

As of November 20, 2024 point 3 on the NAAIM index shown below was 98 days from the low on August 14, 2024. This is similar to what occurred between points 4 and 1 hitting September 28, 2022 and January 11, 2023. This duration provided a total of 105 days. There is still room to move upward going into December 2024.

Disclaimer

 

It appears Market Makers are in the process of accumulating big tech using various chart patterns. On November 16, 2024 it was noted that two extremely large Apple block trades crossed the tape in October and November 2024. Microsoft had two extremely large blocks cross the tape on August 30, 2024 and November 18, 2024 using a symmetrical triangle. NVIDIA also had two extremely large blocks crossing the tape on September 27, 2024 and November 18, 2024 using an ascending triangle. These trading patterns are consistent with an expected rise in the markets.

Note that this information is for educational purposes only and not a recommendation.

Dow charts courtesy of StockCharts.com.

Disclaimer

On November 11, 2024 it was noted that “behind the scenes Market Makers have been trading very large blocks within key points of typical chart patterns.” Two extremely large Apple block trades crossed the tape recently on October 30, 2024 and November 15, 2024. This occurred near the end of an ascending triangle. It is also similar to what occurred on April 11, 2024 and April 19, 2024 within a falling wedge.

Note that this information is for educational purposes only and not a recommendation.

Chart courtesy of StockCharts.com.

Disclaimer

As of November 13, 2024 points 1, 2, and 3 indicate markets are expected to move higher. The NAAIM Index  aligns with expectations of a year-end rally, as noted on November 13, 2024.

Disclaimer

Behind the scenes Market Makers have been trading very large blocks within key points of typical chart patterns. One series of large Apple block trades appeared between March and May of 2024 at the bottom of a falling wedge. Another series of trades appeared recently in an ascending triangle between late September and November 2024. Based on their trading patterns in large cap stocks, such as Apple, markets are on track for a move upward going into the end of 2024.
Note that scanning for block trades should be available on most trading platforms.

“Big blocks at the tops and bottoms of all moves become larger and more frequent depending on the duration and precipitousness of the move.”
Richard Ney, Making it in the Market, 1975, page 89

Note that this information is for educational purposes only and not a recommendation.

Dow charts courtesy of StockCharts.com.

Disclaimer

As of November 6, 2024 NAAIM Index point 3 on the following chart aligns with October 19, 2022 and October 18, 2023. This supports the expectation of a year-end rally, as noted on November 6, 2024.

Disclaimer

On October 27, 2024 it was noted that a quick move to the upside should occur in November and December 2024. This year-end rally would complete the 4^th quarter peak discussed on October 20, 2024 before moving lower.

Note that this information is for educational purposes only and not a recommendation.

Chart courtesy of StockCharts.com.

Disclaimer

 

 

On October 20, 2024 it was noted that a 4^th quarter peak was expected before stock markets moved lower. To support this, Exchange Insiders setup Intel’s replacement with NVIDIA in the Dow.

History shows Intel’s inclusion in the Dow on November 1, 1999 provided Market Makers with an ability to move other stocks lower in 2000, while Intel moved higher. Declining stocks included Caterpillar, Johnson & Johnson, McDonald’s, Nike, and Proctor & Gamble. Market Makers were able to convince investors to stay in the market during 2000 as the Dow moved sideways. Overall, this process is a merchandising operation. Market Makers will need to move other stock prices lower in 2025 in order to buy additional inventory for the future.

The 40.9 degree angle shown below on NVIDIA’s chart is the same as Intel’s angle during 1999 – 2000. Do not conclude that NVIDIA will move significantly higher. Market Makers will only move NVIDIA as needed in order to lower other stock prices.

“By scrapping traditional theory it becomes possible to discover the true order of things, to show how the aspiration of investors can be linked to the aspirations of the specialist as he proceeds to merchandise his stock.”
Richard Ney, Wall Street Gang, 1974, page 88

Note that this information is for educational purposes only and not a recommendation.

Charts courtesy of StockCharts.com.

Disclaimer

 

The Buffett Indicator is a ratio of the total United States Stock market to GDP. As of August 31, 2024 the Market Valuation to GDP was 209%, and is in the +2.2 standard deviation range. Similar events have occurred in the past where this indicator was near or above the +2 standard deviation level. This includes 1961, 1965, 1968, 1972, 2000 and 2021. Each peak occurred during the 4^th quarter. Once again, the Buffett Indicator is above the +2 standard deviation level. A 4^th quarter peak is expected before stock markets start moving lower.

Note that this information is for educational purposes only and not a recommendation.

Stock charts courtesy of StockCharts.com.

Disclaimer

As of October 16, 2024 points 3, 4, and 5 on the NAAIM Index shown below are aligned within the October time frame. Markets are expected to move lower during the last half of October.

Note that this information is for educational purposes only and not a recommendation.

Disclaimer

On September 26, 2024 it was noted that active money managers were reducing their equity exposure. As of October 9, 2024, it appears they are reluctant to take on additional risk. With an October 9th NAAIM Index reading of 90.26 and Fear & Greed Index reading of 72, there is a low probability of equity managers accumulating a significant amount of risk assets. On October 19, 2022 and November 15, 2023 equity managers did have some room to the upside to accumulate additional risk assets. At this point it will not take much to move the Fear & Greed Index into its Extreme Greed category. To take advantage of this situation, Market Makers may raise equity prices quickly to distribute stock and sell short.

Fear & Greed Index readings relative to the following chart.
Point 1 – October 19, 2022 = 37
Point 2 – November 15, 2023 = 67
Point 3 – October 19, 2024 = 72