Daily Engrbytrade™ Dow calculations indicate a brief mid-November decline will take place before moving higher. This move is expected to be similar to what occurred between May 10, 2021 and May 19, 2021.
Dow: Calculation Update
Based on Congress passing the $1 trillion infrastructure bill and upcoming $1.75 trillion “Build Back Better Plan”, structural calculations indicate the Dow is expected to reach 38,610 (+/- 2.5%) before moving lower.
Dow: $1 Trillion Infrastructure Bill
On November 5, 2021 the House passed a $1 trillion infrastructure bill. This last minute approval provides Wall Street with the means to complete a 1929 peak. Calculations will be revised as needed to incorporate this change.
Disclaimer
Dow: Transports Leading Indicator
On November 2, 2021 the Dow Jones Transportation Average Index hit an all-time high of 18,246.51 with a significant number of large blocks trading during the day. Tuesday’s candlestick formation is typical for a market that is peaking.
Stock chart courtesy of StockCharts.com.
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.
Stock chart courtesy of StockCharts.com
Dow: Turning Down
Daily calculations indicate the Dow is completing its move through the rising wedge discussed on October 25, 2021 and initiating a process to start a decline. This decline is expected to move the Dow back down to 33,613 (+/-1%) using a structure similar to what was developed between June 1, 2021 and June 18, 2021.
Dow: 1989 Nikkei 225
On December 29, 1989 the Nikkei 225 hit a peak of 38,957. Thirteen years later it was below 8,000. It should be noted that the Nikkei 225 parabolic move from 1960 to 1989 looks similar to the Dow parabolic move from 1990 to 2021.
Dow: October Rising Wedge
As noted on October 20, 2021, large block distributions have been observed each day. This is very similar to what occurred between June 21, 2021 and August 16, 2021. This trend upward is expected to be complete by October 28, 2021.
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
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.
Dow: October Decline
Chart courtesy of StockCharts.com
The Dow continues to track with the October 2007 to December 2007 structure. Short term debt ceiling agreements will result in an October decline going into November 2, 2021 (+/- 1 trading day) where the Dow is expected to reach a low of 31121.15 (+/- 1%).
Dow: December 2007
Charts courtesy of StockCharts.com
The current Dow structure is a repeat of October 2007 to December 2007. The next move by market makers will be a reflection of December 27, 2007 to January 22, 2008.
Dow: Algorithm Adjustment
In the October 1, 2021 post, it was noted that the last day of an initial decline was expected on October 13, 2021 (+1/- 1 trading day). Today stock exchange algorithms made an adjustment to the decline timeline where the Dow is now expected to reach a low of 31107.59 (+/- 1%) by October 12, 2021 (+/-1 trading day).
Dow: Initial Decline
The Dow continues to track with the September 23, 2008 to September 30, 2008 structure. An initial decline is expected from October 4, 2021 through October 13, 2021 (+/-1 trading day). This decline has the potential to move the Dow down to 30521 (+/- 1%).
Dow: 2008 vs 2021
Structural and intermarket futures trading data calculations continue to have similar results between the July 15, 2008 to September 22, 2008 Dow structure and the June 18, 2021 to September 28, 2021 Dow structure. This, along with strategic positioning of major currencies discussed in the September 25, 2021 post indicates a significant decline in the Dow is expected during the next 13 trading days (+/- 1 trading day). This decline will have a negative impact on various financial instruments and commodities.
Dow: Entered Target Range
On September 27, 2021 the Dow entered its 1% target range (with a high of 35061.12) as noted on September 20, 2021. There is a 60% chance the Dow will reach 35,359 by October 13, 2021 (+/-1 trading day).
Dow: Daily Gap Filled
The gap between the Dow September 17, 2021 close and September 18, 2021 open was filled today. This confirms a move upward is expected to continue into October 2021, as noted on September 20, 2021.
Dow: Algorithm Update
With the sharp decline today, updates to short term algorithm calculations indicate a move up to 35,359 (+/-1%) by October 13, 2021 (+/- 1 trading day).
Dow: Breaking Down
Charts courtesy of StockCharts.com
To put the Dow’s position in perspective, it has dropped out of the rising wedge that was developed during 2021. Based on short term algorithm calculations the Dow is expected to move back up to the lower trend line before starting a meaningful decline. A leading indicator for the Dow is the Dow Jones Transportation Average. A decline in the Transportation average did start early during 1998 and 2007 prior to the Dow falling. It appears a steady decline in the Transportation average has started with the Dow not far behind
Dow: Extended Duration
Yesterday’s 292 point decline provided an update to short term algorithm calculations that included an extended duration with a move up to a range of 35,698 – 35,785 by October 6, 2021.
Dow: Repeating Algorithms
Monitoring of short term algorithm calculations indicates a move up to a range of 35,698 – 35,785 in the futures market by Sept 20, 2021 (+/- 1 trading day). Essentially a repeat of the structure developed between August 19, 2021 and August 25, 2021.
Dow: Decline Scenarios
Based on futures trading data calculations, exchange insiders are developing two distinct scenarios for a decline.
1. A Dow structure similar to the October – December decline in 2018.
2. A Dow structure similar to the August – October decline in 2008.
As of today, there is a 52% chance the upcoming decline will be similar to the August – October 2008 crash. What is very clear is that the U.S. Dollar will be an important part of this decline. A significant shift from global currencies and stocks into the U.S. Dollar will take place.
Dow: Year End Decline
Intermarket futures trading data calculations indicate plans are progressing for the Dow to peak after September 16, 2021 and start a decline during the last quarter of 2021. This move is expected to be similar to October –December 2018 with the US Dollar moving higher during this period. Upon completion of this decline, the Dow is expected to move on to higher levels following the engrbytrade perspective.
Dow: Moving Higher
The Dow’s 15 minute futures chart structure between August 23, 2021 and August 27, 2021 appears to be giving Wall Street what they want. The right-angled and descending broadening formation will provide a pathway for the Dow to move higher.
Dow: Fed Warning
A warning from Fed President Robert Kaplan indicates a peak in the Dow could come much sooner than expected. Underlying futures trading data calculations indicate positions in the US Dollar are now in alignment with calculations from August 11, 2008 when the Dow hit its peak prior to moving lower.
All that is need now is for the Fed to stop buy bonds and the Bank of England to start raising interest rates.