Category: SP500

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Dow/S&P500/NASDAQ: British Pound and Swiss Franc

On July 20, 2024 an exponential shift occurred when Commercial Futures Traders reported a record level of British Pound net short positions. This short position move was much larger than what occurred in 2007. After the July 2007 record of net short positions, stock markets started moving lower in October 2007.

On July 30, 2024 Non-Commercial Futures Traders reported a record level of British Pound net long positions on July 23, 2024. This was well above the July 2007 record that occurred prior to the Dow and S&P500 peak in October2007.

In the chart below Swiss Franc Non-Commercial Traders repeated a 105 day performance of what occurred between May 29, 2018 and September 11, 2018.  After Swiss Franc traders changed direction in September 2018, stock markets started a decline in October 2018. This lasted until late December 2018.

It appears various currency futures traders are positioning for a stock market peak in late September or early October 2024. This would be followed by a substantial decline going into 2025.

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Interest Rates: July 2007 Trajectory

On July 25, 2024 it was noted that bond traders were preparing for a stock market decline. It also appeared the Federal Reserve was following an interest rate path similar to 2007. The charts below indicate the current 10-Yr Note rate is still on a July 2007 trajectory. The August 2, 2024 10-Yr Note rate decline aligns with the decline on July 26, 2007. This places the current Dow and S&P500 in a position that is similar to  where they were late July 2007.

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

Charts courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: British Pound Net Short Positions

On July 20, 2024 it was noted that an exponential shift occurred when Non-Commercial Futures Traders reported a record level of British Pound net short positions. That record level was broken last week by Commercial and Non-Commercial Futures Traders (Net Long-Short shown below).

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

Chart courtesy of StockCharts.com.

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S&P500: October 2024 Peak

Market Makers and algorithms are consistent with their trading patterns. This can be illustrated in the following charts. An angle of 25.94 degrees provides clarity to their plans for this year with an October 2024 peak that is expected to follow the basic pattern of 2007.  Extremely large block trades indicate Market Makers are also accumulating interest rate derivatives. This includes products such as TLT in preparation for a steady decline of interest rates going into 2025.

Charts courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: Significant Decline in 2025

An exponential shift occurred this week when Commercial Futures Traders reported a record level of British Pound net short positions. This is much larger than what occurred in 2007. It indicates Futures Traders are expecting a repeat performance of 2008 with a significant decline in 2025. As noted on July 19, 2024, a turn upward from the 8.92 degree trend line would lead to a peak in September – October 2024.

Chart courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: Distributing Stock

On July 17, 2024 Market Makers pushed prices higher using their standard practice of distributing stock at the close. It appears they are moving lower using a broadening formation in order to fill one gap created in the extended hours on July 8, 2024 at 4:10 AM. This will provide an opportunity to accumulate additional inventory before moving higher. This is only one example of a coordinated effort using a multitude of trades each day.

Chart courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: Extended Hours Trading

On July 12, 2020 it was observed that very large block trades crossed the tape at an irregular pace. In Extended Hours trading this morning a sharp rise in Intel occurred as Market Makers pushed prices higher. Their accumulation of inventory between April 30th and July 10th was coordinated with the current rise in markets.
This is only educational material. Not financial advice.

Chart courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: Intel Block Trades

Between October 2022 and June 2023 very large Intel block trades crossed the tape approximately every other month. This was followed by a steady move up into the end of 2023 before falling in 2024. Over the last two and one-half months it was observed that very large block trades crossed the tape at an irregular pace.  Typically this would be an accumulation process by Market Makers. But, with the Warren Buffet stock market indicator hitting an all-time high, as it did at the beginning of 2000, it is not clear what Market Maker’s intend to do.

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

Chart courtesy of StockCharts.com.

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S&P500/Dow/NASDAQ: AAPL Block Trade Review

This block trade review found two AAPL trades of more than $1.6 billion occurred on December 3, 2021 and December 15, 2021 before markets started their decline in 2022. Two more AAPL trades of more than $1.7 billion occurred on June 11, 2024 and June 20, 2024. It is an indication that Market Makers are expecting another decline in 2024.

“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.

Charts courtesy of StockCharts.com.

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S&P500/NASDAQ: NVIDIA Short Sale Trade Marker

On June 10, 2024 NVIDIA traded with a price of $195.95. This trade was treated as an anomaly and has been hidden from view by most data suppliers. What should be noted is that it was a short sale trade marker for exchange insiders. It is the inverse of what has occurred many times in the past for companies such as ADP on May 6, 2010 when a low of 17.528 crossed the tape. Since that time ADP moved to a closing price of 235.56 on July 5, 2024.

Note that charts are for research purposes only and not a recommendation.

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Interest Rates: Bond Traders are Preparing

On May 4, 2024 it was noted that a 61.35 degree angle reappeared between June 2022 and October 2023. This is similar to what was developed between February and November 2018 prior to the S&P500 decline in late 2018. It also aligns with what was developed between November 2005 and June 2007 prior to the collapse in 2007. It appears bond traders are preparing for a stock market decline.

Charts courtesy of StockCharts.com.

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S&P500: Time Extension Calculation

On June 20, 2024 a comparison between the S&P500 1961 to 1969 and 2020 to 2024 charts was conducted. This provided a general outline of similarities in the structures relative to price movements. Big block distribution patterns identified on June 26, 2024 provided a base for Fibonacci time extension calculation points. At this point June 27, 2026 is a match for December 6, 1968, as shown in the charts below.

Charts courtesy of StockCharts.com.

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S&P500: Big Block Distribution Pattern

In 2021 a big block distribution pattern was observed between November and the first half of December. This occurred inside of a rising wedge prior to moving lower in 2022. Since March 2024 a significantly larger big block distribution pattern has progressed through a rising wedge shown below. This is an indication that Market Makers are expecting a much larger decline in 2024. Patterns indicate Market Maker inventory is being distributed with seven figure big blocks going to institutions, such as pension funds, corporations (buybacks), large hedge funds, etc.

“It is typical of the specialist’s (Market Maker’s) modus operandi, however, that, regardless of the trend then under way, specialist merchandising strategies will adapt themselves to exploit the profit potentials of bullish or bearish announcements.“
Richard Ney, Wall Street Gang, 1974, page 103

Charts courtesy of StockCharts.com.

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Dow/S&P500: Algorithmic Trading

On June 15, 2024, it was noted that the Dow was moving in a pattern similar to the last half of 2021. A closer look at this pattern shows algorithmic trading continues in a predetermined structure similar to 2021. It also aligns with the S&P500 Fibonacci 1.618 range discussed on June 20, 2024. A move into the 40,200 range is expected before moving lower.

Charts courtesy of StockCharts.com.

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S&P500: Fibonacci 1.618 Range

A review was done on the S&P500 1961 to 1969 and 2020 to 2024 charts based on a brief comparison of their structures. It appears there are general similarities in the structures relative to price movements. What is notable are the Fibonacci structure similarities related to the 1966 and 2022 declines. After the 1966 decline the S&P500 moved up to the 161.8 level in 1968. A similar move appears to be in progress following the 2022 decline. Based on current structures this would result in a move up to the Fibonacci 1.618 range of 5648 before moving lower.

The following is a comparison of data between 1961-1968 and 2020-2024.

1961 – 1968

  1. December 12, 1961 – June 25, 1962 = 29.30% decline
  2. June 25, 1962 – February 9, 1966 = 84.45% rise
  3. February 9, 1966 – October 10, 1966 = 23.69% decline
  4. October 10, 1966 – September 25, 1967 = 36.01% rise
  5. September 25, 1967 – February 13, 1968 = 11.77% decline
  6. February 13, 1968 – December 2, 1968 = 26.10% rise

2020 – 2024

  1. February 19, 2020 – March 23, 2020 = 35.41% decline
  2. March 23, 2020 – January 4, 2022 = 119.84% rise
  3. January 4, 2022 – October 13, 2022 = 27.53% decline
  4. October 13, 2022 – July 27, 2023 = 31.94% rise
  5. July 7, 2023 – October 27, 2023 = 10.92% decline
  6. October 27, 2023 – March 28, 2024 = 28.29% rise

Charts courtesy of StockCharts.com.

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Dow/S&P500: Brief Move Upward

The move on Friday, May 31, 2024 was a culmination of the following factors:

  • 7 figure block trades crossing the tape on 5/29, 5/30/, and 5/31/2024
  • The Fear and Greed Index being in a position similar to where it was on January 19, 2023.
  • No Dow or S&P500 futures gaps in their 5-min charts above the close on 5/31/24
  • One small gap remains in the NASDAQ futures 5-min chart on 5/28/24 above 18,942.

A brief move upward is expected before a decline is initiated.

Stock charts courtesy of StockCharts.com.

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Dow/S&P500: Block Trades

The Dow changed direction three times between March 2024 and May 2024, as shown below. Groups of very large, seven figure block trades were observed during each change in direction. In the sample group of block trades under observation, two large cap tech stocks stood out. Since this sample group was relatively small, there may be other companies that fit this profile. Additional work will be needed to reveal any consistent patterns.

Stock chart courtesy of StockCharts.com.

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Dow: Transportation Index Lag

The Dow Jones Transportation Index typically moves with the Dow Jones and S&P500 indices. There have been periods in the past when the Transportation Index lagged behind other indices, ultimately resulting in a decline of major stock indices. The most recent lag period occurred between October 2019 and January 2020 prior to a significant decline going into March 2020. The charts below currently show a significant Transportation Index lag relative to the Dow Jones and S&P500 indices. A decline is still expected.

Stock charts courtesy of StockCharts.com.

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S&P500/Silver: 1973 Structures

On April 17, 2024, a pull back within silver’s ascending triangle was expected. Silver did pull back into May and then continued to move higher. This move is consistent with the 1971 – 1973 silver structure shown below. As silver started to move higher in 1973, the S&P hit its peak on January 11, 1973 and started a decline the following day.  The current 2024 structures are expected to continue on a path that is similar to the 1973 structures.

Stock charts courtesy of StockCharts.com.

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1971 – 1973

2021 – 2024