Category: SP500

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Dow/S&P500/NASDAQ: Significant Decline Update

On July 20, 2024 Engrbytrade™ intermarket futures trading data calculations identified a series of key Commercial Trader British Pound positions in 2023 and 2024. This indicated the Dow, S&P500, and NASDAQ would repeat their performance of 2008. Currently the British Pound is repeating a peak that was formed in late October and early November 2007. Based on this data, stock markets are expected to have a significant decline in 2025.

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: Fibonacci Expectations

On September 13, 2024 it was noted that the S&P500 candlestick on September 11, 2024 was similar to the January 24, 2022 candlestick. A review of the following 1-hour charts provided additional Fibonacci expectations that 2024 would be very similar to 2022. The Dow is currently expected to move up to the 1.68 level before moving lower.

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

Charts courtesy of StockCharts.com.

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S&P500: Candlestick Characteristics

Engrbytrade™ Daily Trade Pattern Structure Calculations show the candlestick on September 11, 2024 has similar candlestick characteristics as the one on January 24, 2022. A brief move to the upside is expected for computers and Market Makers to distribute their inventory to retail investors.

 

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

Charts courtesy of StockCharts.com.

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S&P500: Utilities Industry Group

Between July 31st and August 1st 2024 the S&P500 Utilities Sector Bullish Percent Index moved up to 96.67. There was a brief decline during the beginning of August. Then it moved up to 96.67 again between August 14, 2024 and September 3, 2024.

Previously, the Utilities Sector Bullish Index moved up to 96.55 during August and September 2022. This was followed by a sharp decline in the Utilities Industry Group Index

The current bullish reading of 96.67 indicates the Utilities Industry Group Index is overvalued.

 

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: The Markets Are Rigged

Yes, The Markets Are Rigged

In 2008 the NYSE transitioned from Specialists to Designated Market Makers and Supplemental Liquidity Providers. It is still a merchandising operation.

Approved NYSE Supplemental Liquidity Providing (SLP-PROP) Firms
HRT Financial LLC
IMC Chicago LLC
Latour Trading, LLC
Tradebot Systems, Inc.
Virtu Americas LLC

Approved NYSE Designated Market Makers
Citadel Securities LLC
Goldman, Sachs & Company
Virtu Americas LLC

 

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Dow/S&P500: Hindenburg Omen Index

Research into the weekly Hindenburg Omen Index revealed comparable points to the weekly 10-Yr Note Non-Commercial Futures Trader Net chart. In 2018 the weekly omen index hit 3.0 on September 4th, 10th, and 17th. On September 25, 2018 Non-Commercial Futures trader positions hit a low in the 10-Yr Note, as shown on the chart below. On October 4, 2018 the Dow and S&P500 started a decline that continued to the end of December 2018.

In comparison to 2018, the index recently hit 3.00 on September 3rd and 9th. At this point 10-Yr Note Futures traders are aligned closely with the weekly Hindenburg Omen Index. If the index hits 3.0 again, there is a high probability of a decline going into the end of 2024.

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

Index chart courtesy of StockCharts.com.

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Dow/S&P500: Gap Open for 32 Days

On September 5, 2024 it was noted that futures gaps were still left to fill for the Dow and S&P500. Each index still has a one gap that has been open for 32 days, which is quite unusual.  Investing.com can provide charts for Dow and S&P500 futures, if you are interested. Use a 5-minute chart with candlesticks to view the gaps.

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

Charts courtesy of StockCharts.com.

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S&P500: Patterns Emerge

On September 3, 2024 a net reportable positions of S&P500 clearing members, futures commission merchants, and foreign brokers chart was developed. A review of relatively small variances provided a high correlation of key turning points where patterns emerge. Based on this data five out of six dates above the red line were starting points for an ascending broadening wedge. The most recent move was an ascending broadening wedge formed between December 5, 2023 and September 3, 2024. This is similar to what occurred between June 1, 2021 and February 11, 2022.

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

Stock charts courtesy of StockCharts.com.

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Dow/S&P500: August to October 2023 Patterns

The latest NAAIM update indicates the Dow 8 point chart shown below is complete.  At this point the Dow and S&P500 are expected to follow their August to October 2023 patterns. This move would also line up with computer algorithms working to fill remaining futures gaps created in August 2024.

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

Stock charts courtesy of StockCharts.com.

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Dow/S&P500: Unfinished Business

It appears that computer algorithms are working on some unfinished business related to filling futures gaps. On August 27, 2024 it was noted that there were still two open futures gaps to fill. The S&P500 is very close to filling its first futures gap created on August 15, 2024. It has been open for 21 days.

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: NAAIM Weekly Exposure Index

A review of the August 30, 2024 NAAIM Weekly Exposure Index revealed a repetitive pattern along a 17.33 degree trend line. The Dow continues to move higher and is expected to briefly touch its 16.83 degree upper trend line. This will complete the 2021 chart structure guide discussed on August 22, 2024.

Market Maker big block distributions after August 5, 2024 have been relatively light and are focused on a few big tech stocks and ETFs such as the SPY. This indicates Market Makers are planning to accumulate additional inventory during the next decline.

Overall, there are very few sector bullish percentage indices that are overvalued. Examples include the S&P Health Care Sector and S&P Real Estate Sector.

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: 1987 Trend Line Update

On August 24, 2024 it was noted that contact with the IBM 1987 upper trend line was expected in late August or early September. On August 28, 2024 IBM hit its 1987 37.18 degree trend line shown below. IBM is expected to continue following its 1987 chart structure.  When IBM hit its peak on August 21, 1987 it started a decline that ended on October 19, 1987. If a large number of stocks collapse in October, markets will close just as they did in 1987 and brokers will not respond.

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

Chart courtesy of StockCharts.com.

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Dow/S&P500: August Futures Gaps to Fill

Market Makers continue to proceed to the 16.83 degree upper trend line discussed on August 26, 2024, At this point there are still two open futures gaps.  On August 8, 2024 and August 15, 2024 gaps were created in the Dow and S&P500 futures 5- minute charts. The majority of gaps created in these futures have a high probability of filling within a 5 day window. A sampling of 22 gaps in the Dow futures 5-minute chart between January 17, 2024 and August 4, 2024 were identified. Out of this sample 15 filled in less than 5 days. Five filled between 5 and 15 days, and 2 filled after 15 days. The Dow gaps noted above have been open 19 days and 12 days, respectively. Based on historical data, this indicates both gaps should fill before the September options expiration date.

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: IBM 1987 Trend Line

On April 27, 2024 it was noted that structural calculations for the 2017 to 2024 IBM chart were similar to that of 1986 – 1987. On August 1, 2024 a review indicated IBM was still on track to reach its 37.18 degree upper trend line. The following charts show contact in late August or early September would be expected for the IBM 1987 trend line.

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: Very brief pullback

On August 5, 2024 the Dow and S&P500 hit their lows of 38499.27 and 5119.26, respectively. Market Makers used this decline as an opportunity to accumulate additional stock (inventory). Based on the accelerated move from August 5, 2024 to August 16, 2024 a pullback is expected over the next several trading days, before moving higher. Trading patterns during the week of August 19, 2024 are also expected to be similar to the following.

  • October 5, 2022 to October 13, 2022
  • October 17, 2023 to October 27, 2023

In addition to this, sentiment calculations show a very brief pullback is expected before moving higher.

Charts are courtesy of StockCharts.com.

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Dow/S&P500/Interest Rates: Mid-August 2007

On May 4, 2024 it was noted that Futures Traders were still waiting for a decline in rates and that it would be generated by the bond market, not the Fed. Since then, the 10Yr Note rate has dropped from 4.52 to 3.88 without a Fed rate cut. Futures trading data continues to confirm the 10Y Note rate is expected to decline. The mid-August 2007 and 2024 10-Yr Note rate structure positioning is in alignment, along with the Dow and S&P500.

Stock charts are courtesy of StockCharts.com.

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Dow/S&P500: Repeat of 2020

A brief pullback in the market is expected to be similar to what occurred between October 5, 202 to October 12, 2022 or October 18, 2023 to October 27, 2023. This could also turn into something much larger. On August 14, 2024 the WHO declared mpox as a public health emergency of international concern. If this situation continues to grow it could turn into a repeat of 2020.

Charts are courtesy of StockCharts.com.

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Dow/SP500: Market Maker Accumulation

The Market Maker accumulation process was in full swing on August 5, 2024. For example, it appears they accumulated at least 5 times the number of shares in the SPY that they normally would on an average day. This inventory will be redistributed as the markets move higher. In the background, CNN’s Fear and Greed Index hit 18 with an intraday low of 16. In comparison this index closed with a low of 17 on October 11, 2022. The Dow is still on track with the 2021 eight point chart shown below.

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

Charts are courtesy of StockCharts.com.

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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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