Engrbytrade Posts

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S&P500: CNN Fear and Greed

The CNN Fear and Greed Indicator uses seven technical indicators to provide a reading between 0 – 100. Since August 2022 readings at the close have been moving between a low of 14 and high of 85. When the reading briefly drops between 20 and 35, markets would be expected to trend higher. When readings drop below 20, there is a high probability that markets will move higher. There have been four readings below 20 between 2022 and 2025. They are noted in the following chart. If there is a sharp sell off over the next few weeks with a Fear and Greed reading below 20 at the close, then markets would be expected to move higher.

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

Stock charts courtesy of StockCharts.com.

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U.S. Dollar: Major Signals from 2011

There are major signals from 2011 that are repeating today.
They include:
1. A significant accumulation of TLT,
2. Extreme futures trader positions in the Swiss Franc, Canadian Dollar, 10-Yr Note, and
3. The completion of a gold cycle.

In addition to the above signals a silent collapse of Dow stocks is in progress.

Based on the above signals a significant event is coming in the weeks ahead and would be expected to shake the financial system. It may not have an immediate impact on stock markets, but the flight to safety will be obvious. Interest rates will decline. A short quick decline in the stock market could occur, but affected stocks will drop dramatically as the year progresses. This also means the U.S. Dollar will start a long term trend to move higher over the next several years. Gold will immediately hit a peak and then start a long term decline as the Dollar moves higher.

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

Stock charts courtesy of StockCharts.com.

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US Dollar/Dow/S&P500: Move to Swiss Francs

The following charts indicate Swiss Franc Non-Commercial Traders are near the end of a short selling cycle. Based on Commercial Trader positions, countries repatriating gold, tariffs, etc., banks, sovereign wealth funds, hedge funds, and global corporations expect stock market and currency volatility in 2025 and 2026. They will move to Swiss Francs, among other stable assets, for safety just as they did in 2019 and 2020.

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

Currency chart courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: British Pound Connection

On July 23, 2024 British Pound Non-Commercial Futures Trader positions hit a record level. This British Pound connection has an intermarket relationship with U.S. stock markets. On July 17, 2007 British Pound Non-Commercial Trader positions peaked, as shown below. This was followed by a decline in the British Pound and U.S. stock markets in 2008. The British Pound just moved into a position that is similar to where it was in March 2008. Futures trader positions indicate a significant amount of capital is moving in preparation for a major stock market decline in 2025.

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: Decrease In Volume

During the first seven trading days of February 2025 there has been a noticeable decrease in the number of six and seven figure block trades within the Dow. This includes AXP, BA, CAT, GS, HD, HON, MCD, MMM, SHW, TRV, and UNH. This decrease in volume can also be observed in the following chart as the S&P500 moves through a rising wedge. Either someone cut off a funding source(s) or Market Makers are waiting for something.

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

Stock chart courtesy of StockCharts.com.

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Gold/Dollar: Deflationary Forces

On October 12, 2024 three Non-Commercial gold futures trading points (1, 2, and 3) were identified in the following chart. What followed was a deflationary period where gold declined and the U.S. Dollar moved higher between 2011 and 2015.

Non-Commercial gold futures trader positions are currently in the process of completing a 2016 to 2024 three point trading sequence (Points 4, 5 and 6). What is expected to follow over the next four years are lower gold prices and an increasing value of the Dollar. This will be due to deflationary forces, which are not yet visible. It is expected to occur between 2025 and 2029. This also aligns with what was discussed on November 23, 2024.

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

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Dow/S&P500/NASDAQ: Walmart Going Parabolic

A previous post on February 3, 2025 noted that a global financial crisis is on the way. A closer look at Dow stocks on an arithmetic scale shows that it can be interesting to watch companies such as Walmart going parabolic. Walmart may stall, as it did in 2000 and move sideways for several years. But after Walmart hit its peak in 2000, the “tech bubble” popped and brought about losses that are still discussed today. There are numerous headlines about reducing the debt, Warren Buffett and Jeff Bezos selling stock, jobs, inflation, etc., etc. What is important are the positions that Market Makers are taking to setup for a decline. Since they run a “merchandising operation”, sales to pension funds, hedge funds, and large institutions would be in order at this point. In January 2025 there was a significant increase in the number of extremely large blocks of stock crossing the tape. As this occurred, active investment managers increased their exposure between the end of January and beginning of February.

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/NASDAQ: Global Financial Crisis

On December 19, 2024 it was noted that over the last several years Market Makers have been working on a parabolic structure for IBM. The following IBM charts include Engrbytrade™ markers within the structures. Connecting markers between 2010 and 2025 shows a projected low in the $60 to $70 range by mid- 2026. This aligns with the following S&P500 chart showing a projected low in 2026. A similar collapse occurred with Intel between April 2021 and February 2025. Markers still indicate Intel could drop below $10.

The following charts are also an indication that a global financial crisis is on the way. In 1987, Donald Bernhardt and Marshall Eckblad, from the Federal Reserve Bank of Chicago issued the “Stock Market Crash of 1987” essay. They included the following point. “….a new product from US investment firms, known as “portfolio insurance,” had become very popular. It included extensive use of options and derivatives and accelerated the crash’s pace as initial losses led to further rounds of selling.”

Today the growth of derivatives continues toward estimated values as high as $2.3 quadrillion. New speculative products such as Zero-Day options, Bitcoin ETFs, etc. are just a repeat of what led up to the 1987 crash.

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

Stock charts courtesy of StockCharts.com.

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Crude Oil: Decline in 2025

The CME Heating Oil Product “NY Harbor Ultra-Low Sulfur No. 2 Diesel” provides some insight to the direction of global crude oil prices. Over the next several months a second peak in Commercial Trader positions is expected. This will lead to oil prices moving significantly lower. Note that  previous peaks led to a decline in 2014 – 2015 and 2020. As a result of current positioning, the Dow stock, Chevron is expected to have a substantial decline in 2025. It is possible this decline could run into 2026.

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/NASDAQ: NAAIM Index – January 29, 2025

Based on extremely large block trades crossing the tape over the last four weeks, it appears capital has been moving out of stocks. This aligns with what occurred in August 2022 and August 2023 when active managers were reducing their risk exposure. In order for a sustainable rally to continue the index would first need to drop below the lower trend line with a reading of 60 or below. This would provide Market Makers with an opportunity to accumulate additional inventory before moving prices higher.

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

Source: National Association of Active Investment Managers

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Dow: 2025 Algorithms

On November 9, 2024 it appeared that Market Makers were using algorithms to reproduce mathematical relationships used in the 2018 Dow chart structure. The first chart shown below is an extension of the January – November 2024 chart. It shows 2025 algorithms are definitely continuing to build out a replica of the 2019 – 2020 Dow structure. It appears a decline is near.

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/NASDAQ: Wait and see situation

The Dow and S&P500 chart structures between October 7, 2024 and January 23, 2025 are similar to the Dow and S&P500 chart structures between July 29, 1929 and October 11, 1929. Current conditions noted on January 21, 2025 showed a repeat of the October and November 2023 chart structure with the potential of moving higher in 2025. This could change quickly depending on what the Fed does with interest rates on January 29, 2025. It is a wait and see situation with the Fed.

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

Stock chart courtesy of StockCharts.com.

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Canadian Dollar: Dow Stocks Moved Higher

A significant reaction with other currencies did not occur after July 30, 2024 as Non-Commercial futures traders held a substantial number of short positions in the Canadian Dollar. Additional research shows a move upward in large cap stocks started on January 9, 2007, and May 30, 2017. Since Canadian Dollar short positions hit a peak on July 30, 2024 several Dow stocks moved higher during the last half of 2024. At this point the Dow is still expected to move higher, as noted on January 21, 2025.

Peak short position dates:
Stocks moved higher in 2007, 2017 and 2024
1/9/07 – appl, amzn, intc, ko, mcd, nke, nvda, pg
5/30/17 – appl, amgn, ba, cat, crm, csco, hon, intc, jnj, mcd, mmm, nvda,unh, wmt
7/30/24 -aapl, amzn, axp, cat, crm, csco, dis, gs, hd, hon, ibm, jpm, mcd, mmm, v, wmt

In order to provide a better perspective on futures traders actions the following question was submitted to Grok on X.

Grok: Why are the majority of non commercial futures traders holding short positions on the Canadian dollar?

Non-commercial futures traders, often referred to as speculators, have been noted to hold substantial short positions on the Canadian Dollar (CAD) as of recent market analyses. Several factors contribute to this trend:

  1. Economic Policy Concerns: There’s a sentiment, reflected in posts on X, that current Canadian economic policies, including changes in capital gains tax, might be viewed unfavorably by investors. This has led to a lack of confidence in the Canadian economic environment, prompting these traders to bet against the CAD.
  2. Interest Rate Differentials: The Bank of Canada’s decision to cut interest rates earlier than other G7 countries could be influencing the CAD’s value. Lower interest rates typically lead to a weaker currency as they reduce the return on investments denominated in that currency. The anticipation of further rate cuts could be driving more traders to short the CAD.
  3. Global Commodity Prices: Canada’s economy is heavily influenced by commodity prices due to its significant exports in natural resources. If speculators anticipate a downturn in commodities like oil, lumber, or minerals, they might increase their short positions on the CAD, expecting it to depreciate with falling commodity prices.
  4. Market Sentiment and Positioning: Data from the Commitments of Traders (COT) report by the CFTC shows a significant net short position by non-commercial traders, which is at historical highs. This could be a reflection of broader market sentiment or a reaction to technical trading signals that suggest a bearish outlook for the CAD.
  5. Hedging Strategies: While non-commercial traders are primarily speculators, their actions can also reflect broader hedging strategies against perceived risks in the Canadian market, especially if they see potential for the currency to weaken further due to domestic or international economic factors.

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

Stock chart courtesy of StockCharts.com.

Disclaimer

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Dow/S&P500: Repeat of October and November 2023

Today the CNN Fear & Greed Index hit a reading of 41 at the market close. The range of CNN index readings between December 19, 2024 and January 21, 2025 are similar to what occurred between October 5, 2023 and November 3, 2023. This sequence of index readings prompted a review of extremely large block trades in the Dow during each time frame. Based on the results of a Dow 30 big block review, it appears we are seeing a repeat of October and November 2023 where the markets are expected to move higher.

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

Stock chart courtesy of StockCharts.com.

Disclaimer

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Dow/S&P500/NASDAQ: Apple Repeat of 2012

Apple has declined 11.2% since December 26, 2024. As Apple continues to decline, the press will provide various excuses to retail investors. The press will never mention anything about Market Makers selling (distributing) big blocks of stock to institutions. Reviewing the 2024 – 2025 chart below, a continuous move upward would have been expected using an ascending triangle. There was some 2024 year-end big block selling. But, since then extremely large (7 figure) block trading activity started to increase as the stock dropped below its ascending triangle.
The current Apple chart structure and ascending triangle is a repeat of 2012, as shown in the second chart. Since Apple is 14th in the Dow’s weight ranking list, a decline should not have a dramatic impact on the index. With a mid-ranking weight Dow stock, a slow but steady decline, and the media continuously saying markets will move higher, retail investors are expected to end up with a loss.

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/NASDAQ: Silent Collapse

On December 28, 2024 it was noted that the last quarter of 2024 was expected to be a market peak period. This was based on the Wilshire 5000 to GDP Ratio hitting 203.69%. In addition to this the Dow continues to move higher while a silent collapse is in progress. The 2020 – 2025 list of stocks shown below have had significant declines from their highs as early as 2020. This is very similar to what occurred when the Dow moved sideways as stocks started a silent collapse between 2000 and 2001. By 2004 fourteen stocks in the Dow 30 had experienced a significant decline. This process started again in 2020 and will continue through 2025. Note that the 2020 – 2025 chart structure will not be similar to that of 2000 – 2004, but Market Maker techniques for a silent collapse will be.

“Like the musicians in an orchestra, the specialists (Market Makers) who conduct the movements of each of the Dow stocks work on behalf of their own interests while at the same time working for the fulfillment of the objectives of the system as a whole.”
Richard Ney Making it in the Market, 1975, page 98

The Silent Collapse Lists

2020 – 2025

BA – 2020 – 2025
DIS – 2021 – 2025
MMM – 2021 – 2025
INTC – 2021 – 2025
NKE – 2021 – 2025
VZ – 2021 – 2025

2000 – 2004

AAPL – 2000
AMZN – 2000
AXP – 2000 -2001
BA – 2001- 2003
CSCO – 2000 – 2001
DIS – 2000 – 2002
HD – 2000 – 2003
HON – 1999 – 2002
INTC – 2000 – 2002
JPM – 2000 – 2002
MCD – 2000 – 2003
MRK – 2001 – 2004
MSFT – 2000
PG – 2000

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

Stock charts courtesy of StockCharts.com.

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Interest Rates: Extreme Range

The 10-Yr Note Non-Commercial Trader net position continues to remain in an extreme range away from the mean. It is in a relative position that is similar to where it was on November 20, 2018. The current trader net position is also 46% larger than it was on November 20, 2018. Dow intermarket relationship calculations with the 10-Yr Note continue to align with Market Maker distributions of extremely large blocks of stock.

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

Stock chart courtesy of StockCharts.com.

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Dow: 1973 and 2025

Regardless of trends in the economy, politics, or world events Market Makers will use tools at their disposal to create market structures to fill their needs. In the 1970’s it was the information age with the internet and personal computers. Today it is AI. The 1973 and 2025 charts shown below are strikingly similar. This is a well coordinated effort with the media to keep investors interested in the markets. There is an extremely high probability that the end result will be similar to what occurred in 1973 and 1974.

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

Stock charts courtesy of StockCharts.com.

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Interest Rates: TLT Accumulation Process

In September 2023 it appeared Market Makers started accumulating TLT. This accumulation is similar to what was accomplished between May 2010 and March 2011. The following charts show a 12.34 degree trend line supporting their accumulation process. After their accumulation was completed in 2011, the Fed sent a message announcing a plan to peg interest rates at ultra-low levels. This was meant to boost growth in the economy.

It appears they are currently planning to follow the same accumulation process using a 12.34 degree trend line. On January 6, 2025 Fed official Lisa Cook delivered a blunt message to the stock market noting that valuations are elevated.. Using this signal from the Fed, Market Makers can now work on wrapping up their accumulation effort. Over the last month extremely large blocks have continued to cross the tape. Market Makers will be finished long before the Fed announces any actions to lower interest rates.

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 [Market Makers] 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.

Stock charts courtesy of StockCharts.com.

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Dow/S&P500/NASDAQ: British Pound Trader Positions

On July 23, 2024 a record level of Non-Commercial Futures Traders Net (Long-Short) positions was recorded for the British Pound. This is well above the previous record set on July 17, 2007. After the July 2007 futures positions peak there was a delay of approximately three and one half months before the Dow, S&P500, and NASDAQ started a decline. The 10-Yr Note yield was also in decline during this time. With a significantly larger number of futures trader positions recorded on July 23, 2024, a longer delay for a decline in the stock markets is anticipated. It has been five and one half months since the peak on July 23, 2024. The 10-Yr Note yield is currently in decline, as it was in 2007. A decline in the stock markets is still expected as capital from around the world continues to move into U.S. Dollars.

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

Stock and currency charts courtesy of StockCharts.com.

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