Engrbytrade Posts

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NASDAQ 100: December 2021 vs November 2023

It has been observed that structural changes in the NASDAQ 100 between November 10, 2021 and December 27, 2021 have similar characteristics to what occurred over a longer time frame in the NASDAQ 100 between July 10, 2023 and November 10, 2023. Underlying data indicates significant short selling occurred in the first half of November 2023, just as it did during the last half of December 2021. Technical indicators such as the CCI, Chalkin oscillator, and 15 day Stochastic are also in alignment between December 2021 and November 2023.

On November 4, 2023 it was noted that on October 31, 2023 the VIX was in a position similar to where it was on October 30, 2018 and markets would move higher until November 8, 2023. As of November 10, 2023 the VIX continues to move lower with a close of 14.17. Stock markets are expected to move sideways during the week of November 13, 2023 while Congress struggles with the passage of a Government funding bill before November 17, 2023. Additional data will be needed to confirm markets move lower, just as they in in January 2022.

Stock charts courtesy of StockCharts.com.

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S&P500/Dow/NASDAQ: Eight Point Decline Structure

The S&P500, Dow and NASDAQ are all using an eight point decline structure in their daily charts. This structure is typically found within a shorter duration, such as 1-hour futures charts, and was categorized as an Engrbytrade Eight Point Trading ModelTM.  Based on Engrbytrade™ VIX futures trading data calculations noted on November 4, 2023 and eight point trading model structure development, this decline is expected to continue with the potential for completion in the first quarter of 2024.

Stock charts courtesy of StockCharts.com.

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NASDAQ: VIX vs. NASDAQ

On November 4, 2023 it was noted that on October 31, 2023 the VIX was in a position similar to where it was on October 30, 2018 with a stock market rally expected to continue until November 8, 2023 (+/- 1 trading day) before stock markets started moving lower. The following NASDAQ 100 charts provide a comparison to the position of the VIX. Based on Engrbytrade™ futures trading data calculations the NASDAQ is expected to move lower for the remainder of 2023.

Stock charts courtesy of StockCharts.com.

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VIX: October 30, 2018 vs October 31, 2023

Engrbytrade™ futures trading data calculations show that on October 31, 2023 the VIX was in a position similar to where it was on October 30, 2018. This indicates stock markets will continue to move higher, as they did between October 30, 2018 and November 8, 2018, with an eight day trading rally. Based on this comparison, a brief rally is expected to continue until November 8, 2023 (+/- 1 trading day) before stock markets start to move lower.

Stock charts courtesy of StockCharts.com.

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Interest Rates/Dow: 10-Yr Double Top

On October 10, 2023 it was noted that the 10-Yr note charts shown below carry similar underlying characteristics based on Non-Commercial futures trader’s positions. Structural similarities of the 2018 and 2022-2023 charts indicates a double top in the 10-Yr note is expected when the Dow moves up to 35,078 +/- 1%, as discussed on October 26, 2023, prior to moving lower.

Stock charts courtesy of StockCharts.com.

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Dow: 2021 vs 2023 Structure Perspective

Daily engrbytrade™ structural calculation results have shown the Dow’s decline from July 21, 2023 to October 6, 2023 is similar to what occurred between October 26, 2021 and December 1, 2021. To put this in perspective, the move down from July to October 2023 is part of a long term process for moving the Dow to lower levels. The Dow is currently in a process of repeating a move similar to what occurred between December 2, 2021 to January 5, 2022 in order to fill the Dow futures gap created on August 1, 2023 at 6:00 p.m. and S&P500 futures gap created on August 2, 2023 at 9:30 a.m. This will also provide Market Makers with the means to distribute their inventory before moving markets lower.

Note: The Dow structure developed in the last quarter of 2023 is not expected to be an exact replica of December 2021.

Stock charts courtesy of StockCharts.com.

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July 21, 2023 – October 6, 2023

October 26, 2021 – December 1, 2021

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Dow/S&P500: Sharp Rally Expected

Stock Markets have a history of moving higher within 5 trading days of Congress adopting a resolution for war powers. By November 1, 2023 a sharp rise in the stock market is expected to start.

Congress adopts resolution to support Israel

Biden sends War Powers notification to Congress following strikes in Iraq and Syria

Here are previous examples of Congress adopting a resolution for war or military force. All were followed by a stock market rally.

Oct 2, 2002
Congress adopts resolution for Iraq war

Jan 12, 1991
Congress approves use of Military Force against Iraq Resolution of 1991

Aug 25, 1982
Congress invoked War Powers Resolution for Lebanon

Stock charts courtesy of StockCharts.com.

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S&P500: October 2002, 2022 and 2023

A closer look at the timing of Congressional military support resolutions, daily fear and greed readings, and block trading patterns revealed the following observations.

  • S&P500 chart structure Fibonacci measurements for the move down in October 2023 are similar to what was developed in October 2002.
  • CNN Fear and Greed Index readings between October 3, 2023 and October 27, 2023 are similar to what occurred between September 29, 2022 and October 11, 2022.
  • Very large block trade patterns between September 21, 2023 and October 27, 2023 are similar to trade patterns between September 19, 2022 and October 10, 2022.

Stock charts courtesy of StockCharts.com.

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S&P500: Defense Spending

As the Middle East conflict escalates Congress adopted a resolution on October 25, 2023 for increased military defense spending. This is similar to when Congress said yes to the Iraq resolution, as reported on October 3, 2002. After adopting the October 3, 2002 resolution, stock markets started moving higher going into the end of 2002. A similar move upward is expected during the last quarter of 2023. This is based on the adopted October 25, 2023 resolution and very large block trades that continue to cross the tape.

Stock charts courtesy of StockCharts.com.

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Dow: September – October 2022

On October 19, 2023 it was noted that the Dow structure was in a similar position to where it was on March 22, 2023. Additional research revealed the September 1, 2023 to October 26, 2023 Dow structure is very similar to its structure that was developed between September 1, 2023 and October 12, 2022. Large block trades are also in a pattern that is similar to what occurred between September 26, 2022 and October 12, 2022. A move up to 35,078 +/- 1% is still expected.

Stock charts courtesy of StockCharts.com.

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Gold: Futures Trading Data

The current 2020-2023 gold chart structure shown below is what would typically be called a triple top formation. This by itself does not necessarily confirm that a decline is expected. The underlying futures trading data behind this structure is important. In September 2021 and October 2023 Engrbytrade™ futures trading data calculations show that traders have been positioning their trades with the expectation of a long term decline. Similar moves occurred in 2012, and 1994-1995 as identified by arrows in the charts below.

Stock charts courtesy of StockCharts.com.

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Dow/S&P500: March 2023 vs October 2023

A review of large block trading patterns, comparable fear and greed index readings and engrbytrade™ futures trading data calculations indicates the current Dow and S&P500 chart structures are in a similar position to where they were on March 22, 2023. This update indicates a move up to 35,078 +/- 1% on the Dow and 4522 +/-1% on the S&P500 are expected.

Stock charts courtesy of StockCharts.com.

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Dow: Market Decline Structure Setup Update

On October 12, 2023, it was noted that a decline structure setup going into the last quarter of 2023 is similar to what occurred in 2018. A detailed review of the 1973 vs 2023 19 point chart posted on September 29, 2023 against the charts shown below revealed that Market Makers shifted away from the 1973 model to a 2018 chart structure starting in mid-March 2023, just  prior to the start of interest rates moving higher in the 2nd quarter of 2023. A move up to 34,598 +/- 1% by October 18, 2023 is expected before starting a sharp decline.

Stock charts courtesy of StockCharts.com.

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Dow: Market Decline Structure Setup

On October 10, 2023 it was noted that the 2018 and 2023 10-Yr interest rate charts had similar underlying characteristics based on 10-Yr Non-Commercial futures trader’s positions. The following 2023 Dow chart also illustrates a decline structure setup going into the last quarter of 2023 that is similar to what occurred in 2018.

Stock charts courtesy of StockCharts.com.

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Interest Rates/S&P500: Stock Market Decline Setup

On October 5, 2018 the 10-Yr note interest rate closed within range of the 127.20% Fibonacci value in the first chart structure shown below before turning and starting a decline. On October 5, 2023 the 10-Yr note interest rate closed above the 127.20% Fibonacci value in the second chart structure shown below. The two charts carry a similar underlying characteristic based on 10-Yr Non-Commercial futures trader’s positions shown in the third chart below. This type of interest rate positioning by futures traders indicates a quick move down (minimum of 5%) in the S&P500 is expected.

Similar readings were received in the 10-Yr Non-Commercial futures trader’s positions on June 29, 2004 and April 13, 2010. After June 29, 2004 the S&P500 dropped 6.2%. After April 13, 2010 the S&P500 moved sideways until May 4, 2010 when a “flash crash” occurred leading to a 5.6% decline in May 2010.

As of October 7, 2023, the S&P500 started a quick consolidation phase prior to moving higher. This could change quickly with a sharp decline, which appears to be what is expected by bond traders. Additional trading data will be needed to determine a change of direction.

Stock charts courtesy of StockCharts.com.

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Dow/S&P500: Consolidation Before Moving Higher

There is a 30% chance the Dow will decline to 32,873 along with the S&P500 dropping to 4216 for a consolidation before markets move higher. Daily Engrbytrade™ E-Mini Dow futures calculations, along with standard technical indicators such as the NYSE Market Thrust, CBOE Put/Call Ratio, and CBOE Options Equity Put/Call Ratio indicate a move up is still expected.

Stock charts courtesy of StockCharts.com.

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S&P500: Falling Wedge Pattern

The following one hour charts illustrate how a falling wedge pattern aligns with the Fear & Greed Index. On March 13, 2023 the index hit 20. At the close of October 3, 2023 the index was 17. In addition to this index, it was observed that there was a substantial increase in the size of larger block trades between September 21, 2023 and September 29, 2023 as compared to March 10, 2023 through March 16, 2023.

Stock charts courtesy of StockCharts.com.

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S&P500: Markets Readjust

On September 26, 2023 it was noted that the S&P500 was expected to move down to the lower trend line of its accumulation channel shown below. Between September 21 and September 29, 2023 extremely large block trades were observed crossing the tape. Today the S&P500 pierced its lower trend line while the Fear & Greed Index dropped below 20 during the first half of the trading day. Market Makers should continue accumulating additional inventory as markets readjust for another move upward.

Stock chart courtesy of StockCharts.com.

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Dow: 1973 vs 2023 19 Point Chart

The Dow is currently expected to move higher based on changes in U.S. Dollar future positions and recent changes in relative value of the Euro and Silver. The U.S. Dollar and 10-Yr Note are expected to move lower in 2023.

The following charts provide a comparison of 1973 to 2023 turning points. As of September 29, 2023 the Dow is estimated to be in a similar position to where it was on August 22, 1973.

Stock charts courtesy of StockCharts.com.

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Euro: Relative Value vs Dollar

On September 24, 2023 it was noted that the average relative value of silver derivatives moved into a position of being “Extremely Undervalued”. This is also true for the Euro. The following chart is a representative average relative value of the Euro vs. U.S. Dollar. The current position of this relative value provides an expectation that the Euro will change direction and move higher over the next several months. This aligns with the Dollar’s abrupt change in direction noted on September 26, 2023.

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US Dollar: Abrupt Change

Weekly engrbytrade™ futures trading data calculations over the last two weeks indicates there has been an abrupt change in futures trader positions of U.S Dollars that is similar to what occurred in November 2010. The following charts provide some perspective on what is expected over the next several months. This change also aligns with future expectations of silver moving higher, as noted on September 24, 2023.

Stock charts courtesy of StockCharts.com.

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S&P500: Accumulation Channel

In 2022 the Fear and Greed Index dropped below 20 between September 28, 2022 and October 11, 2022. In 2023 it dropped below 20 on March 15, 2023. During each time period, extremely large block trades were observed crossing the tape. As of 5:30 AM ET today the Fear & Greed Index was 34 and it is expected to decline while the S&P500 moves down to the lower trend line of its accumulation channel shown below. This will provide Market Makers with the opportunity to accumulate additional inventory using extremely large block trades, and then move prices back up to fill the August 1, 2023 – August 2, 2023 gap.

Stock chart courtesy of StockCharts.com.

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