Intermarket structural analysis research
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.
As noted on July 26, 2024, structure is important. Prior to the current decline Market Makers pushed prices higher on July 17, 2024 using their standard practice of distributing extremely large blocks at the close. Algorithms continue to move the Dow down to its 8.92 degree trend line shown below before moving higher.
Note that this information is for educational purposes only and not a recommendation.
Chart courtesy of StockCharts.com.
During the last half of May 2024 algorithms followed a pattern shown in the first chart that could be identified as an engrbytrade Eight Point Trading ModelTM . The second chart provides a template for this model. It should be noted that this structure is important and appears to have started once again in the third chart. This will provide the timing needed to replicate its 2021 structure time frame.
Charts courtesy of StockCharts.com.
On July 1, 2024 it was noted that bond traders were preparing for a stock market decline. It still appears that a stock market decline is expected based on the following.
It looks like the Federal Reserve is following a path similar to 2007. On Friday, August 17, 2007, the Federal Reserve dropped the discount rate one half of a percentage point due to concerns about the subprime lending crisis. A FOMC meeting is scheduled for July 30-31, 2024 with no rate cut expected. A drop in the discount rate in August due to a “lending crisis” would provide a path for a significant market decline in 2025.
Stock charts courtesy of StockCharts.com.
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.
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.
The following charts show the Dow appears to be following its 2021 structure time frame. Another turn upward from the 8.92 degree trend line will confirm this market structure was created for a predetermined time frame. Using the current time frame a peak in September – October 2024 would be expected.
Chart courtesy of StockCharts.com.
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.
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.
Veteran Wall Street Trader Reveals Strategies Used At Stock Exchanges
Richie Naso points out that algorithms and Market Makers control the market.
This is only for educational purposes. Not financial advice.
The Dow 2003 – 2024 monthly chart structure continues to follow the Dow 1918 – 1929 monthly chart structure, as shown below. Based on these structures it indicates the Dow still has room to move higher and pass the 461.80% Fibonacci level. This would certainly take sentiment to a level we have not seen for some time.
Charts courtesy of StockCharts.com.
As of July 9, 2024, Engrbytrade™ futures data calculations show silver total reportable positions are similar to the data recorded on August 24, 2010. Silver is expected to continue moving higher as is did in late 2010 and early 2011.
Charts courtesy of StockCharts.com.
Based on the current NAAIM exposure index and CNN Fear and Greed Index, investor sentiment is not in an extreme position. Estimates indicate the Dow is currently in a position that is similar to where it was in October 2021. The charts below have been updated to reflect this. This means there is room to move higher, as noted on July 11, 2024.
Charts courtesy of StockCharts.com.
The following is a textbook example of what Richard Ney described in his book, Making it in the Market. TLT Market Makers were selling on light volume as they moved through a descending triangle, followed by a decline in 2023. Extremely large block trades started to appear in mid-November 2023 and still continue to occur. This is the current accumulation process where Market Makers are buying their wholesale inventory at the lows. When that is complete they will raise the price in order to sell at a higher retail price level.
“It is only when they (Market Makers formerly known as Specialists) are able to decline on light volume that they can afford to carry the decline to lower prices.”
Richard Ney, Making it in the Market, 1975, page 89
“To understand the specialists’ practices, the investor must learn to think of specialists as merchants who want to sell an inventory of stock at retail price levels.”
Richard Ney, Wall Street Gang, 1974, page 85
Note that this information is for educational purposes only and not a recommendation.
Chart courtesy of StockCharts.com.
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.
Since June 2022 the NAAIM exposure index has been moving upward on an 18.32 degree trend line. Based on this trend it appears, at the moment, there is room for markets to move higher.
Chart courtesy of StockCharts.com.
Gold is currently in a position that is similar to where it was in the second quarter of 2022. A pullback is expected in 2024 prior to moving higher. This pattern is also similar to that of the late 1970s.
Charts courtesy of StockCharts.com.
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.
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.
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.
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.
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.
On August 15, 1971 Richard Nixon announced the suspension of converting dollars into gold or other reserve assets. This event was followed by silver prices moving higher between 1971 and 1974.
On June 6, 1974 the Saudi Petrodollar Memorandum of Conversation was issued. This initiated the process of Saudi Arabia investing proceeds of oil sales into U.S. Treasury’s. It also provided the U.S with a global reserve currency. The price of silver continued to rise as Economic Recovery and Bailout Packages continued to grow exponentially.
Forty years later a select group of countries signed the BRICS Development Bank Treaty in July, 2014. This bank will simplify settlement and lending among BRICS countries and reduce the dependence on U.S. Dollars and Euros for trade. It will also start a long term trend of Dollars moving back to the U.S. as countries around the world conduct trade with their own currencies. The price of silver is expected to move higher over the long term as this process continues.
Charts courtesy of StockCharts.com.
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.
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
2020 – 2024
Charts courtesy of StockCharts.com.
