The Fed is Lying; We’re Headed for Times Worse Than Great Depression Warns Insider Bert Dohmen
7:55 mark – Stagflation compared to 1970s
S&P500: 2019 Trade Pattern
Engrbytrade™ primary Daily Trade Pattern Structure calculations indicate the S&P500 is in a position similar to where it was on February 4, 2020. Based on key structural data points, the Fibonacci retracement sequence reveals a high correlation to the 2019 trade pattern. Secondary calculations indicate the S&P500 is in a position similar to where it was on November 16, 2021. A decline is still expected.
Stock charts courtesy of StockCharts.com.
Dow/S&P500: Artificial Intelligence Bubble
Prior to the NASDAQ hitting its peak in 2000, a series of events initiated a dot-com bubble that would be remembered for decades. Today we have an Artificial Intelligence bubble headed for the same fate. One clear comparison is the price chart of NVIDA in 2024 vs. Apple in 2000. NVIDA’s price scale is currently 1000 times larger than Apple’s scale in 2000. Overall, the current Artificial Intelligence bubble is expected to be similar to the dot-com bubble with one difference. Instead of large brokerage firms fueling the bubble, very large hedge funds are also participating.
Note that charts shown below are for research purposes only and are not a recommendation.
Stock charts courtesy of StockCharts.com.
Interest Rates: Not the Fed
On April 20, 2024 it was noted that futures traders were repositioning trades with the expectation of a decline in rates. Positioning is reflected in the charts shown below where a 61.35 degree angle from the Y axis appeared in 2018. This same structural angle reappeared between June 2022 and October 2023. It has placed the 10-Yr Note interest rate on a 2018 path. Futures traders are still waiting for a decline in rates. This will be generated by the bond market, not the Fed.
Stock charts courtesy of StockCharts.com.
Dow/S&P500: Global Companies
On May 2, 2024 it was observed that a recent peak of positions in US Equity Futures by Asset Managers was above its 2014 peak. This indicator appeared to have a relatively low correlation to the Dow and S&P500. Further research revealed a high correlation of global companies that included CAT, CVX, IBM, and XOM.
Note that this information is for educational purposes only and not a recommendation.
Charts courtesy of StockCharts.com.
Gold: 2024 Angle Rise
On December 22, 2023 it was noted that daily Engrbytrade™ Gold/U.S Dollar derivative calculations have moved quickly in a direction that confirms gold is nearing the completion of a long term ascending triangle structure. This is similar to what developed during 2008 and 2009. Gold’s recent move confirms a 2024 angle rise of 44.43 degrees. This is similar to the angle rise in 2009. Gold is still expected to conduct a move that is similar to what occurred between 2010 and 2011.
Charts courtesy of StockCharts.com.
Euro: Descending Triangle
Over the past several years futures traders have produced consistent trading patterns. Underlying futures trading data calculations indicate the Euro will continue to follow the current descending triangle pattern. Unless something changes, a falling wedge pattern is expected to follow.
Stock chart courtesy of StockCharts.com.
Dow/S&P500: 2024 IBM Structure
Structural calculations for the 2017 to 2024 IBM structure show similar characteristics and measurements to that of the 1986 – 1987 structure. IBM hit its first peak in May 1987 as compared to the first peak in April 2024. It is possible another peak will occur in October 2024. Based on its current structure, the end result is expected to be a much lower level.
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Interest Rates: 2018 Path
On March 16, 2024 a comparison was made between 10-Yr Note non-commercial futures trader net positions and the 30-Yr Fixed Rate Mortgage Average in 2018 and 2024. Futures traders are currently repositioning trades with the expectation of declining rates, just as they did on November 13, 2018. This has placed the 10-Yr Note interest rate on a 2018 path shown in the charts below. With the current situation, a decline in rates is still expected during 2024 and 2025. Note that during the 2018 interest rate decline between October 4, 2018 and December 24, 2018 the S&P500 dropped 18.9%.
Stock charts courtesy of StockCharts.com.
Silver: Computer Program Selling
On March 30, 2024 it was noted that confirmation was needed in silver before it could move higher. A review of daily Engrbytrade™ calculations currently indicate a pullback within silver’s long term ascending triangle is planned. Similar pullback signals occurred on August 10, 2020 and February 1, 2021. Since April 3, 2024, computer program selling of very large block trades in derivative products, such as SLV, has increased. The long term move upward from silver’s ascending triangle is still expected.
Stock charts courtesy of StockCharts.com.
Dow: January 1973 Decline
On March 27, 1973 a 39.91 degree chart illustrated the expectation of a decline that is similar to what occurred in January 1973. It is not a coincidence that the current trend is similar to January 1973. This decline is expected to continue until key sentiment indicators reach their respective extreme positions.
Be aware of the following.
“Most investors will probably never make money in the market over the long run unless they learn to look at the market as a merchandising operation in which specialists manipulate stock prices in order to sell at retail what they bought at wholesale price levels.”
Richard Ney, Making it in the Market, 1975, page 33
Today’s Market Maker organizational structure controls the merchandising operation.
Stock charts courtesy of StockCharts.com.
Gold: Banks Precious Metal Contracts
On March 27, 2024, the Office of the Comptroller of the Currency released its Quarterly Report on Bank Trading Activity and Derivatives Activities. Table 21 on PDF page 25 shows precious metals derivative contracts held by four major banks. This includes Goldman Sachs, JP Morgan, Citibank and Bank of America. Figure 18 on PDF page 42 shows Notional Amounts of Precious Metal Contracts by Maturity for the 4th quarter of 2023. This move into precious metals by the banks continues to be consistent with data and chart structures discussed in the following Engrbytrade™ posts.
Gold: Long Term Ascending Triangle
It should be noted that prior to January 1, 2022, gold derivatives were categorized with exchange rate derivative contracts rather than precious metals derivative contracts. This changed reported precious metals derivative contract values in 2022 and future years.
S&P500: Peak Short Positions
A historical review of E-Mini S&P500 futures trading data revealed E-Mini S&P500 Non-Commercial net short positions peaked on September 11, 2007. This review also identified an E-Mini S&P500 Non-Commercial net short position peak on May 30, 2023. Placement of 2007 vs. 2023 peak short positions is very similar based on the relative scale of each chart. Placement of these peak short positions aligns with the April 10, 2024 post indicating a decline is expected in 2024.
Stock charts courtesy of StockCharts.com.
S&P500: Key Signal Points Update
On March 24, 2024, it was noted that S&P500 trade patterns indicated algorithms were in the process of developing a structure similar to March 2019 and February 2020. In addition to key signal points identified for 2023 – 2024, one additional point was added on March 25, 2024. This internal trade structure pattern is similar to what occurred between August 15, 2021 and November 17, 2021.
A decline in 2024 is expected.
Stock charts courtesy of StockCharts.com.
Silver: Dollar vs Silver Futures
Additional research developed Engrbytrade™ intermarket futures trading data calculations that identified non-commercial silver futures trader positions relative to the U.S. Dollar. This provided key turning points shown in the chart below. Volatility in silver will continue, but the upward trend is still intact.
Stock chart courtesy of StockCharts.com.
S&P500: Fear and Greed
As of 3:59 p.m. on April 5, 2024 the CNN Fear and Greed Index had a reading of 60. It is in a position similar to where it was in mid-August 2023 with a decline still expected in April – May 2024. When this index moves below 20, it falls into a range where retail investors are selling and Market Makers are accumulating inventory. This occurred in October 2022, March 2023, and October 2023. When the next move below 20 occurs sentiment will be extremely negative as the media provides a wide variety of pessimistic headlines. The media coordinates very closely with the stock exchanges.
The charts shown below are currently in a range where investors have very bullish expectations for the S&P500. Current readings are similar to what occurred in February 2023.
Stock charts courtesy of StockCharts.com.
Silver: Distribution Trades
On March 7, 2024 it was noted that a confirmation move above silver’s ascending triangle was needed before both metals are expected to move higher. The chart below illustrates a technique used by Market Makers to distribute their inventory to retail investors. Prior to the move up in April 2024, short term computer algorithms were initiated by Market Makers to accumulate inventory. A move upward was then made for distribution trades between April 2, 2024 and April 3, 2024. Silver is still expected to stay within its ascending triangle based on the need to fill a futures market gap created on March 1, 2024 at 11:05 a.m.
“If specialists want investors to buy stock, they simply raise stock prices sharply. This creates demand. If they want to cause massive selling, they drop prices precipitously. It is merely a problem in engineering.”
Richard Ney, Making it in the Market, 1975, page 85
Note that the chart shown below is for research purposes only and is not a recommendation.
Stock chart courtesy of StockCharts.com.
Silver: Relative Value Update
On September 24, 2023 a chart was provided to show the relative value of silver derivatives vs. U.S. Dollar. The following relative value update continues to show silver is undervalued and aligns with the expectation of a long term move upward.
Silver: Ascending Triangle Position
On March 7, 2024 an ascending triangle was provided for silver and gold. This noted the need for confirmation in silver before moving significantly higher. In addition to this, the following charts provide a perspective on silver’s current ascending triangle position compared to 1973. An initial move similar to what occurred in the first quarter of 1974 is expected. Economic reasons for this move are outlined on the December 24, 2023 post.
Stock charts courtesy of StockCharts.com.
Interest Rates: Large Block Trades Update
On February 24, 2024, selected charts illustrated 10-Year Note futures trading positions relative to the 30-Year U.S. Treasury Yield. Futures trader positions and yield have remained relatively unchanged up to this point. It has been observed that an increasing number of extremely large block trades have been crossing the tape as a falling wedge forms in the chart shown below. Since late September 2023 volume has been significantly larger than what occurred in 2007, 2008, and late 2018 combined. This would align with the expectation that bond yields will fall as stock markets decline, regardless of what the Federal Reserve does.
Note that the chart shown below is for research purposes only and is not a recommendation.
As always, volume, not price, is the principal guarantor of the markets direction.
Richard Ney, Making it in the Market, 1975, page 129
Stock chart courtesy of StockCharts.com.
Dow: IBM Structure
One big tech company that has been a component of the Dow for decades is IBM. IBM’s structure between July 1972 and February 1973 is very similar to its structure between December 2022 and March 2024. Market Makers appear to be using the 1972 – 1973 IBM structure as a precursor for the next decline. It is not a coincidence that Market Makers are currently using companies, such as IBM, in a merchandising operation to push the Dow to new highs, while companies such as Amgen, Boeing, Nike, United Health, and Walgreens are being driven to lower levels.
It is typical of the specialist’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
Note that this information is for educational purposes only and not a recommendation.
Stock charts courtesy of StockCharts.com.
Dow: January 1973
On March 2, 2024 it was noted that a rise in the Dow between October 2023 and March 2024 was similar to what occurred between October and December 1972. Initial measurements indicate this move followed a 41.46 degree upper trend line. As of March 26, 2024, this measurement was updated in comparison with the peak in January 1973 using an upper trend line measurement of 39.91 degrees.
Stock charts courtesy of StockCharts.com.
S&P500: Key Signal Points
On March 22, 2024 it was noted that Engrbytrade™ daily Dow trade pattern structure calculations indicated a move to dollars was in progress. This is also true for the S&P500. On March 14, 2024 an initial review of S&P500 trade patterns indicated algorithms were in the process of developing a structure that is similar to what was constructed between March 2019 and February 2020.
Additional research identified key signal points on the following dates:
- December 15, 2023, January 30, 2024, February 8, 2024 and March 15, 2024. Two of these points appeared during options expiration with a select group of stocks trading extremely large blocks.
- August 13, 2021, August 24, 2021, November 4, 2021, and November 17, 2021. One day after the last signal, market volatility started to increase and continued to cycle through 2022.
- December 18, 19, 20, 2019, December 23, 2019, January 17, 2020, and February 12, 2020. Seven days after the last signal, markets started a rapid decline.
Based on this history, there is a high probability that another decline is imminent.
Stock charts courtesy of StockCharts.com.
Dow: Move to Dollars
Engrbytrade™ daily trade pattern structure calculations indicate a move to dollars is in progress to avoid another decline in the stock market. In 2021 daily Dow structure decline signals occurred on August 24, 2021, September 17, 2021 and October 26, 2021. The result was a 21.9% decline in the Dow between January 4, 2022 and September 30, 2022
Recent daily Dow structure signals occurred on November 21, 2023, December 15, 2023, and March 4, 2024. Based on this series of Dow signals another significant decline is expected to start in 2024. When this decline occurs the U.S. Dollar will move higher, as it did in 2022.
In addition to the daily pattern structure decline signals shown below, public records indicate Jamie Dimon, Jeff Bezos, Mark Zuckerberg, Leon Black, and the Walton Family have sold a substantial sum of company stock.
Stock charts courtesy of StockCharts.com.
Dow structure decline signals
Bitcoin: Flash Crash
On March 18, 2024 a flash crash occurred in the offshore BitMEX (Seychelles) exchange driving the price of Bitcoin as low as $8900.
This significant decline was initially expected to occur in 2022 based on the Engrbytrade™ Bitcoin Model. It appears someone, or an organization, expected a decline similar to the 1982 – 1985 Euro decline and needed to fill, or cover a trade. Volatility in Bitcoin is expected to pick up, just as the Euro did between 1988 and 1992.
Chart courtesy of StockCharts.com.
