Intermarket structural analysis research
The Dow has moved quickly over the last 33 trading days and is expected to pierce the 261.8% Fibonacci level today, as shown in the chart below. Another example of this type of move occurred between October 18, 1999 and January 14, 2000, within a 63 trading day period. A sharp decline followed after mid-January 2000.
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Comparing data structures covering the last 26 years the Dow has taken shape on a scale that is 100 times larger than the 1913 to 1929 model. The charts shown below compare values of the Dow between 1913 – 1929 and 1997 -2023.
Note that the price range in the Dow on August 23, 1929 (370.0 – 378.70) x100 would overlap with the trading range of 37,051.5 – 37,287.5 on December 14, 2023.
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The first chart shown below provides the Dow’s current calculated trajectory. The second chart is a 2006 – 2008 trajectory for the Dow illustrating how the current trajectory should move.
The Dow’s move above its current line of trajectory is similar to what occurred in November and December of 1916. In the last half of December 1916 the Dow dropped quickly below its line of trajectory and continued to move lower resulting in a 40% decline by December 19, 1917.
The Dow is currently expected to move back in line with its calculated trajectory and continue on its projected line of descent going into November 2024.
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Between June 1, 2023 and December 7, 2023 the Dow has been moving methodically through a trading process similar to what was produced between September 17, 2021 and January 6, 2022. Although the price chart structures are different, daily engrbytrade™ trading calculations produced peak signals on July 21, 2023, September 7, 2023, and November 21, 2023 that are similar to the peak signal pattern produced on October 26, 2021, December 8, 2021, and January 4, 2022.
In addition to the signals noted above, Dow E-Mini futures signals produced on October 26, 2021, December 10, 2021, and January 6, 2022 are similar to the peak signal patterns produced on July 21, 2023, September 8, 2023 and November 22, 2023.
It was also observed that a pattern of extremely large block trades crossed the tape within the trading areas of interest shown below between June 2023 and December 2023, just as they did between September 2021 and January 2022. Based on this comparison of peak signals, a decline is still expected.
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Daily engrbytrade™ Gold to U.S. Dollar calculations on December 6, 2023 gave an indirect signal that aligned with a stock market peak that is similar to what occurred on January 28, 2020 and November 23, 2021. The declines noted below show what occurred after receiving the indirect Gold to U.S. Dollar signals on January 28, 2020 and November 23, 2021.
This observation also aligns with S&P500 traders positioning for a decline, as noted on November 20, 2023.
Dow:
January 28, 2020 – March 23, 2020 decline = -35.27%
November 23, 2021 – October 13, 2022 decline = -16.125%
NDX
January 28, 2020 – March 23, 2020 decline = -22.92%
November 23, 2021 – October 13, 2022 decline = -32.33%
S&P500
January 28, 2020 – March 23, 2020 decline = -31.71%
November 23, 2021 – October 13, 2022 decline = -21.76%
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On July 23, 2023 it was noted that crude oil was under accumulation. Additional futures trading data from crude oil and related natural gas market calculations indicate crude oil is in a long term accumulation period. Crude oil is also in a similar position to where it was in November 2016. Note that as of 12:00 p.m. on December 6, 2023 WTIC dropped below 69.50 and fell within the accumulation channel noted below.
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Based on Structured Block Trading discussed on November 29, 2023, and key gaps in the 5-minute S&P500 futures charts on October 27, 2023, November 1, 2023, and November 3, 2023, an initial target for a decline is expected to reach 4119.20.
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In a process of structured block trading, market makers (and computer algorithms) have created the following chart patterns. While it has been noted that S&P500 futures traders are positioned for a decline, it appears Market Makers are planning to recreate a structure that is similar to what was developed between April 1, 2022 and June 16, 2022. Underlying data within the Apple charts show a total volume of very large block trades processed between December 13, 2021 and March 30, 2022 (point 1 through point 7) are within .01% of the total volume of very large block trades processed between July 19, 2023 and November 27, 2023 (point 1 through point 7). This would indicate a top is close.
Note that this information is for educational purposes only and not a recommendation.
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The 5 minute chart gaps shown below also appear in the futures market 5 minute chart. Large gaps in stocks or stock indices on the stock exchanges may or may not be filled. It has been observed that large gaps in futures market index charts are filled within a relatively short period of time.
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On November 24, 2023 engrbytrade™ intermarket futures trading data calculations show the U.S. Dollar is expected to start moving higher. Similar historical signals occurred on July 28, 2021, January 20, 2022, and July 13, 2023.
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Market Makers have been raising prices quickly while they expedited trading with a rare 69.36 degree linear move upward that has not been seen since November 2018. This expedited move has pushed the Fear and Greed index up to 67 and is equal to what the value was on November 16, 2022.
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Engrbytrade™ futures trading data calculations show that as of November 14, 2023 traders were positioned for a decline. This trade position is similar to what occurred on November 27, 2018.
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On November 2, 2023 the following charts were included with a comparison between 2018 and 2023 10-Yr note rates when the Dow was expected to move up to 35,078 +/- 1%. Since November 2, 2023 the Dow has moved up in a chart structure similar to what was developed between November 2, 2018 and November 9, 2018. On November 15, 2023 the Dow hit a high of 35,051.10. This move indicates 10-Yr rates could start to move lower sooner than expected while stock markets decline.
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Engrbytrade™ futures trading data calculations show the 10-Yr Note is currently in a position similar to where it was on October 16, 2018. An extended decline is expected to occur during 2024.
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Market Makers took the opportunity today to setup a process of filling any remaining gaps going back to August 2, 2023 and distribute significant quantities of inventory as the financial news media encourages retail investors to move into the markets. This opportunity was coordinated with the financial news media based on lower than expected Consumer Price Index numbers. A very large gap was created in the NASDAQ futures chart today when the CPI announcement occurred. Large gaps in the futures market are all filled within a relatively short period of time.
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Engrbytrade™ weekly futures trading data calculation updates indicate the Euro is conducting a rally similar to what occurred in the 2nd quarter of 2021 and December 2009 to January 2010. Based on this update, there is an expectation the Euro will start to turn lower between December 2023 and January 2024. Additional data will be needed to identify a turning point.
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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.
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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.
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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.
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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.
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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.
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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.
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July 21, 2023 – October 6, 2023
October 26, 2021 – December 1, 2021
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
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A closer look at the timing of Congressional military support resolutions, daily fear and greed readings, and block trading patterns revealed the following observations.
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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.
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