US Small Cap 2000 (RUT)

Despite the VIX giving technical analysts a broad market buy signal, beware the downtrend will not subside for at least a week, probably two and can't rule out longer this far out. While WaveTech has been wrong this week for first time in a while regarding the timing and severity this week, it was correct that stocks would end the week lower, and Treasury yields higher. All daily charts of SPX, RUT, TLT and US 30-year Yield (good measure for mortgage rates, risk off markets and yield curve steepness) indicate the same continued direction overall next week, especially by end of next week. They also indicate that reversals are beginning to form, and that we should expect next Wed. or more likely next Friday will hit an extreme in the current direction (stocks and bonds selloff), reverse in a relief rally that is tested week later around May 8 (so another bearish period). Those wanting to reduce risk should wait until after May 8th add long positions.

You can see from this hourly chart that selling pressure has lost momentum, and the INITIAL stages of a bottoming formation is POSSIBLE, based on intraday charts. However, daily chart of RUT (and SPX, NDX, Dow) indicate selling pressure doesn't completely dissipate until a week into May. This bottoming phase allows us to make money in both directions, although small caps continue have a weaker support structure than large caps, which makes sense when rates are in restrictive territory.

As Christopher and I've noted, WaveTech's forecast wasn't right last week for a bounce around this past Tuesday, holding on maybe till today/Thurs., before diving lower by Friday, and especially early next week. But I'll share my interpretation of its updated projections on momentum and moving averages. The 3-hour chart, or half-session chart (9:30-12:30, 12:30-15:30, 15:30-16:00) indicates max weakness was yesterday afternoon. So the selling was so intense, it moved up (earlier) the approximate lowest half-session period (could still be a more granular interval low). It shows overall improvement/uptrend through end of April, but with dips this Friday afternoon, Monday being unclear (leans weak but more likely choppy), and beyond that too early to even discuss. The daily reacts more slowly to market forces than intraday, but it's also a stronger force since longer periods of momentum outweigh shorter intervals, just like an ocean wave formed by a tanker ship that hits a counter direction smaller boat will overwhelm it despite some choppiness when they meet. Daily indicates downtrend continues, we don't see 'relief' stabilization forming until April 29, but with choppiness and a test of the low around May 8, V-E Day anniversary. Beyond that the weekly indicates a multi week rally.

I wonder if Israel is concerned about the stock market. Maybe they’ll hold off retaliation until after it rebounds.

small cap stocks big positive side up move come don't hold selling position buy fast up move come

F this. Goodbye

Wave Tech 0 - 3 this week.

Let’s see. Fed contradicting itself, unrealistic inflation metrics and Israel ready to carpet bomb Iran. Looks like any bounce will be sold. Wave Tech can handle the Middle East

Truly frustrating

What does Wave Tech have to say about what just happened? I assumed Israel attacked which they will at some point

Over the years, I’ve lost at least $800k of opportunity by selling when I got scared. It won’t happen again.

8.5% off its high a little more than two weeks ago, so go ahead and sell. Inflation is by far the biggest small cap bogey man, and it’s a non factor since the historical rate since 1914 is 3.3%. 2% is a pipe dream and the Fed knows it. The only way to get to 2% is a recession, which they won’t let happen. Current infiation is at the historical average.

It's been a few weeks since WaveTech got a day so wrong as yesterday, so close to the date, meaning yesterday looked constructive as late as Friday midday. I did notice late Friday that Monday was looking more volatile but nothing like what actually happened. As of 8:45 AM EST today, today shows weakness to stabilization in the morning and stabilization to some improvement this afternoon, with the real bounce being tomorrow (Wed.) and earlier portion of Thursday, before the next leg lower. This happens sometimes, where unexpected news extends a pattern and defers a reaction, and also can weaken or strengthen that reaction depending on the catalyst. I've seen this in the bond market. Bond yields were forecasted to rollover from bullish to bearish in late March or April, but sticky inflation reports have worsened credit markets, and consequently, all other markets, particularly risk assets like equities and cryptos. Unfortunately, I got suckered into buying IWM calls yesterday sooner than later, and am not confident whether the oversold bounce this week will let me exit without a loss, but I know not sell today.

I’d rather be homeless than sell, so F Wall Street.

Fear gauge at a 6 month high. Time to get back in the water.

Bitcoin is less volatile than snall cap. Maybe I’m in the wrong investment

Looks like I should have sold this morning when I was $83k higher.

Averaging a $20k loss per day for the last two weeks. Assuming it’s oversold now

Despite the loss of the opening's gap up gains, the daily momentum still leans bullish 2:1, whereas Friday all 3 PPMs pointed to a bearish day, and tomorrow all 3 PPMs point bullish. Looking further out, daily still points to another leg of decline beginning by Friday. Next week the daily charts are very bearish but the weekly projection shows improving support if not a positive week, so I need to study those days more. I'm scaling into IWM calls today with expectation to take profits later this week. Don't let some likely selling near session end discourage you from the overall pattern of an oversold bounce forming for tomorrow.

Ok. About done now

hi

hello

Iran attacked, how will it affect rty ?

I didn't get the timing correct on the low today, but so far, it's not made a lot of difference. I'm going to buy IWM calls in the last hour of session today. I'm expecting a robust oversold bounce over the first half of next week. You could use TNA if you don't buy options (or fear the inherent risk and volatility) if IWM isn't worth gains over 2-4 days. Even if Monday heads lower, it should show positive divergence on intraday charts (meaning price lower, momentum heading higher), and will reverse with patience. Have a great weekend. Don't let a bad day or bad week get you down. It's a risky market in some risky times, with inflation and FOMC and (geo/domestic) political uncertainty, so volatility is expected. What's important is to have reliable inputs and different perspectives, and to manage risk by reducing exposure to it. Gold, oil and Bitcoin bulls will realize over the next few to several days that anything that climbed as much and as fast as they have recently, is ready for profit taking, and yes, short selling. Why make money in only one direction? I began short XLE today, seeing a multi week reversal of uptrend, and will do same for GLD midweek next week, and buying SCO to short oil. None of these make sense if you look at the past several weeks, but when you have a tool that can look under the hood at cash flow and momentum changes, and can measure the 1st and 2nd derivatives of rate of change of price, and assign that probabilities of direction based on huge databases of historical data to perform regression analysis of what's most likely to be, just as is done in weather or traffic forecasting, you can spot inflection points, so long as you realize sometimes new inputs require adjusting that forecast, and to scale into securities in case timing was early.

As of 11 AM, it's looking to me like the low is within a half hour or so of 11:30 AM EST, which I'm guessing is still when London exchange closes, although I haven't checked how Daylight Savings Time adjusts that, but London Close is often near an intraday inflection point, although I still think they'll be some weakness near EOD and/or Monday AM, but I'm gonna close my IWM put before 11:30 meeting, at around 120-130% gain since yesterday around 3 pm.