There is an outside chance the Fed hikes more than .75 points. There is justification to hike a full point. Should that happen, expect a huge market downside surprise.
The VIX chart is interesting. Coming down to meet the rising trendline suggests it is ready to accelerate upward.
Well, we have reached our wave [ii] target in a most excellent wave structure. The major gap down is not quite closed (5 SPX points).
The alternate count is that the 17 June low is actually an Intermediate (1) wave low – a leading diagonal triangle falling wedge pattern. This would imply a significant advance in price over the next month or so culminating in Intermediate (2). A price rise above blue Minor 2 would be a confirmation.
But do not disregard the “negative” Zweig breadth thrust event that has occurred and has not been “overridden”. Recall this chart from 13 June:
The updated chart through yesterday’s data. A decent poke higher yet the time frame is not significant, nor has it reached above 61.5. So, one must assume the market is still in enthralled by the negative 10-day event. The NYSE has diverged from the overall market. It has not risen above its previous pivot of 15,028.
We shall see. For example, a price move thrust higher Monday to resulting in a reading above 61.5 would be an upside “surprise” that would be very concerning for the overall bearish count.
Therefore, the market is at a major crossroads.
The weekly shows a very slight positive divergence in the RSI but it is a weak signal and considering the negative breadth thrust event as discussed above, we have no reason to change our count to the alternate at this time.
So, we are at a major crossroads for the overall market. Regardless if it rallies in a surprise (2) it is still doomed overall.
Sorry I forgot to publish this post from last night.
Has this rally surprised you? No, Elliott Wave Theory allowed for it or even predicted it. When we had a clear 3 waves down from (a) to “a of (b)” is when we realized that a more complex Minute [ii] or even a higher wave degree Intermediate (2) may be tracing out.
This was a very good reason to be cautious on “rushing” the bear collapse. But the bear collapse is indeed likely coming, this is the last hurrah whether or not the gap gets closed or not.
This blog said almost a month ago, that if that big fat open gap down was to be ever closed, Minute [ii] – at the least – would have to do the job. So, it seems to be panning out.
And finally, the 50 DMA has been reached.
A big problem is that the market is pricing in, at the moment, at least a .75 rate hike later this month by The Fed. In fact, it is on the verge of signaling a full 1-point rate hike.
Higher interest rates bring about debt destruction, defaults, bankruptcies. At some point if interest rates get out of hand (they will) it will bring about a cascading default tsunami. Ultimately asset deflation of the higher end will occur (real estate, luxury goods, the markets). Yet at the same time due to constrained markets and broken “just in time” supply system (the effects of supply and demand) the world has depended upon, lower end rates will stay elevated just enough to bankrupt the poor people.
So, asset deflation hurts the rich, yet a continuing – and intentional – supply and demand disruption will continue to destroy the poor. $5 a gallon gas does not hurt the rich, but a massive high end asset inflation does. A collapsing Ponzi scheme worldwide market will bring about massive deflation. A broken supply system will ensure the poor do not “benefit” from a deflationary overall environment.
I have always called this a “rising interest rate inflationary depression”. A depression in which the high-end assets deflate but the low-end assets (food, energy, basic living needs) remain elevated thus destroying both ends of the spectrum at the same time. I am theorizing that the world is about to enter this phase if not already in it.
Inflation is not just a monetary effect, supply and demand is also a factor along with of course social mood trends.
I liken it to an analogy of a hot air balloon that is sent into the stratosphere flying so high that the human passengers perish due to the ascent into the thin oxygen “death” zone. And the sheer height of the balloon eventually brings about its own demise: ice, weight, and a lack of oxygen will bear upon it until it reverses and deflates at a rapid rate and at some point, rips apart on its descent.
And even if the occupants of the balloon survived the very peak ascent point, the resulting descent and crash and destruction of the hot air balloon will result in them dying, nonetheless.
I kind of see this grinding inflation in light of this high-flying balloon analogy. Slowing taking us up to 40,000 feet and we either die outright, or we die when we hit the ground because our very balloon gets ripped beyond repair on the way down.
What would 6% interest rates do? What would 10% do? What would 18% do? Certainly, no longer inflation, but hyper deflation.
It really doesn’t matter anymore; forces have already unleashed that are beyond anyone’s control and the inevitable is massive asset deflation and collapse of the system.
And if they printed money to try and reverse it, it would still result in collapse of the system. But that is the entire secret strategy of the elites in charge: to collapse the system one way or another so they can bring about another system in their image and liking. The Beast system to come that the bible predicts.
A notable drop off in daily volume which reflects the summer vacation season. We had the same setup in the summer of 2008. After sharply rising in early July 2008, prices meandered in a general sideways fashion never regaining previous pivots.
We have a 5-wave impulse down ending at today’s low which could wave c of a 3-3-5 flat situation. Let’s go with it for now and assume the lazy summer trading will continue to be held in this 5% trading range or so.
A break beneath today’s low would be a very bearish sign and likely result in a test of the 17 June lows.
Let’s throw this up and see if it sticks. But in my heart, I’m rooting for a total market crash. The subwave count of [ii] of 3 of (3) implies we are close to that point.
Short term rates. The market is at least .75 points behind the market. The green box projects a 1 point raise.
It’s getting out of hand. Even only 3% rate will bankrupt the government. Its coming folks. That which cannot go on forever, won’t.
God is forever, this Ponzi market is not.
Giving the count the benefit of the doubt. A solid break beneath “a” would negate things.
The only rule of a 5-3-5 zigzag is that wave (c) must finish greater than wave (a).
Seems destined to meet the 50 DMA.
I haven’t talked much about the False Prophet of the bible because according to my timeline he won’t be pumping up and promoting the Antichrist until later in 2023. The False Prophet of Revelation is a person (possessed by a high-level demon) who promotes the Antichrist. I have proposed the Antichrist is Volodymyr Zelenskyy. Eventually the False Prophet will emerge that “promotes” the Antichrist to the world as being the Messiah to all of mankind.
Obviously, a lot of world leaders have actually been doing that very thing and I could conclude that one of them is the False Prophet. Yet, I don’t think that is how it will play out. Macron a False Prophet? Trudeau? Hardly. I think there may be a lot of people jockeying for that position, but the REAL False Prophet has yet to emerge.
Yet at the same time, obviously the False Prophet is already a living adult man. And that man would probably have great influence and perhaps actually be a billionaire who controls/owns the means of mass global communication to be able to carry out the plans of Satan of promoting the Antichrist to position of NWO world leader. Is there such a person today?
Yes. Elon Musk. My early frontrunner for False Prophet. A man who is neither hot nor cold, neither completely hated nor completely loved by all sides of the political spectrum. A truly weird man. He owns Starlink which will likely survive the coming God’s wrath period and now he bought Twitter, the means to communicate to the world. He is reprobate and not a Christian, is a WEF member, and he would agree in large part with the now demolished 10 Satanic commandments of the Georgia Guidestones.
This is where I will leave things. The proposed Antichrist (Zelenskyy) has yet even to defeat the first global nuclear armed power of 3 that the bible predicts. If Z man is not the Antichrist, then he will not win. It’s that simple. But going on 5 months, the Ukrainians have yet to experience a real loss of any of the big 3: Odessa, Kharkiv, or Kiev. Too many cheerleaders for Russia, but the bible predicts they will lose if Zelenskyy is the Antichrist. The bible prophesizes that the NWO will succeed.
Elon Musk is the frontrunner for the coming False Prophet. He is a transhumanist. He owns Neuralink. He owns Starlink and the means to launch the satellites in Space X. He owns an electric car company for when the global fuel supply collapses ala “Mad Max”. He is buying a global media communications company Twitter. He is not a Christian and I sense he is reprobate (rejected Jesus Christ) already. He is a WEF member. He is a globalist. A “New Age” prophet.
And he is the richest person in the world. He can make top bid and that might just buy him the title of False Prophet. Only time will tell…
He has already helped Zelenskyy via Starlink
THE COUNT
Not going to mess with things, this chart is working like a charm,
