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Wednesday, September 2, 2015

An Advanced Concept Tail wags dog Market Forecast

So I was just doing my yoga, thinking about the market and what it was going to do and I formulated a picture of what I think is going to happen. I think that the market is going to fight back and rise and then it is going to blow out and drop pretty hard. How did I come up with this conclusion?
From my tail wags the dog theory. Not only do I look at the ETFs for info I will also double check with some big blue chips to see what they are feeling technically. If I see a few death graveyard crosses in a few of them like I see in AAPL and IBM today, this is telling me that these blue chips are going to drop and weigh in on the ETFs. I can also assume if I see enough of these that other blue chips are also having macro problems as well in respect to the markets via large global forces. Lets look at some charts. First, the QQQ.

See the recent two candles? That is two candles in revere of one another with the tails and that is signaling a reversal thats coming. Ok, thats the cubes, now lets look behind the scenes of QQQ and look at SPY..

Spy is telling a different story. It is Not saying reversal, instead it is showing a bit more up to come, but things will eventually continue down. You can see that the candle before today here has some of a bottom showing.

So as to my theory..here is AAPL and IBM

Both of these are showing death crosses. These macro stocks are showing weakness. While I understand there are forces inside the company that is causing this, they do not operate in a vacuum. They exist in a global economy and the global economy is sick. If these drop, the indexes see it and it affects them as well. The tail does wag the dog to some extent.

So that is my new system of forecasting and I feel that it is pretty accurate, at least it gives me an extra edge and vision of the market as a whole. So what do I see the market doing?

I dont feel that this is over. Asia still bled last night and China still has big problems. The larger ETFs are saying that things will wander up a bit, but then I feel we are going to have a shocking down day, then a few after shocks again until things stabilize. Then another bout of down for a few days. This is when everyone will be shaken up. The Dow will find a bottom and things will recover and slowly climb for 6-8 months. And then: the big one. The crash of 2016. More on that later.

Be cautious for the next few days of up/side chop, and then look for the drop.

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