As a companion to my posting yesterday of the GDX chicken-scratch, here's another poultry-created masterpiece: a trio of Euro drawings with my best attempt at marking the "matched" points of this analog. The charts speak for themselves. Whether or not this pans out a third time remains to be seen. So far, so good, though.....
Even occasional readers are acquainted with my near-obsession over the gold miners ETF symbol GDX. I have been closely following an analog I discovered for GDX, and last week I printed it out, took pencil in hand, and clumsily scratched out what seems to be the turning points of the analog.
Below is the 2007-2008 timeframe. Please note these letters have no special meaning, except to order and identify the turning points. For the love of God, don't mistake this for some kind of attempt at Elliott Wave (cough, cough).
 |
Happy New Year! It may not be Open Season, but we are approaching January Opex Season. We bring you another episode in our fun game of Math-You-Won't-Find-Anywhere-Else, only this time it's Opex Seasonality. We compiled data from our Personal Trading Almanac to build a profile of how the major indexes perform on average each options expiration week. The data goes back 22 years and sniffs out the opex week price action from more than 5,500 data points. What's interesting is that January Opex has one of the few bearish opex week tendencies of the year. Over the past 22 years, the S&P 500s closed opex week in negative territory 63% of the time. Of course, this year can very well be different. Employment is stabilizing, the markets are shrugging off Euro debt zones, and it's an election year. But for those about to short, stay thirsty my friends... |
Continue reading "Opex Seasonality (by Trade Flight Plan)" »
It actually fits quite nicely in the context of the oft-mentioned analog.
In prior posts, I've mentioned the interesting comparison of the $HUI gold index between 2006-2008 and the past couple of years. Below is the grid chart showing the past behavior on top and the recent behavior on the bottom. The analog speaks for itself.
Instead of just eyeballing the charts, I entered the dates into a spreadsheet of the difference in time between the major turning points. The length of time is quite similar, although the present instance is just a little shorter (95.5% of the length) that the prior one.
The interesting thing is calculating what this adjusted delta yields in terms of a "start date" for a breakdown in the pattern. The date turns out to be January 21st (a Saturday, but hey, it's just an estimate).
Can we count on some kind of hard fall starting then? Of course not. But at least it pinpoints a day for this analog to see if some kind of breakdown does indeed occur around then.
I have been harping on shorting the Euro for weeks, and the analog just keeps unfolding beautifully. I think it'll be months before it turns around.
I'm going to forego a video update tonight and give a quick overview of the indexes the old-fashioned way (incidentally, thank you to the handful of folks who did click Donate, prompted from last night's video; it is much appreciated).
Let me start with the closest I'm going to come to a "bullish" scenario (which is why I bought a very big slug of SPY after the close.........just in case). This scenario provides for a bounce at this point to approximately the highest levels seen earlier in December. Below is the $HUI analog to illustrate this. Such a push would be the last bout of strength before big-time weakness kicked in.
This is going to be quick.....I am seeing more and more stocks which are playing out their past history from 2008. So as fascinating as it is that indexes and currencies are aping their past lives, it's even more interesting to me that individual equities are doing the same (in some selected cases). Here's one example.
