Charles Nenner update.
Dow
Nenner: Dow Triple Down Cycle
The Dow Jones is entering a triple down cycle.
It coincides with a crash in the Kilian Zhou economic activity.
Air traffic Vs. Dow Jones
As flights went down due to the coronavirus, stocks and oil crashed as well.
Megaphone Pattern Revisited in Dow Jones
Megaphone Formation in Dow Jones
Smart Money Flow Index Vs. Dow Jones
Smart Money Flow Index |
These heavy hitters also have the best possible information available to them and they do have the edge on all the other market participants. It is a clear buy signal if the Dow falls to a new low which is not confirmed by the SMFI. But whenever the Dow makes a high which is not confirmed by the SMFI there is trouble ahead (Chart below). Watching this indicator is like being on a plane and see the pilots jumping off with parachutes. This magnificent indicator has called every major top and bottom.
Another index is the SMI index. The basic formula for SMI is:
Today’s SMI reading = yesterday’s SMI – opening gain or loss + last hour change
For example, the SMI closed yesterday at 10000. During the first 30 minutes of today’s trading, the DJIA has gained a total of 100 points. During the final hour, the DJIA has lost 80 points. So, today’s SMI is 10000 – 100 + -80 = 9820.
So basically, when you see people buy at the opening and sell into the close, you should become bearish.
China’s Impact on the U.S. markets
China's Impact on the U.S. Markets
First off, China’s import and export market has trended down since 2010 and lately we see a huge slowdown in China’s imports/exports. The possible reason behind this is because China is now winding down its commodity financing deals. I have pointed this out here. Basically, Chinese imports and exports of commodities were artificially kept up by this hot money coming into China. When all of this unwinds, we will see industrial commodities plunge and we are seeing it right now. Gold on the other hand will become a safe haven.
Read on here.
Total credit market debt Vs. Dow Jones
The U.S. Government Has Invented a New Way of Calculating GDP
In March 2013, the U.S. government invented a new way of calculating GDP. The Financial Times reported that from July 2013 onwards, the U.S. GDP would become 3% bigger due to a change in statistics. As this adjustment in GDP calculation is pretty significant, I will try to make an observation on which changes on the U.S. GDP will take effect, what the consequences are and how investors should act on this revision in statistics.
Read more here.