The Brexit vote has triggered an intermediate cycle decline in the stock market. I’m expecting a bear flag and then a final drop into the bottom, but traders also have to be wary of an intervention that could terminate the rest of the decline prematurely. We may have gotten the bottom yesterday. This is why I don’t sell short. You are fighting an opponent with a printing press.

Brexit Vote and Stocks
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  1. Gary Post author

    Well let’s see how many get this wrong again. At every single daily and intermediate cycle bottom the same people miss the turn time after time after time. You would think eventually they would learn but they never do.

    We are going to new all-time highs, and I mean big new highs in the years ahead, but most clueless traders are still stuck looking for a repeat of 2008. We aren’t going to make that mistake again. Governments will crank up the printing presses long before they let that happen.

    The mistake isn’t going to be a crash. As a matter of fact it will be the opposite. They will create another bubble, or more likely another series of bubbles.

    Then the markets will crash. But not until the after the bubbles pop.

  2. shine07

    Gary when or how do we know that the ICL is done or should wait for an A-B-C structure downwards?

    1. Gary Post author

      It’s become something of a guessing game in our modern managed markets. Back in February the PPT stepped in and stopped the ICL prematurely on day 18.

      If I think the PPT is intervening again then I will just go back to leveraged ETF’s.

      Either way though the stock:bond ratio is saying the bottom is close if it didn’t already occur yesterday.

          1. Don

            On May 16, Gary said “Before this rally is finished we are going to see excessively bullish sentiment and oil will test $60. ” What more needs to be said?

  3. tulip

    Gary- brevet may have changed the ‘culture; of the establishment, at least I hope so. The establishment has raped & plundered for long enough.
    It isn’t clear printing presses & bail outs will go on as before,,, despite brevet not being approved by the parliament. It is a mindset in motion now.

  4. Joseph69

    Gary, the Bears been right with this decline and you paint it like they were wrong. If you look at the vix, they were busy covering yesterday.

    Just look at Surf. He nailed the bottom.
    Give credit where credit is due man.
    And eat crow when you are wrong.

    1. Gary Post author

      Pleeeeze… no one was brave enough to short ahead of the Brexit with everything pointing toward the stay camp. So everyone missed the drop Friday. At best you might have made some money if you went short for Monday but you are now at risk of losing those gains if an intervention is happening.

      I will be right again and we will get an ICL soon and then go on to make new highs. The Brexit only delayed the breakout, it didn’t stop it.

      1. Surf City

        Sorry Gary but I went short starting on 6/14 when the SPX broke my Daily Cycle trend line and added to my short positions on 6/20 when the SPX broke my IC trend line. For months, I have also been forecasting the next IC Low in stocks between late June and mid-July which is where you were saying we would be seeing a move to all time highs.

        I also took profits on my shorts yesterday and posted all of this in real time on GoldTent and/or Rambus based on my near term price channels which I use in addition to cycles.

      2. Joseph69

        But you only been right for spurts. Market hasn’t made new highs.
        Look at all your pounding the buy button post over the past 2 months. Everyone is under water….

        1. Gary Post author

          You are trying to extrapolate what we are doing by a few posts on the free blog. We are up 56% in the stock portfolio. I took profits on leveraged positions ahead of the Brexit and now we are waiting for an opportunity to reenter leveraged positions at the intermediate cycle low.

          You need to get at least a monthly subscription if you want to track our trades in real time.

          1. Surf City

            Gary, my response above was to your post that no one was brave enough to short before the Brexit. On this point you were wrong as I ignored the Brexit and shorted ahead of it based on my cycle trend lines and other TA including price channels.

            Regarding the Brexit,however, in my experience, Bear Markets deliver surprises to the downside. 😉

            That is where you and I differ in our cycle analysis on the longer 7 year cycle. You clearly feel the bottom is in while I believe the jury is still out and that the stock market still has much to prove, especially after a false breakout which is very similar to what we saw back in the 2000-02 Bear Market.

          2. Gary Post author

            I doubt anyone really believes you held onto your short through the big surge on Wednesday. You would be simply gambling on the vote going the unexpected way with a huge penalty if you were wrong. I don’t think you actually made a gamble like that. That’s the difference posting something to a blog with no one following your calls. I on the other hand have 3000 subs following my analysis, and I would not roll the dice like that, not when the larger trend is now up.

            Like I said some might have made some money trying to short Friday before the close, but as you can see by end of the day they’ve given back all of their gains.

      3. Anthonyo

        First of all Surf is a shill and an idiot who had a lucky shot of No on Brexit saving his butt on a one time lucky shot. Even a broken clock is right one moment per day. Only a Black Swan event saves an idiot from himself. The real trend is UP.

        Secondly, Brexit “No” is an illusion.
        The UK Tories already have different “exit models” which will greatly lessen the impact of the “no” vote. You just wait and see how they will twist this “no” vote and dilute it in actions to come.
        The raw data “no” vote “won”; but there are other ways of skinning that cat, and Tories already have plans in place on “how” to exit.
        You will never see a 100% out right exit economically and financially.

        Don’t get excited folks, globalists don’t lose in our current world. They just take temporary steps back to re-group and distort outcomes.

  5. Don

    “We are going to new all-time highs, and I mean big new highs in the years ahead”. Does that mean there will be no more short term trading on your part Gary? Just buy and hold will now the best methodology?

    1. Gary Post author

      I try to avoid cycle lows because most people aren’t emotionally equipped to handle them. But if one has seen enough of them to not get rattled anymore then you can certainly take an Old Turkey position in stocks as well as gold. I think in the long run biotech will vastly outperform just about every sector other than miners.

  6. Don

    WEAT looks like a good bet, now at 8.47. I”m sure everyone remembers my call on Natural Gas a few months back.

      1. Don

        Over the years, I have made more money trading natural gas than any other sector. Maybe that’s because with NG, fundamentals always prevail within a relatively short time frame. ( and maybe because it is of no interest to the PPT).

    1. Surf City

      Bought WEAT yesterday and am adding today. The low may not be in yet but it should be close enough. CORN is also getting close but looks like it has a bit more downside based on my price channel work.

      1. Don

        Surf, we must think alike, I too bought heavily into WEAT yesterday. When the grains rally, it can be quite explosive. Let.s see what happens. Surf, do you see today’s rally in the stock market reversing today, after a few days, or not at all (just up)?

        1. Surf City

          Don, Stocks have begun their move into the next ICL based on my cycle work but we are now bouncing out of an oversold half cycle low on day 27. Hard to say how long the bounce lasts as the SPX is now backtesting the 200sma.

          My expectations are that the move into the ICL is not done yet and I will likely re-enter my shorts at the top of my price channel. If so, I will try and post as close to real time as possible over on GoldTent and then post the links here for those interested.

      2. Anthonyo

        Can’t even spell right; what an idiot.

        Your brain is full of “WEAT” and “Corn” You are so corny and irritable. lol.

        1. Surf City

          Anthonoyo, It is actually you that are showing your ignorance here as WEAT is the ETF that invests in Wheat Futures. 😉

          1. Anthonyo

            You idiot Surf, you don’t even understand sarcasm. You moron shill. Off with you pest.

  7. Joseph69

    Gary for heaven sake, take a look at the S&P chart.
    It is trading below 3 month of action. It got to early March levels yesterday at 1990. You been telling folks about this explosive move for months and it’s been a turd. That’s the truth.

  8. Joseph69

    Your call of a bear flag here and a lower low into 1960 only validate your miscues the prior 3 months. Instead of selling into those rallies in April to May, you got folks into LONG positions (energy/biotechs) that are severely under water right now.

    1. Gary Post author

      I responded above. We have not been losing money we have been making tons of money in the stock portfolio. You need to get a monthly subscription so you can get the real time trade alerts.

    1. Gary Post author

      It is starting to look that way. If we rally again tomorrow I would tend to think the rest of the ICL has been terminated by the PPT.

  9. Don

    Surf, just ignore Anthonyo. He has no idea how to be civil and his ignorance is apparent for all to see.

  10. heybuddy

    SPX within a point of closing yesterdays gap down. Could be a logical stopping point for the initial rally. Also very close to retracing .38 of move down from 2113. If you’re bearish then you wouldn’t want to see much more to the upside from here.

    1. Gary Post author

      I’m going to suggest that the SPX should break back above 2040 unless the ICL has been terminated prematurely.

      This is why I don’t short.

Comments are closed.