40 thoughts on “CHALLENGE UPDATE – January

  1. Gary Post author

    Now this is truly hilarious: ” The problem this introduces is the fact that they cannot forecast the big events because they cannot see them coming.”

    This from a guy that didn’t see the bottom in gold, or the top for that matter. Missed the top in the dollar. The top of the 7 YC in stocks. The bottom of the 7 YC in stocks. And the bottom in the CRB.

      1. Gary Post author

        Are you going to be smart enough to use the pullback as the buying opportunity it is?

        Remember the intermediate cycle is extremely right translated. That confirms this isn’t a top, only a brief profit taking event and a breather before the next leg up gets underway.

        10,000 is going to be a piece of cake. 20,000 isn’t out of the question when we get to the really nutty phase.

      2. cazabrujas

        This is exactly what we need to reset sentiment and to get more fuel for the SM to keep climbing.

  2. Gary Post author

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    Remember I warned once the bubble popped bitcoin would make a beeline back down to the 200 DMA? There would be at least one dead cat bounce on the way down to keep all the faithful hoping and holding.

    But… the rubber band theory demands a reaction proportional to the initial stretch. Bitcoin stretched an obscene amount above the 200 DMA at the top. It should shoot far below the 200 DMA before this initial collapse is over.

  3. Gary Post author

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    During the tech bubble every push to oversold triggered the next rally. And one dip in November even failed to make it back to oversold before reversing.

    We are getting close to those oversold conditions, and one must be careful if this happens to be one of those times when price doesn’t make it to oversold before resuming the uptrend.

    1. Gary Post author

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      Getting close. Don’t ignore the possibility that price may not reach oversold before turning back up.

      1. ras

        Looks like FOMC meeting acted as a speed breaker to Gary’s SM parabola. No need for panic. It could take a few days for tqqq to get into a config similar to that in early Jan. After 18 days of uninterrupted vertical rise, price is entitled to a bit of cooling off period.

  4. Spanky

    Well we will see how they close, but the silver miners are at least not totally breaking down today with silver down over a percent. Still plenty of time for them to tank but I’ll take anything even slightly positive at this point.

    Looks like silver is going to drag this out to the absolute bitter end before showing its long term hand. Gold’s 5 week RSI certainly indicates gold could be in for some weakness into next week based on history.

    1. Nada

      We have not even had a close below the 10ma – the DCL is days if not weeks away. The pain has yet to occur.

      1. Gary Post author

        We still don’t know for sure that the daily cycle has topped yet. If gold is flagging while the euro gathers steam for a final push to test the bear trend line then a test of 1377 is still in the cards before the cycle tops.

        This is why it’s so hard to trade this sector. Cycles are stretching because they are being driven by the crazy currency markets which are being driven by central bank manipulation during the ongoing currency wars.

  5. Gary Post author

    Watch 7000 on the NDX. When that breaks the next leg up will begin and it should be even more aggressive than January.

    The semi’s are holding above 1362 so far.

    Don’t fall in love with the downside.

  6. Goild

    Get on board with 250 SQQQ shares.
    Do not be a chicken, get in!

    Tomorrow at the close I will get another 250 as it is pay day and likely the SM will be up.

      1. Goild

        Yes, I am short QQQ with 250 SQQQ shares.
        I should make $1000 when SQQQ hits $21.
        The probability is in favor of the Nasdaq falling.

  7. Goild

    Now, let us assume that SQQQ gets instead to $13. Then I will double or triple.
    And them my chances of getting even would be very high, I think.
    I see it as a no brainer trade.
    The uprising this January is likely due to the earning season.
    The party is over, in my view.

  8. Jim Dandy

    GBTC is UGLY, going straight to the 200 MA, Teddybuns better hope it takes a break there, but it might not until all the sucker premium gets taken out of it.

    http://schrts.co/5YNCNX

    Wow, moving over to miners from the imaginary coin bubble in December would´ve been the trade of a lifetime. I wonder if Charlie Lee bought metals when he cashed out all of his billions?

    Bitsploink just traded in the 8K´s (now futures halted for circuit breaker), and I should update the above chart to reflect the additional 5% GBTC has lost in the last half hour.

  9. Bob

    In my personal account, I looked at the potentials, even if QQQ rose at a consistent rate ($15./month) as opposed to parabolic, and then couldn’t resist getting onside with a mixture of options for April, May and June while imagining what parabolic would result in. I now know why Gary cautions against, given the extent of downside which can be experienced. I find it’s easier to just not look at those accounts right now and go play in the snow until things change.

    1. golddigger

      I’m with you Bob. P/C ratio saying easy money for the next few months at least according to our guide. I did the same but gave the Dow some love too.

      I’ve learned those morning spreads are wicked so even in an OH DARN situation never panic sell in the AM or you will be punished. Also when buying throwing out a stupid low order a dime away from the bid can sometimes get you a stellar entry in the Am!

      I’m new to options so if others have any tricks Im all ears….

      1. Bob

        I’m looking at being at $185 in Q’s at the end of February so that will be my next point of evaluation. Until then, unless something very horrible happens, no changes. There’s plenty of time to get to 185.

    1. jake

      LoL I wondered how long it would take “Spanky” (PED reincarnate) to burst his bubble and blow his cover.

  10. Herman

    on the 4-hourly, it looks like EURUSD is forming a reversed head and shoulders.

    Or am I overinterpreting?

  11. isavage

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    Nada – Still loving this chart you posted in Dec. fits with my call also at the time for the “Good Entry point” for the banks once CME & CBOE futures in place.

    Its time for the Crypto believers to start the accumulation here 😉 Gary could be right though for 200 Day tag. Worse and game over begins!

    Out of interest where did you find that chart?

    1. Jim Dandy

      The decline has further to go, if I had to wager. So far, February has started off worse than January. Buying dips in bull markets pays off, buying busted parabolas aren´t good for more than a bounce unless you can wait several years. There are too many people underwater now, so there will be selling all the way up and keeping a lid on the upside, maybe even some of our resident bitclowns trying to save what little gains they might have left.

      1. Jake

        I think Bitcoin has a date with at least the mid 4K range.
        For all those latecomers that mortgaged the house and used their CC’s to buy tokens, there is sure to be that “aha” moment when they realize they are not getting their money back much less their anticipated riches.
        The panic should get pretty intense at some point here.
        Just another lesson for the history books.

        1. Jim Dandy

          You could be right, and it will likely get there in a hurry as the panic is setting in. As we have said many times, they better sell any bounce they can get.

  12. isavage

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    BTC 78% Fib hit today. I was buying Not BTC But Crypto/Blockchain stocks. i have pointed out in Dec i would not be surprised to see new leadership/rotation to ETH or other coming out of this pullback.

    Bitcoin is down 36% YTD and Ethereum is up 38% YTD…

    Seems to all be playing out perfectly 🙂

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