August 21, 2016
Re: Forecasting the Future - Martin Armstrong (MA or Marty) ‘Slingshot Move’ - ‘Phase Transition’ forecasts and signals - Analysis for August 22, 2016 and the Week
Understanding what our Future has in store for us of us is paramount. Moving forward, using historical lessons learned is what will make us winners.
Aided by Socrates (SOC) Marty helps us understand.
Using historic data, MA explains the ‘Slingshot Move’ and ‘Phase Transition’:
In oirder to better to understand
Click here and print this Chart to follow what MA refers to below
“Historically, on July 20, 1998 the market peaked exactly to the day of the ECM. That crash was 58 days and then in 32 days the market rebound to the former high. Note there were three (3) lows with the last and a final low creating the ‘Slingshot move’. These types of moves are the most powerful and very necessary to propel any market to new record highs. You simply must trap the majority on the wrong side of the trend.
The DOT.COM Bubble was the last great capital inflow from around the world. Both Europeans and Asians were pouring money into the DOT.COM Bubble – it was by no means a local event. This move was the classic ‘Phase Transition’. However, when we look at that in terms of the Euro (which we recreated using the same formula extending back in time), we get the same ‘Phase Transition’ rally.
We do not see a stark difference between the patterns in dollars as we see in euros. Hence, this attracted foreign capital creating an explosive rally which we call the‘Phase Transition’.
Now, when we look at the current position of the NASDAQ both in dollars and euros, we see something different. In dollars we made the new highs. However, when looking at this is euros, we do not yet see new highs being made. As always, things are not always as they seem to the local observer.
So the last magic formula going around was the 9 day consecutive decline which was supposed to lead to a crash. OOPS. Here might be another brilliant observation.”
In addition with regard the ‘Slingshot move’, this is what Marty stated on August 11, 2016: “The biggest problem with breaking out without a slingshot move is that there will be far less energy within the market to propel a substantial rally. Is it possible? Of course. Would gold still reach $5,000? Maybe not! Why? From a technical perspective, the slingshot is the best scenario that fuels a market. You can see that even on the daily chart, gold made a minor slingshot making a new low just before the recent rally. That is the mechanism for strong moves.”
Preface, our ‘Day Trading’ last Friday:
At 8:00am EST, I first looked at the SOC analysis for Friday August 18 for Silver which showed Daily: Pressing Higher and Weekly: Testing Support. The Bullish Reversal 1 was 19.8960. The High trade in for the day was 19.800 so, Silver did not break through and it bounced of Bullish Reversal 1.
Because, Silver leads Gold, only then did I look at the SOC analysis for Gold which showed Daily: Caution Knee Jerk Reaction High and Weekly: Pushing Higher. The Bullish Reversal 1 was 1,357.70. The trading High trade in the morning was 1,357.50 so; here it also did bounce off its Bullish Reversal 1.
This was the signal for us to trade the E-mini Gold Futures on the Short side. We shorted them all day long and kept buying them back at lower prices to cover our Shorts with the result that we never lost money on any of our trades and made out very well by the end of the day. Our ROI went up significantly.
The question now is, what should we do for tomorrow August 22 and the rest of the week?
- The SOC forecasts and signals for Silver tomorrow are Daily: Further Decline Still Possible; and Weekly: Temporary Low. The Bullish Reversal 1 is now @ 20.6960. When we look at the Arrays, which give us advanced knowledge for the direction of our trades, then we see that the Composite block is quite large. The Arrays also show a medium block showing a Directional Change. In addition, they show a large Panic Cycle block for that day. So, the Arrays seem to confirm a potential decline for the day;
- The Arrays for the week still show a large Composite block with a medium to large Empirical block and a medium to large Beta Cycle block but, it only shows a small Panic Cycle block.
- Relevant excerpts taken from the SOC Global Market Watch Comments for Gold are: Daily: Moving Lower; and Weekly: Retest Resistance. The Bullish Reversal 1 now is 1,348.10 and 1,349.50 offers some technical overhead resistance for now. Moreover SOC says, 1) the Daily Bullish Reversal we need to watch is 1,373.00 and Gold requires a Daily Closing above this level to signal new Highs lie ahead; and 2) We need a Daily Closing above 1,368.70 to imply a further rally is unfolding technically speaking; and 3) As of the close Fri. Aug. 19, the market is immediately in a Neutral position for right now with a protracted Bearish undertone warning Caution on the Daily Level.
- Importantly, SOC wrote in his analysis last Friday: 1) On the Daily level, our number to watch for tomorrow’s [Monday‘s] opening will be 1,357.90. We need an opening print above that number to maintain any upward momentum. Otherwise, we may see the market finish down by the Close of trading; and 2) On the Weekly time level, the number to watch next week’s opening will be 1,340.73. We need an opening print above that number to maintain any upward momentum. Otherwise, we may see the market finish down by the Close of trading. Caution is advisable if we open beneath this level.
So for the Day tomorrow: Based on the above noted SOC forecasts and signals, I have already decided that I will continue our profitable Day Trade strategy we deployed last Friday and go short the E-Mini Gold Futures and buy them back to cover my the Shorts. For the Week: we probably will continue the same strategy but, that will depend on the SOC Daily analysis from the Trader Level 1.0 which I receive every morning and that we are privy to. It may very well be that the Daily analysis will prompt us to go Long the E-Mini Gold Futures instead.
Friends, the Long-Term Trend for Gold is Bullish and if you are invested Long-Term then you basically have to do nothing and ride the ups and downs but, that will change in the Long, Longer-Term. Please understand with regard what I have written above, I am NOT an expert and I continue to learn how to unravel the SOC forecasts and signals. MA who created SOC is the ultimate SOC interpreter and I did learn again from MA’s Daily Blog he posted this morning. MA writes about Gold and its role in the world and that we have to understand it for what it is. The Blog also explains the Long, Longer-Term.
You can access that Blog post here.
Most of you have a Day Job and cannot be entirely focussed on this therefore; I highly recommend that in addition to reading MA’s Daily Blog that you subscribe to his ‘Investor Level’ service. To benefit your Financial Future, the Private Blog alone is worth the subscription cost.
You can subscribe for the 'Invetor Level' here.
Next Friday August 26 and the last trading day for the week, Janet Yellen has the opportunity to clarify the outlook for rates when she speaks at the Kansas City Fed’s annual symposium in Jackson Hole. Some market watchers are optimistic that Yellen will use her remarks to signal readiness for a September rate hike. However, 1) The SOC ‘Arrays’ do not show that anything drastic will occur next Friday; and 2) I stick with what I wrote in my August 7, 2016 FDNN letter: “I do not expect the FED to raise rates in September because, September is only two (2) months before the elections in November and if the White House wants Hillary elected then a rate hike certainly is to be avoided”.
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Regards from Mining Interactive Corp. in Vancouver Canada, where we enjoy the lazy warm and pleasant days of summer,
Nick L. Nicolaas
Direct: +1 (604) 657-4058
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