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Market Summary
· What a day! But not unexpected.
· A few days ago, I warned about a possible short-term cycle trough at the end of April and an expected bounce. Yesterday, I also posted on X (see my post further below) a target for bottoming today, which materialized.
· I also warned on Monday about early May pension funds inflows positive seasonality, and FED’s day whipsaws.
· All of the above influenced today’s action. The market made a bottom in the morning, followed by a pronounced intraday “Johny Cash” pattern.
· Typically, a gain/loss on the Fed’s day is reversed the next day. But it is not clear what happened today after the Fed. The initial gains were completely reversed late in the day.
· Near-term options remain the same as I discussed in the Sunday Premium report.
· It is still a good strategy to sell the rips (RIPs), i.e., raise cash.
· My intermediate- and long-term views have not changed.
What a Day!
Market data as of close on 1 May 2024.
Magic of Fibonacci Levels & EWT
· I posted the SI silver futures chart on Monday in Premium when SI was at 27.76 and said that SI would hit the black oval, representing a confluence of three relevant Fibonacci levels.
· Guess what? Today, SI hit the black oval, 4% lower; see the chart below.
· BTW, we identified the bottom in mid-February and provided the EW-based roadmap. SI has been following the script closely since then.
TLT Cycles
· In the Premium Newsletter, we have been tracking the correction in TLT (20Y Bonds ETF) and patiently waiting for the correction in progress to complete.
· TLT is not in the time range when the 20W and 40W cycles should bottom and reverse. The chart below shows the composite of these two cycles.
How to Trade Head & Shoulders Pattern
· Several weeks ago we identified in real-timee bearish H&S pattern in overhyped SMCI, while most of FinTweet was looking for a triangle resolution to new highs.
· The chart below shows the Head, two Shoulders, and the Neckline.
· One possibility is to enter the trade when the neckline is broken to the downside.
· The other is to wait for a bounce to revisit the neckline and enter the trade. In the SMCI example, the second option worked like a charm.
· For more information how to trade H&S patterns click here:
To have maximum benefit from the newsletter, it is essential to follow me on X, where I often post important and timely charts between newsletters, like last night and this morning. See the post below.
#SPX has almost reached the 10D target, the red box. After that $SPX should go uo toward the 20D cycle target of 5150-5195. From that sub-5200 area down into October, IMO.
#stockmarkets#StockMarketNews— BraVoCycles Newsletter (@BraVoCycles)
3:28 AM • May 1, 2024
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Cycle Analysis of Major Indexes
Indeed, the expected short-term cycle trough at the end of April materialized, although it was running out of time as it looked late last week. . .
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