FWIW I think the unemployment trend and the yen carry trade ending isn’t over yet .
We just saw how fragile the markets actually are with such a volatility spike imo .

I don't either but it aint a crash. Yet anyway? Right now it's first real correction we have had in a while. These are very normal. They almost always feel scary and almost never turn into crashes.

Yup. You can draw whatever you want. Uptrend is till intact

Well the reason that I like charts is they don't lie.

They don't have opinions, they aren't trying to sell you something, they are just the charts. They are what they are.

If you're black line makes you feel better, stocks did crash at the exact point of you're intersection on March 2020.

but why does that chart say "buyer beware"

I don't know man try to figure it out.

do you not realize at all that anytime you chart between two historical peaks you're going to find a crash immediately following?

there's countless instances where you can chart it on an upswing and it didn't fall but continued to rise, i imagine during those times people were also charting and saying "we're at the peak, time to get out"

to illustrate the point



like i'm with you that's it's good to objective info - that's a huge part of my dfs ventures where I see what the model objectively spit out and then will often deviate from what it suggests i do, but i have that as an anchor behind all my thoughts

but it just seems like voodoo and confirmation bias

i've spent a few hours trying to find anything online that shows there's a tangible correlation in TA charting but have never found any - remember a few years ago i asked all the people sharing their charts if they could provide anything and also got crickets

i'm genuinely curious and want to learn more about it

TA kind of works when HFT bots are all trading off TA but your TA isn't as good as the HFT TA and you can't react to market conditions in milliseconds so TA is generally pointless.

But who cares, you can just claim you were right when it goes your way and ignore it and move on when it doesn't

Ah yeah, I just post what I think I see. I have no idea what will happen. If I did know it would be useful, lol.

In a way my view is biased, because I made money in the market the last few years, 2022 was awful and do not want that to happen again, lol. I was fearing the worst that year. Very glad it came back. There were a lot of naysayers back then saying the market was done. Funnily enough, it's the opposite now. Everyone is bullish. Haven't come across a single bear on CNBC.

If the market does goes up further, I don't really care at this point and if it does crash I'll come back in I guess.

Well the charts tell us we are still in an uptrend where we remain until we aren't. You are the one that said we were in a 2 year bear market when we were at all-time highs? And yesterday was a crash? I don't think you have much understanding of market terminology or honestly how to read those charts. We appear to be at the beginnings of a long overdue correction. These are normal in uptrends.

How do I not understand the charts, they say buyer beware, not go all in, lol.

always struck me as hocus pocus and hindsight bias. guess it becomes a self-fulfilling thing if enough people believe in it

that said, once worked with someone with a long track record of success in fundamental investing who i recognized as way smarter/knowledgeable than i'll ever be. they never would've tried to sell it to others or even mentioned it publicly, but they swore by charting as a way to find better entry/exit points. sadly i wasn't important enough to be privy to the secret sauce details

I think there is absolutely value in it.

It's the view of the entire market.

I read an article from 10 years ago, that one in ten trades are made using machines, I'm sure it's way more than that now, so they are just trading, the technicals.

Was it some act of god that Netflix traded from 174 exactly up to it's previous all time high of 674 and then reversed. I doubt it very much.

I would always prefer to be on the other side of the news headlines but I wouldn't not enter a trade because I agree with the a news headline.

I took my profit today and left a small runner. The VIX decayed nicely but it just wasn't the rush back in I was hoping for.

I do agree that new highs on the year will be pretty tough. The decade is not really a time frame I think on. Especially here when January 2020 feels like another lifetime ago and the end of the decade is further away than that.

The Nikkei certainly qualifies IMO as a crash. It was pretty much on the level of 1987. If anything it is that we have become use to these events that they don't seem like crashes. The high of that VIX spike was insane but maybe the close was just as insane.

I have chatGPT open in another tab but I just can't imagine we won't remember this as the LLM bubble period. That time when people lost their minds over the potential stochastic parrot uprising that takes all our jobs while we live on Worldcoin UBI or kills us. I think in a way this is a much bigger bubble than dot com because all dot com needed was T1 lines at home instead of modems.
This bubble has almost nothing to do with reality but because chip companies are highly profitable compared to unprofitable dot com companies, it has massively reinforced the bubble.

Bad Days, some context from old timers. These guys old options traders from chicago trading floor, so they have been around.

Interesting video and spot on. I traded through all those times they mentioned and because I learned the lesson they are trying to teach here I have always been a "buy the dip" when in an uptrend guy. And yeah the 08/09 GFC was the only really scary time that was a genuine bear market.

I think buying dips in uptrends is the best trading "strategy" there is. You will never really time it perfectly but for an investor you don't have to. I have always been a perma-bull because, well because look at any long term chart! I have always considered perma-bears to be mentally unstable and unable to reason correctly.

I miss Tooth perma bearing everything up

tooth was a great poster - hate him or love him, he drove good discussion

Yes and no. He did offer "some" great posts and insights. Don't you dare disagree with him though He destroyed a lot of good discussion too with his overbearingness and quest to dominate every discussion. There is the way Tooth looked at the market and if you didn't do it his way it was WRONG even though anyone with a reasonable mind knows that is wrong.

There are infinite trading vehicles and time frames and ways to approach trading and investing. I firmly believe you have to find your own niche and approach that works for you.

i'm with you - he was too much

but at the same time discussion basically dragged to a halt once he left

he also wasn't afraid of making bold predictions like negative oil which he got absolutely roasted for and then it happened

Yes. What happens with the unemployment rate is it moves up very slowly and then it spikes quickly.

When the Fed cut rates during the Dot Com Recession and Financial Crises it took about 2 years for the unemployment rate to bottom. So the cuts work with a lag, just like the hikes.

Looking at the yield curve it is about to uninvert. When that happens it signals a recession is about to start.

Yea Gundlach has been trying to hammer this point home but for some reason the average trader just doesn't really care about the bond market.
Bets on the two year a few months back were the best bets I have ever seen. If totally wrong, only make 4.7% annualized for two years with free upside. This is the first cycle I am basically a bond trader but maybe that just comes later in life and with time.



I tried to get back into chatGPT tonight. Even trying to produce javascript arrays with a random 3 letter ticker and random student T distribution of returns doesn't work.

import { studentT } from 'mathjs';

Amazing code besides for that library doesn't exist in mathjs.

We need new AI models ASAP to keep this all going.

It's been a nice little period for the people who actually save getting 5% risk free on any cash you have. Of course that finances the US debt as well, so it has a function.

It's annoying now that the Fed is going to cut rates, so a lot of that yield is going to go away, and the debt junkies who never saved a cent get another bailout.

The cuts kind of force people to be wreckless, they buy Apple which has a 0.4% dividend yield chasing any yield they can and then when it all goes south, it's Fed save me, cut fates, from the moronic decision that I just made.

Getting back to the unemployment rate. It bottomed in April 2023 at 3.4% and has creeped up to 4.2% as of August 2024.

It usually takes about 2 years from the first cut, for the unemployment rate to start coming down.

So, I would expect that unemployment will probably peak out at around 6%, meaning a shallow recession.

From April 2000 to June 2003 there was a shallow recession in the United States, where the unemployment rate went from 3.8% to 6.3%

Although that recession was shallow, it's impact on earnings for the S and P 500 were significant.

Earnings went from $51.68 a share to $38.85 a share.

Putting it all together, if we do get even a shallow recession, it will put a lot of pressure on the market, as by historical standards it is already very expensive.