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Defining GAPS

By: Marty Armstrong


Friday, January 18, 2019

What we have going on in the Dow is a classic example that the Reversal System
is great at - showing the gaps in markets. I explained that the Daily Bullish in the
Dow was at 24089 but there was a GAP up to the first Weekly at the 25004 level.
This is what happens when there are no reversals in an area going up or down. I
look for the GAPS for big moves.

This was the setup for the 1987 Crash. We elected a pair of Double Weekly
Bearish and there was a GAP with nothing between there and the next Monthly.
That GAP was filled in 2 days.

ONLY a closing today ABOVE the Weekly Bullish would indicate follow-through to
the upside. Otherwise, I would take profit against the Weekly Reversal, flip and
place the stop just about the high achieved. It either works or it fails but the risk
is low. Yes it can fail. But you do not lose the farm.

Remember that timing is the MOST IMPORTANT. We are closing in on a


Directional Change.

January21st
By: Marty Armstrong
Friday, January 18, 2019

QUESTION: Your reversals are amazing. The market fell back precisely to test the
reversal and then stormed higher. Thank God you do not do mainstream media. I
don't know how they would handle your forecasts. My question is concerning the
Monday since the markets are closed. I believe you have stated that the market
can make the move the day before or day after. Could you clarify what happens
when the ideal day for a target is closed.

Thank you for opening my eyes to the hidden order.

TKR

ANSWER: Yes, you are correct. We could peak on the close on Friday or first thing
Tuesday morning. However, the 21st is showing up in markets globally that will
be open. So whatever this is, it appears to be a confidence issue and
interestingly Prime Minister May must put forth a new BREXIT proposal by the
21st.

Gold Going into February


By: Marty Armstrong
Thursday, January 17, 2019

Gold has been starting to realign rallying with the stock market. This is a good
sign for the long-term. The Weekly Bullish stands at 1322.50 while the Weekly
Bearish lies at 1236.10 and this is a virtual Double since we have also one at
1236.30,. Technical support on a weekly closing basis rests at 1275.
Here too we have next week as a Directional Change and the strongest target
remains in mid-February. Gold is simply being driven by the political events as
are the currencies and share markets. This is reflecting that people just do not
know what lies ahead on the horizon.

On the Daily Level we have THREE Directional changes back-to-back which is


giving us this choppy pattern. But here too the main target appears to be Monday
21 with a Directional Change then and the 22nd as well.

Only a Monthly Closing above 1362.50 would signal a breakout and that does not
really appear likely until 2020.

The Euro into February


By: Marty Armstrong
Thursday, January 17, 2019
The Euro has turned down from the week of 01/07 on schedule. The Weekly
Bullish Reversal stood at 11559. The rally reached intraday 11570, but closed at
11461 leaving that Reversal in play.
This week was the Directional Change and that has unfolded as expected leaving
the high last week. The next weekly turning point will be next week. We could
see the low form then and the Dow & Euro the switch directions. Nevertheless,
the strongest turning points appear to be mid February as we see also in the
Dow.

We did elect a Minor Weekly Bearish on Friday at 11612. This leaves us focusing
on the next at 11460 which we held last week by 1 tick. Thereafter, the next one
comes into play at 11310. Since we are trading with a 113 handle, this probably
suggests that we may test the 11310 level going into Monday.

With next week as the turning point, do not expect continued follow-through just
yet beyond Monday.

The Dow into February


By: Marty Armstrong
Thursday, January 17, 2019

The Weekly Bullish in the Dow stands at 25004 in dollars. In terms of Euros, the
Weekly Bullish stands at 21448. As you can see, the Euro has been dropping once
again because of all the political chaos on the horizon. As that unfold, we end up
with a foreign bid under the market in the US that will tend to PREVENT any
major crash as domestic analysts keep screaming.
Here is the Down in terms of Euro. You can immediately see we have a
completely different pattern. The market stayed within the upward channel and
now as the Euro declines, this brings in support even if in terms of dollars the
Dow moves sideways to lower.
Now, when we turn to the Weekly Timing Array, we can see we have a Directional
Change coming into play next week followed by a Panic Cycle the the week of
the 28th. The strongest target will be mid February.
Keep in mind that TIMING is #1 and PRICE is #2. Therefore, which it remains
possible to test the Weekly Bullish Reversal in the 25,000 zone, we run out of
time by Monday 21st. That means WHATEVER high we reach on Monday will most
likely be the end of the bounce.

The market closed too far above the Daily Bullish so it moves back to retest. The
fact that the market is not running away to the upside, warns we may not be able
to reach the 25,000 area by Monday. We do have a Daily Bullish at 24952. There
just appears to be a large gap between the 24,000 and 25,000 levels.

Normally, with the Weekly Bullish not coming into play until 25,000 when the
market fell to 21,712, This setup also warns that we may yet make a new low but
hold 21,600 on a monthly closing basis. That would then bring the Weekly Bullish
down significantly closer to the current trading levels. When that happens, it will
increase the chances that the low for the year is in place.

Something needs to happen between now and January 2020 that begins to
seriously undermine the confidence in government. The Democrats are acting
absurd. If Trump says the sky is blue they would say it is black. They must
oppose whatever Trump says just to win the White House in 2020.
Government will no longer function. The damage the Democrats are doing on all
levels being aided by the Neocons who just want war and are not loyal
Republicans, is really profound. From here into 2032, do not expect government
to function. It has become permanently polarized. This is NECESSARY to aid the
shift from Public to Private Confidence going into 2032. The Republicans and
Democrats can no longer work together to run government. God help us for
whoever follows Trump will be a full fledged pro-government person who will do
whatever is necessary against the people. Trump is ONLY the reaction - not a
change in trend. Those who hate Trump hate anyone who disagrees with their
politics. This hatred is pervasive. In South Carolina, a friend reported that a car
in a parking lot with a Trump sticker was shot numerous times as a warning to
Trump supporters. The 2020 election is likely to be the most violent in American
history. This is all part of the collapse in faith in government unfolding into 2032.

There is just nobody willing to run for office who is now middle of the road. All
we will get are extremely from both sides.

The Dow into Week of 1/21


By: Marty Armstrong
Wednesday, January 16, 2019

The Dow is pushing higher to test the key resistance area in the 25000 zone both
technically and on our Reversals system. The key day for a target will be Monday
21st. The following week of the 28th remains as a Panic Cycle. We still see a
closing above 24089 should point to the test of the 25000 area. There will still be
the risk of a retest of the lows after the 21st.
Keep in mind that we nearly reached the Monthly Bearish which was the ideal
target at 21600 stopping at 21712. That means we could still make a new low, but
the bulk of the decline is normally confined to the first two time intervals which
was therefore December. Only a monthly closing BELOW 21600 would signal a
more pronounced decline. This is all a setup for what will be the Greatest Trade
of most people's lives.

Support right now lies at 23775 on a closing basis.

The Great Alignment


By: Marty Armstrong
Thursday, January 10, 2019
QUESTION:

Thanks for your reply.

Am I correct in observing many assets are deflating in value, not inflating


anyway, and that eventually the DOW, gold and (USD if not monetary change) will
eventually reflate very strongly?

Also, is it possible that commodities will come back at the same time as the
DOW, gold ? How do they relate to each other?

It would seem that the time targets may be pushed back to 2032, so when would
the deflation cease?

Have been to 2 conferences, read your reports. It seems I might have to reset my
timelines.

Regards RM
ANSWER: Yes, we are still in the Asset Deflationary Mode. However, the ECM
turns up in January 2020 so the next cycle is upon us soon. I warned at the WEC
that we would make a correction in the Dow given it was an reasonable high on
average of 8.6 years from the 2009 low. But it was also 86 years from the 1932
low. The correction appears to be setting the stage for the realignment where
assets will rally and we should then see commodities, including gold, rally with
the share market as was the case between 1976 and 1980.

Keep in mind that the Great Alignment is the shift from Public to Private Assets.
This is when people begin to lose confidence in government. In Europe, we have
rising discontent by not just the Yellow Vests, but strategic alignments between
Italy and Poland to which we may yet see Hungary join. In the USA, the battle
against Trump and the mainstream media even opening calling him an idiot does
not speak well for firming up confidence in government. This war against Trump
is undermining the confidence completely in government as a whole. The
Democrats are out for blood and just want to win in 2020 ignoring what they are
doing to nation. It no longer matters what a politician says they stand for. Both
parties are told to vote party lines.
So this is part of the Great Alignment. The next ECM Wave should be an
inflationary wave. We we have about 1 year for this to unfold.

The Euro
By: Marty Armstrong
Thursday, January 10, 2019
The Euro has been treading water since the low made the week of 11/12.
December turned out to be an inside trading month and the array on the monthly
level pushed off into January since it was straddling the week of 12/31. We have
a Weekly Bullish at 11550 which the market is testing. For whatever reason, it
seems to be the latter part of January that is the key period. If we were to elect
the Weekly Bullish in the Euro, we might see still a corresponding dip in the Dow.
The weeks seem to be the same as targets. The Directional Change comes into
play next week and we see the volatility rising the week of 01/28 into February
with the key week becoming 02/11.

There has really been nothing to write home about, just consolidation.The Euro
bottomed in August and then rallied into a September high. That reached the
11815 level the week of 09/24 and then elected 3 Weekly Bearish Reversals
taking the market down into the week of November 11/12. December was
appearing as a critical month which has migrated into January. However, that
was not destined to be a major high or low. Nor is January 2019. Yet, January
could form an important turning point here in 2019 for we have BREXIT and the
May elections while Italy & Poland are forming an alliance being an anti-EU
faction. This is clearly instigated by the Refugee Crisis that both never agreed to
in the first place.
The Euro is testing the first Weekly Bullish at 11550 and if that is elected,
then the next comes into play at 11615 level followed by the 11745 zone. We
warned back in the post of 10/15 that the Euro "has been unable to exceed even
the breakout line and it has fallen back within the previous Downtrend Channel.
This is technically a weak posture and resistance is forming at 11583 level and
the Euro must rally back above this level to see a bounce back to the 119-120
zone. However, that requires a restoration of confidence in Europe which is also
difficult to find." With the November low, the Bullish Reversals came down and
are more formidable now under the 119 level.

Back on 12/21, we wrote "This week was also a Directional Change for the Euro
as well. The main turning point is the week of 12/31 and then look at January into
February - rising volatility. ... So hang tight. Everything is unfolding in line with
the cycles rather nicely."

So there is obviously nothing fantastic here. January can still unfold as a 2


month reactionary high from the November low. The major crack in the Euro is
not due just yet. 2016 was the lowest Yearly Closing, 2017 was an outside
reversal to the upside so the intraday low was in '17, and then '18 was the 2-year
reactionary high reaching 12555 but then crashed and closed lower finishing at
11459 electing a Yearly Bearish (MINOR) at 11640, which is not out of the
question for a retest. We have system resistance at 11620. If the Euro can exceed
that level, then such a rally is IMPRESSIVE warning that there can be a delay for
the low pushed off into 2021 which will be a 13-year decline.

Therefore, watch the 11620-11640 area for overhead resistance. The major
support is still at the 11300 area.

Dow Clarification
By: Marty Armstrong
Wednesday, January 9, 2019
Some people seem to be confused. What I am saying is the Directional Change on
the Weekly level implies the low for the 26th and that cannot be a low without a
bounce. January is also a Monthly Directional Change. Therefore, we have the
distinct potential to just consolidate and hold off any new low until May. To do
that would REQUIRE a closing above the Daily Reversals.
Now, the next turning point is the week of 01/21 and notice the Panic Cycle due
the week of 01/28. That means, if we rally into the week of 01/21 and we CANNOT
achieve a Weekly Closing Above 25005, then we must respect the fact that we
could still make a January low the week of 01/28 completing a 3 month reaction
from the October high. A 5 month decline would bring us into March. The first
Daily Bullish Reversal stand at The Daily Bullish Reversals are 24058 and 24089.
followed by 25100. Therefore, we can take out the first two and then bounce off
the 25000 zone since that is where the Weekly begins and the third Daily Bullish.

There is no indication that we are in a major bear market. Nor are we ready to
breakout to the upside just yet.

The Dow Bounce into Early 2019


By: Marty Armstrong
Wednesday, January 9, 2019
We can see that after we achieved the low on the 26th, the next week was the
Directional Change and that should have given us a bounce, but not a change in
trend, The next Directional Change was due the week if 01/21 so consolidation
until then is possible. We have another Panic Cycle the week of 01/28.
The top line has now moved to agree with the Directional Change the week of
01/21. The volatility models are also picking up now for the week of 01/28 and
this is followed by back-to-back Directional Changes in early Feb. Keep in mind
that the major thrust in a correction is ALWAYS in the initial stage. Therefore,
which we can still see a lower low, it is unlikely to be a major thrust down a
second time.
The bounce after the first 1929 Panic low lasted 22 weeks. The Weekly Bullish
Reversal stood at 329 but the rally only reached 29720. However, the Breakline
was retested and exceeded slightly intraday but not on a closing basis.
Here the Breakline from the first high in 2018 rested at 22430.17. The market
penetrated it intraday but could not close below it. This technical pattern also
tends to confirm we do not have a major change in trend for here the market is
testing the Breakline from above compared to below in a bounce following the
1929 Crash. Here the first Weekly Bullish stands at 25005.

January was also a Directional Change on the monthly level also confirming a
bounce with the next two targets being March and May. We still could make a
January low later in the month and then rally into March. So look at the week of
01/28. If the market continues to consolidate into March, then this type or
pattern would imply perhaps the final low in May with the reversal in trend at
that time. This would also line up with the EU election cycle. The low on the 26th
was 21712 and our primary target remains 21600, which is the Monthly Bearish
we stated we should test at the WEC. Therefore, a rally even up to 25000 which
fails to elect any Weekly Bullish, could still be followed by a lower low, but one
that then holds the 21600 level on a closing basis.

Don't for get we have BREXIT in March and the the EU elections in May. The
model is picking up both periods suggesting they may indeed be influential.
Where are we WRONG on the scope? That seems to be a Weekly closing above
25005