Nasdaq Futures - Are You Prepared For Red September?
Updated
The last ten days of price action produced a retrace of significant magnitude that was very kind to institutional friends who were net long from early June.
That is to say, what has transpired since all three indexes took their January of 22 failure pivot levels in early July has been more consistent with an optimal short entry combining with a bull trap, combining with a chance for big players who were either still full long or partially long to mitigate their losses and exit their positions.
But retail, especially those who foolishly follow the messages emitted on social media, regard price action as "confirmation" that we're on our way to a new bull market.
The macro economic situation is that the Federal Reserve has reiterated that while it may slow the pace of hikes going forward, depending on economic data, there is no intention whatsoever to pivot.
When you consider the above in light of monthly candles trading so far above their long-term trendline, big big danger flags should be going off in your head.
The reason is that Fed rates connect to bond yields. Bonds also have a feature where as they pay more interest the price also goes down, way down.
What this means is that there's huge alpha to generate for big funds and big banks who trade very long time frames in selling equities at a high price, buying bonds at high yields and low prices, and sitting on that position instead of taking risks on commodities and equities while the world is in a really bad situation.
Weekly candles show us more clearly that significant areas of concern that should be retraced to before any further upside is rationally thought to be on deck were not achieved before the bounce.
A big problem facing the markets at present is the existence of the Q3 "JPM Collar," which I discuss here:
SPX/ES - An Analysis Of The 'JPM Collar'
It's worth noting that JPM, which sold calls with a strike of 4,665 at the end of July, has not been in the red on that portion of their position yet, although whoever bought them has certainly made money since price approached 4,665 very quickly after purchase.
The bigger component of their trade is that the most significant bank on this planet is long 15,800 puts with a strike of 4,225 that have never been in the money since they were purchased.
Expiry date is September 29.
Because of time decay, for JPM to break even on that portion of its position, we would need prices approach 4,000 and the VIX to push over 20 to pump implied volatility premium, and all in only a few weeks.
And although this is a Nasdaq call, one index fuels all three indexes.
A problem with thinking the indexes have bottomed is that while the Nasdaq may have rebalanced a gap before the pump, the SPX did not:
And even less did the Dow, which has traded like a heavy bag of rocks despite having the strongest recovery from last October's dump of any of the three indexes.
The algos have a habit of making all three indexes do the same thing before the page really turns.
You're also dealing with a worldwide economic and geopolitical situation where everything is heavily balanced by a horsehair.
And that horsehair is the Chinese Communist Party, which looks like it will take Xi Jinping to its grave with it.
The CCP is about to collapse, and it will happen overnight, in the middle of the night, and there will be a lot of gap downs.
The reason the market is still trading in a structured way is simply because the U.S. Empire and the globalist faction, which wants to install the CCP's Zero-COVID Social Credit system worldwide, ramble on about "War With Taiwan" all the time because the intention is to take control of China when the CCP falls using a Taiwan-based proxy.
"But the best laid plans of mice and men often go awry."
The problem for all of humanity is the 24-year persecution of Falun Dafa's 100 million spiritual practitioners by the CCP and former Chairman Jiang Zemin starting July 20, 1999.
Organ harvesting, rape, murder, and things worse than organ harvesting have never been beneath the CCP, and unfortunately, the rest of the world who has been funneling blood to the Party all these years to keep it afloat so it can keep on lying to the world.
And so what I can tell is arranged is that we dump hard into the end of Q3, and then it seems to me that we rally in Q4, probably back towards the index highs, with all of 2024 being an economic nightmare.
Donald Trump looks like he's going to prison and won't be able to save you. Not that Donald Trump is capable of saving anyone, lol.
So Biden will win by default because nobody is going to vote for DeSantis or Vivek, and the socialist spending schemes and the crashing of the world economy is arranged.
But because the CCP is on the brink of falling and China is not a country that any outside forces have ever been able to capture in its 5,000 year history, perhaps before the year is out we will see the rally truncated sharply.
"Watch Out For Fire."
The call:
Short Nasdaq now anticipating a ruthlessly bloody September, close under 14,000.
Go long under 14,000. Close when you have a lot of profits and cash out.
Brokerages aren't going to be processing withdrawals anymore than Binance is right now when the CCP collapses.
Everyone will be trying to run for their lives. It's very dangerous. Nobody should have supported Marxist-Leninism, the CCP, and the persecution of Falun Gong's true cultivators.
But they did. And the consequences are not something people can bear.
That is to say, what has transpired since all three indexes took their January of 22 failure pivot levels in early July has been more consistent with an optimal short entry combining with a bull trap, combining with a chance for big players who were either still full long or partially long to mitigate their losses and exit their positions.
But retail, especially those who foolishly follow the messages emitted on social media, regard price action as "confirmation" that we're on our way to a new bull market.
The macro economic situation is that the Federal Reserve has reiterated that while it may slow the pace of hikes going forward, depending on economic data, there is no intention whatsoever to pivot.
When you consider the above in light of monthly candles trading so far above their long-term trendline, big big danger flags should be going off in your head.
The reason is that Fed rates connect to bond yields. Bonds also have a feature where as they pay more interest the price also goes down, way down.
What this means is that there's huge alpha to generate for big funds and big banks who trade very long time frames in selling equities at a high price, buying bonds at high yields and low prices, and sitting on that position instead of taking risks on commodities and equities while the world is in a really bad situation.
Weekly candles show us more clearly that significant areas of concern that should be retraced to before any further upside is rationally thought to be on deck were not achieved before the bounce.
A big problem facing the markets at present is the existence of the Q3 "JPM Collar," which I discuss here:
SPX/ES - An Analysis Of The 'JPM Collar'
It's worth noting that JPM, which sold calls with a strike of 4,665 at the end of July, has not been in the red on that portion of their position yet, although whoever bought them has certainly made money since price approached 4,665 very quickly after purchase.
The bigger component of their trade is that the most significant bank on this planet is long 15,800 puts with a strike of 4,225 that have never been in the money since they were purchased.
Expiry date is September 29.
Because of time decay, for JPM to break even on that portion of its position, we would need prices approach 4,000 and the VIX to push over 20 to pump implied volatility premium, and all in only a few weeks.
And although this is a Nasdaq call, one index fuels all three indexes.
A problem with thinking the indexes have bottomed is that while the Nasdaq may have rebalanced a gap before the pump, the SPX did not:
And even less did the Dow, which has traded like a heavy bag of rocks despite having the strongest recovery from last October's dump of any of the three indexes.
The algos have a habit of making all three indexes do the same thing before the page really turns.
You're also dealing with a worldwide economic and geopolitical situation where everything is heavily balanced by a horsehair.
And that horsehair is the Chinese Communist Party, which looks like it will take Xi Jinping to its grave with it.
The CCP is about to collapse, and it will happen overnight, in the middle of the night, and there will be a lot of gap downs.
The reason the market is still trading in a structured way is simply because the U.S. Empire and the globalist faction, which wants to install the CCP's Zero-COVID Social Credit system worldwide, ramble on about "War With Taiwan" all the time because the intention is to take control of China when the CCP falls using a Taiwan-based proxy.
"But the best laid plans of mice and men often go awry."
The problem for all of humanity is the 24-year persecution of Falun Dafa's 100 million spiritual practitioners by the CCP and former Chairman Jiang Zemin starting July 20, 1999.
Organ harvesting, rape, murder, and things worse than organ harvesting have never been beneath the CCP, and unfortunately, the rest of the world who has been funneling blood to the Party all these years to keep it afloat so it can keep on lying to the world.
And so what I can tell is arranged is that we dump hard into the end of Q3, and then it seems to me that we rally in Q4, probably back towards the index highs, with all of 2024 being an economic nightmare.
Donald Trump looks like he's going to prison and won't be able to save you. Not that Donald Trump is capable of saving anyone, lol.
So Biden will win by default because nobody is going to vote for DeSantis or Vivek, and the socialist spending schemes and the crashing of the world economy is arranged.
But because the CCP is on the brink of falling and China is not a country that any outside forces have ever been able to capture in its 5,000 year history, perhaps before the year is out we will see the rally truncated sharply.
"Watch Out For Fire."
The call:
Short Nasdaq now anticipating a ruthlessly bloody September, close under 14,000.
Go long under 14,000. Close when you have a lot of profits and cash out.
Brokerages aren't going to be processing withdrawals anymore than Binance is right now when the CCP collapses.
Everyone will be trying to run for their lives. It's very dangerous. Nobody should have supported Marxist-Leninism, the CCP, and the persecution of Falun Gong's true cultivators.
But they did. And the consequences are not something people can bear.
Note
All three indexes indicate to us that sell-side targets are being taken.However, the market makers can be exceptionally annoying about how they go about this, driving it back to the local highs or even above the local highs into week end, considering it's a short week and there are no ostensible news drivers.
What we see is a divergence between ES SPX Futes and NQ Nasdaq Futes.
The fact that SPX did not maintain its gap median indicates to us that the long term target is likely below the lows.
Which means any kind of retrace is a time to look for shorts and not a time to buy the peaks.
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