Archives 2023

One Last Thin Mint?

Comparing Peaks

Good Morning:

— I have always been a Monty Python fan. And I recall the scene where the fat guy gorges a table full of food, asks for one more thin mint, then blows up. 

— And that reminds me as to where the S&P 500 Index finds itself at the moment. It has had a great run from the correction low.

— The Magnificent 7 Generals led the charge, and the Soldiers now need to follow. And we have seen some positive rotation lately.

— Otherwise, the bulls will have to pass the football, and that could get unpleasant with the weak structure (open gaps and VPOCs) all the way down to the October lows.

— In that vein, we reduced our equity exposure in both the Daily and Hourly Strategies from 50% to 25% at 4655.50 on the March 2024 Futures Contract this morning.

— Recall that we had previously reduced our exposure from 100% to 50% at 4645 at the end of November.

— The price action here looks eerily like the price action around the July peak.

— Prices need a rest, and while the consolidation in early December is helpful, it may not be enough to entice further buying without a meaningful pullback.

— Far be it from me to tell the market what to do, and the possibility of one more thrust higher to the 4734.50 summer peak remains on the table. But a pullback of at least 25% of the rally may be required to refuel the tank.

— We have monthly options expiration and the December Fed meeting next week. I don’t think there will be any surprises, and the market has already incorporated good news.

— So I am looking at this fabulous run as a “buy the rumor – sell the news” rally. The news is the Fed decision next week – likely to be the usual vague reference to incoming future data.

— Incidentally, these are some of the longest swing signals we have held lately. But all good things must come to an end.

Have a great weekend and stay tuned.

A.F. Thornton

How Much Fuel is Left in the Tank?

Good Morning:

— We remain long in the Hourly and Daily Strategies, with about half of our positions left. Sustained price action a few ticks below the five-day line is our stop. It is a judgment call when to take the stop as the price can dip below the line on a stop raid and finish above it. But always remember that pigs get fat and hogs get slaughtered.

— The market is tiring, and momentum is waning. Volume has not supported the rally. The price is on thin ice. The next turn date is Wednesday. How much higher can the market go?

— At the end of the day, Markets seek liquidity or rest. Liquidity is market fuel and transaction business for Dealers/Market Makers. They will move the market to high transaction levels to get the business, usually where most buy and sell stops gather.

— For the S&P 500, 4600 is the next filling station. We are too close to that level for Dealers to ignore it. They will try to drive prices there before a meaningful pullback. 

— Note that the NASDAQ typically leads and has already conquered the equivalent level on its chart.

— The 4600 area also challenges the bear market down trendline, connecting the 2022 top and the recent July 27th peak. (See chart above).

— I will leave it for a future discussion, but the underlying rally structure is very weak. We may need a parachute when the market does tip over. There are six unprecedented unfilled gaps and nearly as many open VPOCs.

Stay Tuned,

A.F. Thornton

Volatility is Here to Stay

Good Morning:

— If such a thing as “resistance” still exists, the S&P 500 and the NASDAQ 100 have reached the pinnacle. The S&P 500 has a little headroom left up to 4600.

— We remain long in our Daily and Hourly Strategies but have scaled down to about half a full position over the past few sessions.

— The current rally is stunning, and the volatility (the mega rips up and down) appears to be a permanent guest.

— On one hand, it reminds me of the period leading up to the 2000 top (Dot Com Bubble). You can see the choppy top in the chart of the Dow Industrials below.

— Back then, we would have a stellar month, followed by retracing most of the gain the next month, and so on.

— Recently, however, the reasons for the exaggerated moves appear less related to the economy or company earnings per se.

— Of late, these moves are technically driven. In particular, new derivatives are adding to market volatility. The derivatives market (options and futures) is rapidly approaching One Quadrillion Dollars. Yes, folks, that is One Thousand Billion dollars!

— In particular, the options market has become the proverbial tail that wags the market instead of the reverse.

— Rallies start with the usual short-covering but then move into self-reinforcing boom and doom loops due to “Gamma Squeezes” in the options market. “Gamma Squeeze” was an esoteric term back in the day.

— The introduction of daily options (so-called zero-day to expiration) over the past year has resulted in a parasitic exaggeration of the indices that never existed before.

— Due to these Gamma Squeezes, the sudden rips up and down will continue as long as daily options exist.

— This volatility can be an advantage to traders once we accept it as the permanent reality.

— Unsurprisingly, then. the darker side of this latest rally will return soon.

— And in the current situation, the underlying market structure is weak due to the quick rip and six unfilled gaps.

— Also, the volume has diminished daily with this recent impulse wave. It is also below average, making me question the current move’s sustainability and whether the rally will be retraced. Even a half retracement could be fast and unpleasant. And “overbought” does not begin to describe current conditions. We are up 15 days without tagging the mean.

— Upcoming Fed minutes, something on the global front, or even the wrong move by the Orwell Administration could be the next catalyst.

— And someday, we will witness an epic meltdown as the counterparties fail to meet their obligations on many of these instruments.

— I’ll do my best to help you navigate these waters, but keep your seat belt on.

— I doubt I will publish anything before the holiday, so enjoy Thanksgiving and we will be back next week.

A.F. Thornton

One More Thrust?

Good Morning:

— We are still in an uninterrupted buy signal from earlier this month. And another thrust higher into the red zone on the chart above is likely before we get a meaningful retracement. But recognize that we are in the nosebleed seats. The risk/reward ratio is heavily skewed toward risk, short-term.

— The problem is that short-sellers remain aggressive, but they contribute to their losses when the market fails to cooperate, forcing these traders to buy to cover their positions. It is a doom loop from their perspective. For now, we call “higher” the “pain trade.”

— The options market has been less than accurate lately but forecasts a 64-point range today (+-32 points from Friday’s close). The forecast for this week is 108 points (+-54 points from Friday’s close.

— Key levels and ranges are marked on the chart above.

— Year-to-date results have been excellent for subscribers to the room and our flagship, M-Squares Daily Strategy.

— On the zippy side of the scale, an account with a starting balance of $50,000 timely trading one Emini futures contract on the signals achieved a 174% return through Friday’s close.

— Slowing down the leverage, SPY options, or the Cash SPY reduces the return but still handily beats the market. 

— So what about the bear case?

— Let’s just say that the bears are hanging by a thread, as you can see from the chart above. Nobody can call an all clear unless or until the all-time high in January 2022 is beaten.

— How about the bull case?

— For now, it’s fair to say that the Bulls have the football. I tend to favor the bull argument but always keep an open mind.

— Even in the bull case, remember that the price will need to reach down for fuel occasionally. This could result in retracements of 24% to 50%.

— The M-Squares signals will guide us.

A.F. Thornton

A New Adventure

Greetings Everyone:

I hope you are doing well. I am wrapping up my sabbatical and look forward to returning to these pages. As we navigate the unpredictable waters of the financial world and I try to bring some balance to my life, I wanted to share a personal endeavor that brings me immense joy and serenity outside the trading floor.

My wife and I have recently embarked on a meaningful journey by establishing a 501(c)(3) sanctuary dedicated to the rescue and well-being of donkeys and horses. This venture is born out of our deep love and appreciation for these incredible creatures, and we believe in the profound positive impact they can have on our lives.

Our sanctuary is not just a haven for donkeys; it’s a sanctuary of the heart. Spending time with these gentle beings has proven to be a source of solace and balance in my life as a trader. Their quiet strength and unspoken wisdom serve as a grounding force, offering a welcomed respite from the demands of the financial world.

We want to share our passion for this cause with you, our valued clients. By fostering a connection with these remarkable animals, we can create a ripple effect of compassion and well-being in our lives and, hopefully, in those we touch.

You can meet the donkeys at our new website (https://www.WesternSpirtSanctuary.org).

Thank you for allowing us to share this personal and meaningful aspect of our lives. Please don’t hesitate to reach out if you have any questions or want to learn more about our sanctuary. Your continued support means the world to us.

I wish you success and tranquility in all your endeavors.

Warm regards,

A.F. Thornton and Erasmia Spyros

He’s Back – A Light in the Darkness

I have been on Sabbatical since May, as it were. The time passes quickly. And as I complete one last road trip, I thought I might return to these pages with the usual market analysis and a touch of wisdom. Writing is a lot of work, but I have missed it. It is cathartic in some way.

Since wisdom is in shorter supply these days than opinions about the financial markets, let’s welcome my return to these pages with some thoughts from Kunstler. Sometimes, you run into someone who can express your thoughts better than you. Rush Limbaugh was the first person I encountered who did this for me in the late 1990s. I still miss him. But Kunstler will give anyone a run for their money. He has the gift of gab to go along with his wisdom. Here goes it on his latest musings. It is exactly what I am thinking about our current situation – encapsulated:

The sun is low on the horizon all day long now, and darkness creeps in like a home invasion of your mind. Demons descend through a red and black sky and no help is on the way. Our country is so mentally hog-tied trying to unravel the twisted events of just a few years past that it has no mojo left for rationally anticipating the events of just a few years ahead. Have you ever felt more alone?

       This is the end-process that we’ve been softened up for: the inability to think and plan. The gigantic “intel community” evolved from something intended to act as sensitized antennae for detecting threats against our republic into what is now a remorseless mind-fucking operation against our republic. That word, by the way, derives from the Latin res publica: the public thing, a society that literally belongs to the people, who decide its affairs. Now, so much is mysteriously decided for us, and not in any good way.

      It’s no wonder more than half the country can’t think straight, and it’s a whopping irony that this group comprises most of our country’s thinking class —the bureaucratic managers, the professors, the curators, the editors, the reporters lost in mis-reporting. This group used to play a critical role in the res publica: to earnestly determine what is true and what is real, and to present us with a way of understanding all that so we can think and plan. They appear to be captured by malign forces. The scribes are hard at work defending every act of official malice. The dishonesty at work is epic. You need a decoder ring to keep your mind right.

      You are probably desperate to understand why this is happening — how, for instance, a blatantly corrupt and ignorant attorney general in New York state can get away with bringing a politically-motivated nonsense case against the leading presidential candidate in a courtroom ruled by a judge who acts like a jester in a Shakespeare play. New York AG Letitia James gets away with it because the flagship organ of the thinking class, The New York Times, is in on the gambit. But why?

     We struggle to sort this out. One explanation is that the Chinese Communist Party (CCP) has infiltrated the management of our country at every level so as to eventually conquer our territory for its resources while eliminating or enslaving the population. Surely, the CCP has made significant inroads, starting with the successful bribery and compromise of “Joe Biden,” probably other elected officials, too, in placing many CCP agents in the vast array of university research departments, NGOs, PACs, and lobbying gangs, and extending to the purchase of vital businesses and farmland to prepare the gameboard for eventual takeover. My opinion is they’ve accomplished a good bit of this, but it’s not the answer you’re seeking.

      Another popular idea out there is that a sinister cartel or cabal composed of the World Economic Forum, the WHO, the EU, and a claque of super-rich megalomaniacs (e.g., Bill Gates, George Soros, Mark Zuckerberg) trying to usher in the so-called “transhumanist” next chapter of human history. This scheme is so full of preposterous contradictions that it remains hard to take seriously. The main one is that their engineered collapse of techno-industrial civilization would destroy the very network of complex systems that might support their supposed cyborg nirvana, especially a reliable electric grid. Secondarily, collapse would result not in centralizing power but just the opposite, re-localizing power away from the center, negating the possibility of global rule.

      A third theory is that the USA has somehow gone “communist.” The universities have, for sure, but in a most half-assed way imaginable that presents more as a case of collective mental illness than a true political ideology. Higher education has lately enjoyed stupendous subsidies and revenues that funnel down to the miserable cat-ladies who have taken over the faculty department chairs, plus the deans and president’s offices. The Niagara of grants and lavish salaries has funded the dissemination of incoherent cat-lady ideas, such as the foundational notion that all men are hopelessly defective except the ones who pretend to be women or vice-versa. Such postulations lead to ridiculous actions like the drag queen story hour, or men competing in women’s swim competitions. These actions-and-effects are “communistic” only insofar as they induce some Marxist-Gramscian overthrow of normality (i.e., a coherent cultural consensus) in order to usher in the utopia of perfect social equity, where nobody is allowed to do better than anybody else — that is, a society of cat-ladies (plus men pretending to be cat-ladies), all equally miserable.

     Are the editors and reporters of The New York Times all bought off by the CCP, Soros, Gates? I doubt it. That’s not what’s going on here. And the same goes for the Intel Community, much of the rest of the executive branch of the US government, the various “blue” state and blue city governments, and the great social media companies. Are all the employees of these vast bureaucracies dedicated communists?  Bwa-ha-ha-ha-ha-ha….

     What’s going on is that all these players are now desperate to evade the blame for and consequences of their many crimes. Hundreds of top bureaucrats and elected officials will be liable for prosecution for monstrous acts of perfidy and treason against our republic and its citizens. The New York Times and other compliant news outlets that lied about everything from Russian collusion to election fraud to the safety of Covid-19 vaccines to protect their fumbling allies in power are desperate to save their reputations — though that will be impossible as the truth eventually unfolds, and it will. Their knowing lies did real and lasting harm to the public thing.

     Take heart in these darkening days. The light will not be extinguished. It will return, as everything does in this universe of endless cycles. A nation turned upside down will find its feet again. The wicked will answer. The counter-revolution has begun. You are not alone.

Kunstler (Kunstler.com)

Remember when I told you about the “Fourth Turning” only a few short years ago? Even knowing it was coming and fully preparing for it, I still underestimated what it would be like to live through it. How do you like it so far? 

Then there was that 80-year War Cycle thing. Do you believe me now?

The good news is that all cycles have an implicit end.  Cycle trough to cycle trough. And there will be an end to this series of cycles, too. And more likely, due to the wisdom of non-Western leaders worldwide, we hope to make it with our cajones intact.

I am back, though I cannot promise daily musings…

A.F. Thornton

P.S. Next up, my latest stock market Magnum Opus

Feast or Famine and More Webinars

Hello Everyone:

Million Dollar Squares Trading System “M-Squares” Webinar

I am pleased (but a little embarrassed) that we had more people than anticipated attending the first M-Squares introductory webinar last week. I expected a smaller group and had not reserved a large enough online room.

We have scheduled two more live webinars, one this Tuesday and one this Thursday. Both will be held at 7:00 pm Central Time. We upped the room size so there should be nobody turned away.

Another invitation will follow tomorrow, and we will reserve a spot for you upon request, though reservations should not be necessary.

The Stock Market

S&P 500 Index -Gann Master Cycle
S&P 500 Index -Gann Master Cycle - Source @Fiorente2.substack.com

When I published our 2023 forecast (see above) after last Christmas, even my partner and family thought I was nuts! Wars, inflation, rising interest rates – the world was supposed to come to an end, right? How could I possibly forecast a market rising at warp speed for 2023 all the way back in November? And look how the blue line (actual market this year) has tracked the magenta line (forecast turns).

It is not unlike the message I conveyed about the Fourth Turning several years ago. The Fourth Turning is an 80-year Socioeconomic cycle of repetition. Everyone thought I was crazy then too. Now, we are in it, and it is worse than I warned.

Well, the stock market has its own cycles of repetition too, the two most important of which are the 20 and 60-year cycles.

Now, I am painting with a very broad brush here, so put your excel spreadsheets away. The devil is in the details. But suffice it to say that the master cycle above is mostly the result of compressing the data from 1963 (60-years ago) and 2003 (20-years ago), then weighting and fitting it to the current calendar to forecast the turns. W.D. Gann did the same thing in 1928 and predicted the 1929 stock market crash with stunning accuracy.

November 1928 Gann Forecast for 1929 Stock Market Crash

Except on those rare occasions when cycles invert, this compression forecast is a good guide to the turns in the year ahead, as you have witnessed.

The forecast correlation has been running at 85% or greater except briefly during the Silicon Valley Bank disaster. The cycle dropped slightly below 80% then, which is the threshold for dropping the cycle and finding a different harmonic per the @Fiorente methodology. News will dislodge all cycles from time to time, but the train usually gets right back on the track as it did after the bank shock subsided.

And think back 60-years ago. The Cuban Missile Crisis? The Pentagon announced yesterday that China has been building a military base in Cuba (likey with nuclear missiles). China has now confirmed it (all but the missiles). A Kennedy running for President? President Abe assassinated in Japan? Nuclear War with Russia on the table again? Synchronicity? The Matrix?

All we know is that we are having our best year since I went public with this site in 2020. Depending on how one uses our signals – they are already approaching four digit returns for the year and nobody is having trouble beating the market.

 Of course, we operate mostly private now from our trading room, as it keeps away the prying eyes of competitors. And I have been sequestered for a few months working on the M-Square algorithms and webinars. Always remember that there is a complimentary seven-day trial any time you would like to try the room.

Vortexes and the Coming Correction

The Golden Ratio - The Base Math for the M-Squares and nearly every growth cycle in financial instruments.
The Golden Ratio - The Base Math for the M-Squares and nearly every growth cycle in financial instruments.

 The market is overbought and the master cycle says we are getting close to a correction. And seasonally the market normally dips from mid-June to August before the summer rally presents. Then the market tilts south again into October. Still, have the emotions of the crowd put us in a parabolic Fibonacci spiral? It would seem so.

The S&P 500 and NASDAQ 100 are in parabolic melt-ups at the moment, because money managers are panic buying at the risk of getting fired at quarter-end.

We call it FOMO – Fear of Missing Out. And their fear is well-placed. Most of them bought/buy the gloom and doom stock market narrative and find themselves on the wrong side of the market. And who knows how much higher the market can climb before it sucks these managers (and retail investors) into an intermediate top – then dumps them. Even now, the indices can go higher than we think with this buying panic. Feast or famine – never stand in front of a freight train.

S&P 500 Index - Fibonacci Cycles - Source @Fiorente2substack.com
S&P 500 Index - Fibonacci Cycles - Source @Fiorente2substack.com

The market could very well be in a foldback, meaning that the climb back up to the old highs will be the mirror image of the bear market from January 2021 until October 2022 low.

But in the very short term, the market is overbought. The master cycle says we are getting close to a correction. And seasonally the market normally dips from mid-June to August before the summer rally presents. Then the market tilts south again into October.

☽ The S&P 500 and NASDAQ 100 are in parabolic melt-ups at the moment, because money managers are at risk of getting fired at quarter-end.

We call it FOMO – Fear of Missing Out. And Wall Street’s fear is well-placed. Most of them bought/buy the gloom and doom narrative and find themselves on the wrong side of the market. It is a brutal business and clients are fickle, always looking for a prettier face. And then there are the money managers who have been short. They have a lot of ‘splainin to do.

And who knows how much higher the market can climb in a melt-up before it sucks these managers (and retail investors) in – and then mercilessly dumps them all? Feast or famine – never stand in front of a freight train…

But there is hope for the bears. The chart above shows a convergence of Fibonacci cycles around June 15th. And there are more Vortexes to reverse the market around mid-June than I could possibly list here. But it could still be rough for the bears for the next few sessions. The early week inflation report, the Fed, or quadruple witching options expiration could end (or extend) the party.

This would not be the first time that the bulls got sucked into the initial wave rally after a bear, only to see a “C” wave down that is equal to the decline from January 2021-October 2022. It happens – think 1932.

Also recall that the Fed currently abhors a strong stock market because the wealth effect supposedly counters their fight against the inflation they caused. But lately, the wealth effect is so narrow that I could see the Fed going with the program to line the pockets of their elite friends. 

But to be fair, the crowd found itself rallying into the gate of several other potential Fed “pauses,” only to be disappointed. Even if the Fed does pause, isn’t it a “buy the rumor,” “sell the news” moment? The market typically recovers as the “Recession” arrives because it looks ahead. We already had the bear market that predicted a contraction. The pundits get it wrong because memories fade and bear markets do not occur frequently in time.

At the end of the day, it is all math. Most stocks and indexes trade in base ten mathematics. And now they are traded by computers running on “1s” and “0s,” soon to be Qubits. And then there is the alchemy of the crowd, creating natural and recursive cycles. The markets and stocks move to their own, unique DNA based on their history. But they are subject to the rules of three and fourth dimensional math, just like everything else in nature.

And what I will be teaching is how to use the intelligent M-Squares with our Archimedes (formerly Navigator) Algorithm to put all of this math on your side without needing to become a physicist. I promise to go easy on the math and physics involved – you don’t need to be a professor to understand the general theory of how the M-Squares work. Here is a hint – Time = Price^2.

S&P 500 Continuous Index Futures - Daily plus the Archimedes Algorithm.
S&P 500 Continuous Index Futures - Daily plus the Archimedes Algorithm.

⊕ Forecasts are fun (when I am right). And the news is typically wrong – or at least untimely. 

But we don’t need to know the future, only pay attention to what is in front of us. No matter what the pundits say, price is the ultimate “Determinator.”

As is often the case, price has vehemently opposed the bearish narrative for months. But get ready for price to have a little downside revenge on the narrators just as they become bulls again.

⊕ And what about the “crash” – the big Kahuna?  It is still scheduled. It has been discernable and scheduled for years. The cycles tell us when it is coming. But you would have nothing to look forward to if I tell you now. Maybe I will give some hints in the upcoming webinars.

A.F. Thornton

$ The Million Dollar Squares Trading System™ $

Upcoming Webinar - June 8, 2023 - 7:00 PM Central Time

Hello Everyone:

Mark Twain would say, “The rumors of my death are premature.” I finally sequestered myself off the grid for a few months to create the Webinar Series I have wanted to do for so long. It was a formidable task, but it is finally done.

And now you can learn how to make calm and consistent trades…

You can take our trades or get granular and do them yourself with our tools on your computer!

I had already solved the codes and master time factors – call it the DNA of actively traded financial instruments and commodities. I have simplified a complex subject into a system with clear buy and sell signals and rules.

It’s so reliable that you can trade any time frame or market condition. The daily strategy signals already banked 900% with the Emini in 2023! And there are less leveraged ways to go too.

While that’s certainly impressive, it says even more about the precision of this strategy that you could put on your trades and go to the beach…

Instead of stressing over charts all day, you could be out with your family enjoying life without a care about what the market’s doing. And there is live support in our Founders Trading Room until you feel you have mastered the system – even from your phone.

And you will always know how the Founders Group is applying the signals.

We get feedback like this from our existing members…

     “Your system is awesome; just love it!!!” – Jon

     “Been a long time since I’ve been this excited about trading.” – Michelle

     “It’s not just that the signals work; I am amazed that they often work to the minute and tick. How can you forecast the price and time of the turns so far in advance?” – Andrew.

The system is even more impressive when considering the recent bumpy market.

We’re doing something really special for this upcoming class. So, be sure to attend – it’s live! We will hold several sessions, but they won’t be recorded!

Go HERE to save your spot

A.F. Thornton

Moment of Truth – Part III

S&P 500 Master Cycle Update
S&P 500 Master Cycle Update

Good Morning:

 — For the third time, the price is testing 270 degrees of the trend from October 13, 2022, at 4175. Will persistence beat resistance?

 — This third trip counts November and January. And the location also happens to be at the top triangle consolidation line from August 2021. We have discussed this line over the past few weeks.

— Indeed, this is a critical moment for bulls. As we come to the end of the week, the price action nearly matched last week’s candle. But traders were not quite able to drive to last week’s low yet tested slightly above last week’s high. Does this give the bull’s a slight edge?

— Yesterday’s price action brought the daily and hourly strategies into a buy signal at 4131.50. We lightened up the positions at 4175, keeping half adorned with the usual caveats that the price maintains the five-day line and the machines keep buying there.

 — I continued to be surprised by the bullish price action since last October, especially given the headlines. But what doesn’t surprise me is that the Master Cycle predicted as much.

 — We had the Master Cycle prediction in our toolbox for a long time. We could publish a roadmap for the next five years. But the path ahead is not something to ponder if you want to hold down your food today. So we will keep the future under wraps.

 — But in the shorter term, the Master Cycle has predicted good things and continues to do so. Why? Your guess is as good as ours. History rhymes and the current period seems to track both the 1960s and 1920s. Both of those decades did not end well, and neither will this one.

 — The Master Cycle did fall to an 80% correlation on the latest banking crisis, but it is back to 85%. If it does drop below 80%, we will consider the possibility of an inversion. Nothing can predict an all-out collapse at these debt levels.

 — Subscribers get the information they need in real-time. Consider a subscription if you want to know when to buy and sell. It is a prescription for success.

A.F. Thornton

It’s a Schism-Based Stock Market

S&P 500 Cash Index Big Picture - Monthly Candles - Click Chart to Enlarge
S&P 500 Cash Index Big Picture - Monthly Candles - Click Chart to Enlarge

Good Morning:

 — Our algorithms brought subscribers back into the stock market (S&P 500 Index) beginning at 4113 over a week ago. But the Archimedes’ Hourly strategy tripped a sell signal at 4132.50 overnight, and the Daily strategy also tripped a sell signal at 4121 in Globex as I am writing this. We have been rotating some of the position when it is overbought and picking it back up at the 5-period line. But the weight of the evidence calls for a short-term turn today, which appears to be coming earlier rather than later.

 — We accumulate on the 5-period line in both strategies until it stops working. Price discovery much below the 5-period line triggers our stops. While it may seem somewhat of a conundrum, subscribers understand the approach.

 — The big picture in the Monthly Chart above shows the schism between a rising market since last October and the black swans circling above prices. A wide range of inept policies by political and financial institutions brought us to this point in only two years. Note the 2000-2002 bear market out to the left side of the chart with our M-Square framing. It is a close analogy to the current market.

 — “C” waves are dreaded. But as we saw in the March 2020 China Virus crash, they don’t always present. But carry the risk forward in our narrative because price reached the top of the consolidation triangle at the April 4 high, around 4138.

 — And when today is a short-term turning point on the daily chart as can be seen below, caution is elevated.

S&P 500 Futures Daily Chart - M-Square and Archimedes Turn Point Today - Click to Enlarge
S&P 500 Futures Daily Chart - M-Square and Archimedes Turn Point Today - Click to Enlarge

 — So if the machines fail to buy on the five-period line on the daily chart, and price discovery drops below Thursday’s low at 4121as is happening in Globex, cash is king once again, and shorts become attractive.

 — Our hourly strategy already stopped out in Globex at 4132.50 and may lead the daily time frame lower.

S&P 500 Index Futures - Hourly Chart Sell Signal Tripped (Clicked to Enlarge).

 — Supporting lower prices, the measured move from the last turn major turn point in early March is complete. So there is no reason to ignore this turn in the other direction.

 — And today’s turn date also shows up on the Master Cycle, though it is not forecast to be a major turn as yet. Only time will tell.

A.F. Thornton

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