Founder's Trading Journal

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Good Evening:

☿ – It is one thing to handle the market as it comes to you, but you enter an entirely new paradigm when you can predict the turn windows well in advance. Granted, you don’t take the curve blindly at 100 mph, but when the stars align you know what to do.

☿ – And if I told you I predicted the market’s path over the past 15 months with 85% plus accuracy more than a year before it happened, would you be interested? Well, I did. Below are the charts published just since early February, identifying the Thursday/Friday turn. Go back through this blog, the information is all there.

☿ – Actually, we could have made the prediction many years earlier. Soon, I will publish a prediction for the next five years, but I hesitate in doing so knowing what lies ahead.

☿ – Let me be clear, I am not bragging. Nobody is more amazed than I am. But when you unlock the mathematical codes, anything is possible. These codes have been hidden for millennia. I am not the only person to crack them, but it is a small club. And when you are in the club, it is an unwritten rule that you not reveal the information.

☿ – You see, the codes are not just about the stock market. They are universal. The same codes apply to physics, engineering, medicine, biology, finance, business, computer science, and industry.

☿ – Nikola Tesla had the codes. Upon his death, the FBI cleaned out his safe and the technology for free and abundant energy along with it. Free energy does not serve Big Oil or the power of the World Economic Forum. We had the cure for most cancers by the mid-1850s using the codes. But that doesn’t serve Big Pharma. And if the little guy had the stock market codes, Wall Street would have nobody to rob. It is a zero-sum game. Someone is either taking your money or you are taking theirs. It is an age-old story.

☿ – The codes were purposely obfuscated beginning with the Roman Empire because elites throughout history coveted the knowledge and did not want it in the hands of commoners. Rome even changed the calendar to keep the public off track of how things work in the world and physics. It is all connected. And the Vatican Library has all of this information under lock and key.

☿ We fret like rabid dogs over this report and that policy. In reality, the path is preordained. Sure, the market can be rocked at the margins by current events, but it eventually returns to the path. It has DNA, a signature, and a frequency. Some call it the Law of Vibration.

☿ – I will save the story for another time – maybe an upcoming Webinar. For now, the market actually started waking up with the Helio cycle turn the preceding Thursday. But the current path can be ordained from the following charts published on these pages beginning February 10th.

☿ – Would you like to learn how to do this? I am working on a series of Webinars that I will announce soon. While there are certain secrets I will likely never reveal, I will reveal enough that you will be able to do this and more.

☿ – So we are always in long on both the Daily and Hourly Archimedes Strategies at S&P 500 Futures at 3931.25. Subscribers got the signal live last week. Closes below the 5-day line triggers our maximum tolerance stop, but we tend to look for exits beforehand.

☿ – The market is ahead of itself, and “V” bottoms are rare, so a retest of the recent lows is possible. But the Master Cycle predicts the market moving higher until it stalls again in May. That is where it gets interesting.

☿ – And we are still in the inversion window for a few more sessions, so the market is not solidly out of the woods yet.

☿ – But I would not want to be a bear right now, that is for sure.

Enjoy the ride while it lasts. Consider a monthly subscription as it will more than pay for itself. Attend the webinars to learn more.

A.F. Thornton

Founder's Trading Journal

A New Dawn – 3/1/2023

Mar 1, 2023 AF Thornton 0 Comment

Good Afternoon:

☉ As winter transitions into spring, BluPrint Quantitative is transitioning too. We have some exciting announcements.

☉ Henceforth, we will be known as Archimedes Methodologies, Ltd. Our new email address will be TradingArchimedes@gmail.com. Our new website address will be TradingArchimedes.com. All former websites and email addresses will still work and direct you to the new site for the next year.

☉ The motivation for the name change is twofold: (i) there has been confusion with other firms that started after us with similar “BluPrint” or “Blueprint” names. Second, the name better reflects the Geometry, Physics, and Astrometry (Kinematics) supplementing the traditional technical analysis in our algorithm.

☉ We will continue offering a timing service for public subscribers and a series of educational Webinars. The timing service offers two levels of swing buy and sell signals; a short and intermediate-term swing trading service. Subscribers will receive all necessary support to act on the signals.

☉ The cost will be $297 monthly until September 1st, when the price will increase to $369.

☉ On September 1st, all existing subscribers will be grandfathered at the $297 fee for the life of their subscription.

☉ We will earn this fee in droves. At this writing alone, our subscribers avoided a 6% loss since our last sell signal on February 2nd. They avoided a 30% peak-to-trough loss based on our January 2021 sell signal and October 2022 buy signal. More gains were possible from the October 2022 low to the February 2nd sell signal.

☉ And if one had shorted the market on the sell signals and reversed to long on the buy signals, returns compounded even further.

☉ A subscription allows you to earn potential triple-digit annual returns, as we have demonstrated over the past three years.

☉ While the past cannot predict the future, and there can be no guarantees, we believe we proved ourselves these past few years by successfully navigating the most challenging stock market in 15 years.

☉ After struggling with renaming the algorithm, we have decided to mix the new with the old. Henceforth, we will call it the “Archimedes Navigator™.“

☉ The Archimedes Navigator™ is a fractal trading algorithm that works in all time frames. I will occasionally break out the individual algo components (like the Helio and Athene) for educational and demonstration purposes.

☉ All monthly subscribers to the timing service will now have access to the Founders Room and live text alerts when we issue new signals. The Founders Room will serve as our primary meeting place and bulletin board. The “Files” section in the room will have all the information you need to understand and trade the signals.

☉ Instead of an elaborate morning blog that takes me several hours to prepare and write, I will send my thoughts to subscribers throughout the day by text. I will also post the comments in the Founders Room, and we will email the comments at the end of the day to all subscribers.

☉ We will also use the room to gather on short notice for events that require more than a text alert. The room also has a mobile app for your phone or Ipad. You can enter and view the room anytime from any mobile device and access live video and posted live charts.

☉ As you can see, we will use the Founders Room in many ways. And I will still demonstrate day trading and feature guests from time to time in the room.

☉ I will announce the day trading on more of an ad hoc basis each Monday. Generally, though, we will day trade at least once a week.

☉ We are also announcing a progressive series of three educational Webinars. The purpose of the webinars is to break out the components of our algorithm in a logical sequence and teach the methodologies. Premium subscribers will receive substantial discounts on all webinars.

☉ The importance of learning the methods underpinning the algorithm cannot be understated. Our algorithm is merely one way to combine them. Alternative combinations are infinite, and you can customize them to your trading style.

☉ The third program in the series will be an in-person mastermind held quarterly at a destination resort. It will be limited to five invited participants, last about four days, and include live trading. I will personally mentor these students and groups going forward.

☉ Graduates will become members of the special Founders Group, know everything we know, and have access to all proprietary indicators.

☉ Details and prices will be announced in the next few days.

☉ Our website will occasionally be down (and may look funny) as we implement the new changes.

☉ Existing blog fans can sign up for a free trial of the new service before committing.

☉ I will still post occasional commentary and YouTube videos on these pages, just not every day.

Thank you in advance for your support of these changes. We are excited to take committed investors and traders to their next level of success.

A.F. Thornton

Founder's Trading Journal

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Good Morning:

On the housekeeping front, we will have major announcements later tonight that will be effective tomorrow, March 1st. Included will be the announcement of our first trader Trader Intensive.
Suffice it to say that I have not had much of a life over the past few years as I dedicated my time to this endeavor. I had retired for many years before starting this company in late 2019.
And there are complaints on the homefront too. I have been working 18-hour days on average. I have ignored my health and exercise. When I look down, my feet have disappeared! I spend too many hours in front of 10 computer screens.
While we are grateful for our reception in the investment world, I cannot keep up with the emails and inquiries. In the end, time is our most valuable commodity. Family is the most important part of our lives. We don’t get this time back.
So my partner Michael and I are taking the website private to dedicate our time to our premium subscribers.
You may have noticed the name change. We want the name to better reflect the math, physics, and astrometry (kinematics) behind our algorithms.
As a private site, We can be more open in our discussions with Premium Subscribers and Founders Group members without the prying eyes of competitors.
You will receive the details later tonight. Prices for premium subscribers will rise, but there will be more services, privileges, and discounts for training programs starting next week. There will be a 7-day Free Trial for those interested.
Existing Premium Subscribers will be permanently grandfathered as prices rise over time. Once you are in, you are in. You will never pay more.
We know what we have created works, leading to triple-digit returns over the past three years. But subscribers also have to be able to execute the strategies practically, and we are improving that process.
We look forward to the changes, and we hope you will too.
On the Global front, Treasury Secretary Janet Yellen visited Ukraine yesterday. Add that to visits by Attorney General Merrick Garland and Teachers Union President Randi Weingarten.
These are just the non-defense officials we know about. Did this happen with the Iraq Wars? Of course not. How about Vietnam? No. I doubt it even happened in World War II.
I am suspicious that these highly unprecedented visits are about kissing Zelensky’s ring. Many believe (irrationally and without reading the biblical prophecies carefully) that Zelensky is the anti-Christ. I would identify the claim as incredible, except the unthinkable is always coming true lately.
More likely, these officials are flying over to pick up their bags of cash. Wires are traceable. This administration may be the most corrupt in American history.
Meanwhile, not much has changed on the market front. This week remains the Scheduled nominal 20-week Hurst Cycle trough turn window, and the Master Composite Cycle formally turns on March 3rd (Friday).
4000 is identified as the first pivot level – and continues to act as the fulcrum between bull and bear market behavior. I think we will take this level out later this year.
But with rapidly rising short-term rates back on the table, we could see some short-term fireworks as the market puts in the pivot low. The turn window remains; the pivot level remains in flux.
Last Friday’s inflation surprise still changes over the market.
What the bulls have on their side is that in the waning stages of an inflation-induced collapse, investors buy stocks to hedge inflation. The 1920s is a good analog.

A.F. Thornton

Founder's Trading Journal

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Good Morning:

This year as last, the stock market (as measured by the S&P 500 Index) continues to follow our Master Cycle Forecast with a correlation of 89%.
The pressure forecast compresses the most important cycles influencing equity markets into a proprietary composite of one to 60 years.
Year after year, following the forecast alone leads to triple-digit returns. Our main requirement is that the correlation stays above 80%
No strategy is flawless. When the correlation drops below 80%, the cycle tends to invert. The turn dates don’t change, but the direction of the Cycle does.
In such cases, Peaks will replace troughs and vice versa. We are always on guard for such a change; And that is where our Price Action indicators help guide us.
Beginning last Thursday with our proprietary Helio Algorithm, we entered a series of turn windows mostly associated with the nominal 20-week Hurst Cycle trough.

But did the Helios Algo deliver? Once in a while, if a “news” event intervenes, the market will temporarily derail. We saw that Friday with another surge in inflation as measured by Personal Consumption Expenditures.
But proving that the cause of market advances and declines has little to do with the news, the train usually gets back on the track.
You will have a chance to witness this in real-time. I always mark these temporary derailments on my chart as “news” lest they confuse me later when memory fades.
That is why It is imperative to keep a good trading journal to be successful in this endeavor.
So, for now, I expect the market to turn north again this week and advance through May, just as we forecast in our annual outlook.
And then the old saying “sell in May and go away” might be the new mantra. The market will stumble in May, and the bears may recover their footing.
We are still in our February 2nd sell / short signal. If you are short the market, I would cover positions sooner rather than later and prepare to go long again.
If we drop to half-day candles (see below), The market already has Algo and Momentum divergence buy signals if today’s price action closes at or above current Globex levels (4000 or above). These lower time frame signals don’t always follow through to the daily time frame, but it is a good ‘heads up” signal and plenty of reason to cover your short-positions.

If the buy signal triggers today, the first test of the new advance will be the 2/21 breakdown at 4060.
The Trading Room will be open on Tuesday and Thursday this week.

A.F.Thornton

Founder's Trading Journal

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Good Morning:

Did you notice the severe winter weather across the country yesterday? It was merely one symptom of predictable, increased solar activity.
As mentioned on these pages, a year ago we took a reliable weather prediction algorithm and gave it a few stock market tweaks. we then created our “Helio” algorithm, which identifies the peak intensity of this activity and predicts price reversals.
Not only did We back-test it for 10-years, we also tested it live over the past year. The results were beyond impressive.
We can even use the algorithm to identify 8-hour cycles for short-term trading signals. More on that another time.
So, did the signal we have been Publicly forecasting for a month in advance work yesterday? You be the judge:

We were closing the Trading Room yesterday when an astounding “V” reversal slowly began to take shape. Like a dunce, I thought the signal had already presented at midnight. Then I realized I had misread my notes and the signal actually reached its max intensity at noon EST. In retrospect, The reversal began right on cue.
The reversal must have been somewhat of a surprise to most traders. After three initial bull bars, our Trading Room started on a short signal yesterday. The sell-off was severe.
Typically, there is an 80% chance that the market would only recover to the mean and continue selling. But that did not happen.
I hesitated to take any short signals yesterday due to the anticipated Helio Algorithm turn. A temporary signal seemed inconsistent with the predicted “reversal,” which usually lasts a few days.
Ultimately, we could have worked both sides of yesterday’s trade – but one cannot know that beforehand.
I even had my doubts as the buy signal began to develop. It looked weak, even though the market was oversold and too far below the mean to be sustainable. Anyway, the rest is history.
I cannot remember seeing such a stunning “V” reversal in a very long time. All we needed to do from the buy signal was follow our Athene algorithm (formerly the Navigator).
So where does that leave us this morning? We have a slew of economic reports pre-market. The reports include the PCE inflation report. So the market will be volatile. And the reports have the power to negate the reversal, but typically they don’t.
And The Helio Algorithm turn is rarely a one-day wonder, though it does not give us a price or time target, just a reversal.
But here is what we do know. Price reached the bull trendline (October 13th, January 3rd) yesterday and found buyers.
That follows the bears’ February 21st breakdown with minimum follow-through yesterday, so bears are likely disappointed. Their follow-through is not ideal.
Yesterday was an outside trading range pin bar that shows hesitation at the 4,000 big round number, which has been an important price level for the past year.
There are targets below for the bears. However, the market still shows likely trading range behavior.
With tailwinds from the Helio turn, the bulls might continue to get a bounce to test the 2/17 breakdown from 4060.
Traders will pay close attention today to see how determined the bears are to continue selling.
If the bears begin to hesitate and buy back shorts, bulls will buy aggressively, increasing the probability of the market continuing higher to test the 4060 Breakdown low.
If the market cannot pierce the 4060 level on the way back up, it could continue the correction and test the January pivot lows around 3911.
Overall, the odds favor the bears getting disappointed over the next day or two. The market likely continues to go sideways around the 4,000 big round number. The lower probability event would be a strong downside breakout.
Our algos remain in a Macro Swing Sell (short) Signal from February 3rd.

A.F. Thornton

Founder's Trading Journal

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Good Morning:

The 20-week cycle correction continues but appears ready to bounce off the 50-day line, 20-week line, Trendline connecting the October and December 22 lows, and 90-degree line from the top. The rounded level is 4000 on our chief market proxy, the S&P 500 Index.
Note that the DNA of the 20-week moving average is the Nominal 20-week Hurst Cycle. Moving averages are a crude, late, and untimely method of tracking cycles.
As such, however, if the 20-week average holds, we can have more confidence in a turn, likely with a double-bottom retest. Then the price will return to retest the recent high at 4208.50.
As discussed yesterday, if the market does not hold the line here, perhaps another, Longer cycle is manifesting.
Hurst Analysts are divided on whether the Nominal 18-month cycle bottomed in October or is diving into the 18-month process low now. The evidence favors the cycle bottoming last October, but carry the alternative outcome in your narrative just in case.
Also, the Nominal Hurst 54-Month Presidential Election Cycle begins to exert a downward influence soon. Carry that forward in your narrative too.
And our forecast for 2022 called for a rally into February, a medium dip into early March, a rally back into May, and further declines into the Fall. Ultimately, the year will likely be more of a sideways market with a slight upward bias.
Our proprietary Helio Algorithm supports the bounce today, which has a turn date today, which began at Midnight EST.
Briefly, the Algorithm forecasts Magnetic Field Field Strength associated with Sun Spot and Solar Flare Activity.
Think of the Sun as a giant ocean with tidal waves.
Under various gravitational influences from planet alignments, the tide increases, leading to increased solar activity.
Not only does a certain level of activity affect financial markets, but it also affects the weather, earthquakes, and the functioning of Satellites and other electronics.
The chart above shows the recent signals, and they are highly accurate.
As with most of our signals, they don’t forecast the gain or loss we might experience. We use our other work to set targets,
For this turn, the price should test the breakdown area at 4068 (also the mean). Traders typically sell the first test of the mean after a breakdown. That is why a retest will likely bring us into the early March low forecast by the 60-Year Master Cycle.
Take a look at the signal back on 8/21/2022. That is the likeliest outcome from this turn. I don’t expect a similar decline to follow as in 2022, but more of a retest in the circumstances.
I will be on the mic in the Trading Room today for the first few hours.

A.F. Thornton

Founder's Trading Journal

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Good Morning:

Beware of the Ides of March? In his recent tweet, Milton Berg (Twitter: @BergMilton) reminded me about this yearly cycle.
This year, using the ancient definition of the full Moon in March, the ides of March fall on March 6th/7th, 2023.
It is the last full moon in the winter, and hereafter people are looking naturally forward to spring and summer, making us all feel more joyful, leaving the cold and the dark behind us in the Northern Hemisphere.
The late Paul Montgomery wrote about this in his March 2009 newsletter:

So, in addition to the other reversal dates in our Windshield, Add March 7-8. I strongly encourage you to review yesterday’s outlook and study the chart above.

Though I don’t have a crystal ball, I expect the market to correct into early March and advance into May.
Yesterday, the market sold off into the 80-day cycle trendline and support. That could be it for the low, with a retest about a week out.
If the market does not hold yesterday’s low at 4002, the measured move is double the current decline, around 3800.
Notably, time estimates remain unaltered. If the past is any indication, expect an advance starting in the next 24 hours that will likely test the breakdown from 4050.
Unless we see a rare “V” reversal, I believe the first rally will fail, roll back down into a retest of the first low in early March, and finish the correction.
The next advance should take us to the full octave at 4288.
As always, carry the Black Swan exception forward in your narrative. As always, I could be wrong. As always, we will seek confirmation from our three algorithms and the price action to confirm the termination point.
You will continue to see some changes in this forecast and on the Website – and I will explain them soon.
On March 1, 2023, we are taking the Website and our services “Private.” readers can request to subscribe to read these posts. Free subscribers will no longer read (free) posts but can order a (monthly/yearly) paid subscription.
This will not affect our existing premium subscribers. From now onwards, we will focus our services on premium subscribers only.
What we publish on these pages is too valuable for public access. Moreover, we will feel free to discuss details we do not want to publicize.
For now, I want to announce an Introductory webinar this Saturday at noon EST, where I will teach a few strategies with an 85% success rate and triple-digit annual returns. Attending the webinar costs $795.00 with a money-back guarantee if you are not satisfied.
You will receive an invitation to the webinar in the next 24 hours.

A.F. Thornton

Founder's Trading Journal

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Good Morning:

Unhappy first Russian invation anniversary! Of course, I am referring to the anniversary of Russia’s invasion of Ukraine on 2/24/22. The first anniversary comes on Thursday. Will there be any surprises from Russia? Can you even believe all we have been through since?
It is a good moment to step out and gain some perspective on price. In the S&P 500 Index Futures Chart above, our chief broad stock market proxy, we posted the Founders Group’s weekly view.
Notably, this morning, the market is slated to Gap below the weekly stop line. Gap Rules are on the table. The downward trajectory of the index continues to validate Our timely exit on 2/3
Also, note that the price is entering its third week of correction (slightly lower highs and lower lows) concurrent with the third month of alternating slightly higher highs and lows. essentially, Price formed a wide trading range capped with rejection spikes at 4208.50. The lower boundary is framed with rising spikes starting at 3700 In November at the extreme.

If you didn’t notice the correction, it is understandable. Day to day, The index has been so strong that the higher highs and lower lows are barely noticeable on the weekly or Monthly chart. getting lost in the weeds is easy.
The bullish rise from October perhaps indicates that the October low is the Nominal 18-month Hurst Cycle low and the conclusion of the first phase of the bear market.
But the Bears see that most buying has been retail, sometimes called the “Dumb Money.” So they don’t give the advance much credence.
Moreover, the Hurst Nominal 54-Month Cycle might easily be crowning over the top of us On its way to the presidential Election cycle low scheduled for late 2023 or early 2024. But profits are profits even when we take them from the retail crowd.
And remember something else; Bull Market corrections tend to come late in the cycle, carving quick, deep, and climactic. And then there is the retest. Recall the spike lows and retests we experienced in the Bull Markets before the 2022 bear market commenced.
Anyway, strap in and patiently await the low. There are no old, bold traders. If we just began the first intermediate correction of a new bull market, Some wild slides may mark the week ahead. But mercifully, one can hope it won’t last.
And looking at the monthly candle bodies, 4088 has been handily rejected in November, December, January, and February. There is the old saying, “Persistence Beats Resistance.” Still, will that hold true if we remain in the Bear Market?
And when do you know for sure that the bear market is over? Unfortunately, it takes a new, all-time high to decisively Confirm the end.
For now, Conquering 4088 (and eating its tail up to 4208.50) opens the door to doubling the Monthly Range. A conservative Target would be the full Octave from October at 4288, previously discussed on these pages.
On the other hand, dropping through the 3888 floor suggests a minimum return to 3688, perhaps Tagging the rising trendline connecting the March 2020 China Virus Low (ES 2121) with the October 2022 low (ES 3502). That will be the optimistic case if the market starts flirting with significantly lower prices.
The bottom line is that the market has been correcting/consolidating for three months. It has been building energy. Now it will expend some of it.
Is this balance zone distribution ahead of further bear declines or accumulation ahead of another bull market leg? We should know by Friday.
Our best judgment is that the market is declining into the 20-week trough this week. The track appears shallow and Manageable at this writing, though the price may spike lower into the turn. According to Navigator II, The First likely pivot higher will occur on 2/23 (Thursday).
Multiple turn windows exist between 2/23 and 2/25, but the Navigator II magnetic flux reversal promises to exert considerable influence on the stock market to reverse its prior trend coming into Thursday.
While the indicator predicts the turn, it does not give us a target. We will derive that from our other work.
Note that this magnetic field burst also affects the weather and can induce hurricanes, earthquakes, and other anomalies.

Historically, the market reverses its prior direction 85% of the time when the magnetic field indicator exceeds 7 (solid horizontal line on the histogram chart above).
In the other 15% of cases, the market noticeably accelerates in the same direction.
Every time the indicator exceeded 7 so far this year, the market reversed direction down to the minute.
No doubt, The market may give the crowd a good scare this week, but ultimately will turn higher and test 4108 again.
This analysis does not negate the bear argument, as the bears are as entrenched as I have seen in my career and they may eventually be right.
For the bearish case, we need more confirmation that this “B” wave higher has ended. But if it has, the dreaded “C” wave could already be underway. carry the bear case forward forward in your narrative until we can negate it.
Our annual forecast called for the market to move higher into late February, correct into March, and go sideways to slightly higher into May. After May, we see a lot of technical pressure reasserting the bearish case.
Let’s see what happens, but the Navigator Swing Trading Algorithm went to cash (short for aggressive investors) on February 3rd and remains there. I am confident with three algorithms that are wholly Diverse in their approaches; we will stay out of harm’s way and find the low soon enough.
And don’t forget that war is good for business, though otherwise reprehensible. And business only benefits if all of us are not blown to smithereens.
But the black swans are swimming too. Don’t enter the fray without prudent downside protection.

A.F. Thornton

Founder's Trading Journal

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Good Morning:

Until otherwise resolved, the stock market (as measured by the S&P 500 Index) is in a trading range bounded to the north by 4135 and 4065. Balance Rules apply.
Fed Governor Brainerd (now leaving to be President Orwell’s economic adviser) triggered yesterday’s late-day sell-off.
Inflation and Fed policy still rule the day.
The Fed does not seem to favor higher stock prices, so they are talking the market down.
Anyway, the 20-week cycle trough is due and may be underway.
The bears are looking for a crash, and they have their arguments.
The bulls are looking for a muted 20-week cycle correction due to the market’s strength from the October 2022 low.
And though the landscape is a bit distorted due to monthly options expiration today, the market has moved sideways because neither the bulls nor the bears have prevailed with their narratives.
Our Zeus Algorithm (formerly the Navigator II) has been in a sell signal since 2/3, followed by our Zeus Algorithm (formerly the Navigator) on 2/8. Our Janus Algorithm issued a final sell signal on 2/13
The next Zeus turn date is on 2/23.

Have a great weekend!

A.F. Thornton

Founder's Trading Journal

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Good Morning:

If you haven’t seen Monty Python’s meaning of life, the title this morning might not mean anything. It is a hilarious Comedy.
In the scene I referenced, an obese man is feasting at a table full of food. When it seems he cannot eat another bite, the waiter says, “how about just one more thin mint.”
Of course, the man swallows the mint, and then the man blows up into a zillion pieces.
That might be where the stock market and its proxy, the S&P 500 Index, find themselves. This (likely) final leg is the “Last Thin Mint”) before a 20-week cycle correction ensues.
And with the CTAs (Momentum Traders) and the ODTEs (Zero Days to Expiration Options players) at the table, the ensuing volatility might require some Alka Seltzer.
Overall the Stock Market is deciding if the last ten trading days are a bull flag or a topping process.
We believe traders should expect a Small and Final Bull Leg as the Market digests Monthly Options Expiration on Friday. Nevertheless, the Market could peak at any time and might be forming a “Cradle Trade” into the Algo Trigger (at 4175) to Move Lower.
Recall our Price Projection (4288) for the peak of the Rally from the October low. The Market could Still get there quickly in a blow-off run, so keep an eye on that level.
And the August 2022 high is 4345.75, also a slightly higher target in a blow-off run.
But the lack of follow-through after Friday’s pivot higher shows some weakness in the price action. Weakness is important – but there is no solid sign of a top yet.
Also, the price remains in a small pullback bull channel on the daily chart. This is a sign of steady, algo buying. And while sentiment seems too bullish for the Market to move much higher without a meaningful correction, sentiment often stays near the bullish Extremes for some time if this is a new bull market rather than a bear rally leg.
Resistance remains at the recent high (4208), with support at the recent low (4060.75).
Economic data this morning includes wholesale inflation (PPI) and the latest unemployment claims.
I will be in the trading room for the first few hours today. Tomorrow is the Monthly Options Expiration. So be careful going into Friday.
On a housekeeping note, you may see some changes to the website and our branding over the next week.

A.F. Thornton

Category Founder’s Trading Journal

A New Dawn – 3/1/2023

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