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

♀ 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.

☉ 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 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.

☽ 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.

⊕ 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