REVERSALS AND TRENDS

📉 S&P 500 – 22nd week of the base cycle (avg. 20 weeks). The current base cycle is at the edge of maturity, where reversals often form. By Friday’s close, S&P once again showed signs of a reversal from a new ATH. Against the backdrop of fresh highs in S&P and DJIA, a bearish divergence with NASDAQ persists (see chart). 💰 The short position opened on Friday’s technical signal from the 27 Aug pivot-forecast impulse was closed by trailing stop at breakeven. On the 1 Sept pivot-forecast (previously noted for gold and crude oil), a long position was opened. ⚠️ The next extreme-forecast for US equity indices falls on Monday, 8 Sept — a strong forecasting aspect with high potential for surprises. The following extreme-forecast for US stocks is on 22 Sept. 🏆 GOLD – 3rd week of the new base cycle (15–20+ weeks). Finally, the long-awaited bullish breakout. The bulky technical formation turned out to be a continuation triangle. 👌 The 25 Aug extreme-forecast still worked and ...

🔺 Let’s start with the S&P 500 chart. Everyone’s seen it: since the crisis it’s been ripping higher from 1000 toward 6000, with only a few dips like 2022, spring 2025 or Covid. The logic seems simple: buy the pullbacks, hold, and you’re in profit. Most believe that this rise reflects the real value of companies. It doesn’t. The key lies in passive investing. Money floods into funds where nobody looks at earnings reports or valuation multiples. The algorithm is simple: buy the index and forget. This flipped the mechanics — price became value. If the chart goes up, it must be “right.” That substitution turns the market into a bubble: it gets more expensive simply because it already is. Why is this dangerous? Because the S&P’s market cap is already well above $50 trillion. And if the growth is driven by “blind” buyers, the selloff will be driven by equally “blind” sellers. There aren’t enough active investors to catch the falling knife. A doom loop kicks in: mass outflows trigg...