As discussed on these pages for months, the week of the 21st was likely to be a lower high and also likely to open up a pronounced period of weakness. The projection turn-window appears to have been left-translated - meaning occurring early in the timing window rather than middle or later regions of it. There is still a relatively low possibility the market can try to hold up into sometime next week, however, on a short term basis MSP suggests market stabilization or even bounce attempt into early Monday morning but that overall session into the cash close should have higher than normal bias toward weak price action If such a scenario is the case, it would likely be difficult for the market to recover from, which is why it is most likely that a left translated turn has occurred. When we made suggestions relating to this structure, it was well before the market's initial foray into August 24th lows and knowledge of how strong an expected drop into the area of August 21st would be. We had expected significant weakness into the 21st, but not particularly a crash - but nonetheless the tool-set and resources and guidance at mcm was exemplary and conservative.
As implied by the mcm data (many charts posted on these pages), the drop into August 24th was NOT a bottom or even capitulatory - it was a more likely breakout to the downside. Almost all of our systems have switched to a bear market bias after being bull market biased since 2011 and primarily looking for long during this period. NOW THEY ARE FOCUSED ON SELLING STRENGTH and sold the recent bounce into the MSP reversal timing. What is now suggested via market structure projection is what could become an extended period (3 to 4 weeks) of pronounced weakness into October with high probability that the August 24th lows are breached - most likely significantly. As the European markets are leading this decline we are presenting the MSP picture via the DAX - but the S&P500 picture is very similar. Please note, that a break of the 1820 on the S&P500 cash could open the floodgates if it so wishes and bring into focus targets from the 1680's to 1620's. The area below 1820 has quite limited and thin support and does not see more solid potential until the 1600's somewhere. Either way this is NOT your grandmother's market it's a liquidity trap of epic proportions, so, regardless of projections or any other trading approach, great care is currently warranted.
Being aware of the pronounced risk potential ahead, we have done several webinars to present methods to effectively and objectively participate in what can become violent maneuvers ahead. In that light we did a seminar on more details regarding impulse trading and handling of violence in the markets. It was a long webinar, but we think pretty effective in communicating and transmitting learning and some techniques that we feel can help overcome emotional stresses and haphazard risk-taking. We invite you to watch the recording of the event at: Click here for the video. The video is free and we hope you may find it of value. We would like to thank the people who spent time with us this weekend and look forward to scheduling another event at some point in the not distant future.