🔴 Updating “The Biggest Trade of the Century” with Michael Oliver – Live Update

🔴 Updating “The Biggest Trade of the Century” with Michael Oliver – Live Update

Where do I start?
Hello, I’m ma Michael Oliver with momentum structural analysis
we’re gonna take a tour today through su
Archival charts of the stock market and current charts and I’ve made these observations before in a real vision video
Several weeks ago, but we’re going to add to it this time and give you some more information and some perhaps some insights
You don’t have to be a technician. I don’t think to appreciate the charts that have been provided to you by real vision
There’s five sets of charts
We’ll go through them one by one and I’m just going to leisurely chat as we go through and make some comments and observations
And then we’ll go to the next set of charts and so forth, but the conclusion we come up with
After analyzing the stock market, which we’ve been doing since 1992 when NSA was founded
Is that we have one of the darkest most malevolent
Technical structures underneath the stock market that it’s ever had before going back a century of technical data
Look whether we look at the Dow back in the 20s up to 1950 and then in 1953
I think the SP began but going through the entire period we’ve never seen the technical momentum technical vulnerability that we see now
MSA is
unorthodox in its technical approach in that we
Tend not to focus primarily on price charts. We look instead
Primarily at momentum of price and we measure momentum
Probably a bit differently than most people who use that term, which is a common technical term
tools like MACD and RSI or momentum type tools, which
Really don’t resemble the type of type of work we do the question is why do we?
distrust replace price chart technicals as a secondary
momentum technicals and
for explanation to that we suggest you go to our website Oliver and then say
Dot-com and go to the method or methodology tab and read the articles and see the charts and the explanation as to why
Price to us as a secondary technical feature
To briefly give you an answer to that the teasing answer is that price is measured by a fiat currency
Let’s say the bushel own price of corn
What’s the bushel of corn cost in dollars? What is the given stock cost in dollars a barrel of oil etc?
All measured in dollars or in euros or yen
The problem is these fiat currencies since 1959. Anyway, the dollar
Has doubled nearly doubled in quantity every decade
so if you consider that let’s say you had a yardstick and you were building building a house and
It took you six months to build the house, but your yardstick
Changed one inch every month. It still said 36 inches
But it really grew an inch
Though it still said 36 inches
So by the time you finished after six months of building the house is likely to be in decrepit shape and collapse
So the means of measurement that we use in markets
whether it’s price of a stock or the earnings or whatever is
Heavily distorted by the deterioration in the underlying fiat currency, and it’s it’s it’s massive. It’s not trivial
You can’t look at CPI and back it out
Basically since 1959 as I said, every decade is almost a doubling and the quantity of m2
So we think that’s a distorted unit of measure and therefore we try to back our way out of it to some extent you can’t
totally get away from
Using the fiat currency as the first unit of measure but what we do is we measure the market itself
against its own means its own averages long term all down the short-term and
To a large extent the changes in the moving averages of that given market while they are to some extent
influenced again by the money unit of measure
They’re more influenced by the movement in the underlying market whether to wrap it up those or a gradual up move
It will determine the rate of change in that moving average
so when we measure the market against its own means we come up with a different type of chart a
Momentum chart and we look for structure. Just like most price Chartists. Look at a price chart
They draw a trend line as the floors
Ceilings so forth and if they break didn’t it’s a violation of the structure so they make trend determinations based on these types of things
So if you’re voted the first set of charts, we’ve provided it’s the Dow Jones Industrials monthly price chart at the top
1926 to 1929 and below the price action is overlaid a 3/4 moving average
3/4 moving average is roughly similar to a 200-day average
Although the 200-day adjust every day the 3/4 only adjusts at the end of each quarter
But it’s about the same duration of
Maturity of an average. It’s pretty long-term as
You can see in the price action from 1926 to 29. The price action went up in a curve form unless arching upward
And it would have 10 15 percent pull backs in route
Some of the jobs look bigger later on in the trend that simply gives the price in risen
And then prior to the actual top and the down we got a congestion zone and early in 1929
From which a lot of people were selling and distributing getting out
Obviously, but then it broke through that zone and spiked up into the August high of 1929. Now if you look at the chart below
what that shows is the monthly bar price price action of the Dow in relation to
that 3/4 moving average
So friends is back in the early part of that chart in
1926 you were under the
3/4 moving average and emerged above it and
Ever since that point in time it to be the summer of 1926 through late 1929 the market lived above
The 3/4 moving average and momentum lived above the zero line
They were both in sync price and momentum in terms of producing higher highs during the uptrend
You can see it on both charts
But that changed in
The summer of 29 when we spiked the price up through that congestion zone and shot it up to 380 on the Dow
Momentum didn’t go back to the high. It made it. The monster believed lower high what’s called a non confirmation?
Well, a lot of confirmations are interesting and they’re often referenced by technicians of some momentum indicator doesn’t match the new price. I
And we we give some credence to them, but they’re generally what we call background features. They’re not necessarily immediately actionable
They’re just sort of a tap on the shoulder that something’s not quite right in this given market
It’s not confirming price strength is not being confirmed by the Momentum’s price
So after that period in August in September of 29 the market rollback over
price action came down to the top end of the prior trading range of early 1929 and
As soon as it sat on top of that old range
The momentum action dropped down to the 3/4 average for the fourth time in three years
In other words the market had been living above the mean
It returned to the mean three times
And so it almost became habitual there very comforting and reassuring that the market was going to stay on the positive end of that mean
So low down after three years of this behavior market participants were pretty pretty happy with what they’re seeing
But in early October 1929 the momentum action came down to that structure the zero line structured for the fourth time and
It did it from a non confirmed high and when it broke through in the early days of October
Excuse me about mid October of 29 it blew that structure out and the whole event was over with in a matter of days
Well, there was no time for committee meetings or debate the market had spoken it given you the structure if you were looking at momentum
Of course, most people weren’t at that time. They were looking at price
but momentum would have provided you with a clearer picture of
Vulnerable structure pending below the market too much used over three years
So the forth return to the mean did not return to the main it did what we call it
related to me and it did so
About us deeply below the mean is it had been above the me had a swing move to the downside?
Okay. Now let’s flip over to the next chart. This takes us to 1987 which happens to be a personal experience of mine
this five years later that I found at MSA based in partl impetus from Clegg what I learned in 87 and participated in
if you look at the price chart at the top, it looks similar to the 19 26 29 babble market and
Momentum below was matching the upside performance in the price action in words, every time price making the high momentum would agree
So they were happy travelers
Problem was again in the summer of 1987
the market surged to a new high came out of a congestion zone just like in 1929 and
Surged as if a whole new leg was commencing
The new leg ended abruptly you turn back down in September of 1987 and by early October
You again were hitting the zero line for the fourth eye in three and a half years
Three returns to the mean the fourth one didn’t hold and it was preceded by a non confirmation. So you had tap on the shoulder
Massive structure. That was super clear
Such comparable structure existed on the price chart
That you could look at and draw a line through four different flows from the end of the sort
It was an upward curving situation. So the price chart really didn’t give you any hint that
This down was going to be different than the other doubts
Momentum did and it was all over within days and again the swing to the downside of momentum
It was basically reflective reflective of the high readings on momentum that had preceded the collapse
Okay, now return to the third set of charts which is a bar chart format of the S&P 500
Today up to date going back to 9 2009
and below it is a momentum long-term momentum chart of
The S&P 500 but plotted not against the 3/4 average. This one’s plotted against the
36 month average to a much longer moving average. It’s effectively a three-year average
but we oscillate the momentum at against that and ever since it emerged above the
336 month average which occurred in 2010 in the early part of the recovery
The market lived above that 36 month average it retreated to it three times
In the 2011 summer fall 2011 we had the European debt crisis through sleep onset of it. We still have it
Side market sold off stopped at the 36 month average
The low monthly close was several percent above the sewer line. Then you started another leg up
Lasted until 2014 and 15
then we had that 2016 sell-off dropped down to what the 36 month average wouldn’t close a month below it and
It launched another up Lake
The other up leg lasted to 2018 you marginally
non confirmed in early 2018 on momentum versus the high readings we’ve seen in
2015 mister fairly marginal not a confirmation
And then you have a drop into mid
rally back up into the
September period of 2018 price there was making a new high September of 2018 versus the January
Hi 2018, but momentum
But momentum was not confirming that event but more grossly than had been the January high of 2018
The September hide was markedly lower on the momentum then was the January 2018. So you have non-confirmation
It was clear. Then you had effectively the little mini crash
Which MSA did call breaking down through 2900 and we projected it was going to go below 2400
It did have got down to the 36 month average again
And we’ve defined the number for that December break that we said if you touch this number you’re not even going to stop
Well, they stopped just in front of our number if there’s like 23 17 market stopped at 23 14
So basically it held visio line again and produced yet another wave up
This wave up was grossly non confirmed as well. This would be the highs. We’ve made over the last three or four months and
Now we’re starting to roll over yet again from yet another March new high that didn’t sustain
I want how many more marginal new highs you get before people finally give up on it
You know, it breaks out and doesn’t go anywhere but down
we’re now looking at the structure pending below that’s been used three times over a 10-year period
Good luck on the next trip down there
This is a much bigger structure
Than the three and three and a half year quarterly momentum structures of the Dow of 29 and the SP in 1987
But it says is that through a decade?
Investors have been placated by a market that only returns to its annual mean
It doesn’t penetrate collapse below. It holds around this annual me and goes for another run and so to some extent
What three years of comfort did to long back in 29 and 87 we’ve had 10 years of that
So I wonder there’s a lot of entrenched bulls out there who think it could go a lot forever. Well
Again, there’s been three hits on the zero line. Don’t do it a fourth time
Now let me turn to the next set of charts, yeah
Fourth set these are available to you on on the site
this is the same set of charts as were before the bar chart version of s P now in the
Bar chart of the momentum this time. It’s only in the monthly closing version
So we plot each monthly closing price in relation to 36 month average from the top chart
The bottom chart we plot each monthly close is a percent of Babur below the zero line to 36 month average
And of course, we’ve been living above the zero line since 2010
the red line on the chart
Slightly above its horizontal line slightly above the zero line and if you’ll note each of the low closing meetings monthly closes
2016 and December of last year
Halted at around three percent over the 36 month average
Perfect within a half percent each time never touching 2% over on a monthly close
But either side at 3%
so this oscillator shows the structure as being slightly above the zero light on a closing basis and
It’s produced on confirmations and it’s used that red line three times
So what we’re arguing is this is a massive potential breakdown structure
We happen to think and this is somewhat subjective on our part. It’s based on experience
We don’t think you better go down to even 2% over the 36 month average. Forget the zero line
We think if you go down to the red line on this momentum chart and drop below it 2% over
That it’s likely you don’t want to wait for the monthly close for proving thatis evidence at the end of the month
That month might be horrendous. So we see a pending structure here. It is massive like
has non confirmed has used the structure three times in a decade and
Is now leaning and not far away from the structure. So this month provided this number that
real vision video late July is
26 31 S&P cash
We think if you even trade that number this month, you better have your helmets on or parachutes on or whatever you want
You know
if you’re long
You better protect yourself you feel short that might be a place to add but right now we’re very number based
We want to see that number trigger
Touched that number will adjust felt next month because the 36 month average is rising these if you align is rising in price of gussied
Such the next month somewhere Bob’s on 26:50 will do the job
so we warned that all those people out there who think
The market is deserving of a correction
They’re probably right, but the problem is you can’t correct
Any perceived do the math to get the 26 31 or 2650 was not that big of a drop
It won’t stop there. So a correction will not be a correction that you’ve morph rapidly into something far more dramatic
Now another observation we’ve made recently aside from these thoughts on this long term momentum structure and the vulnerabilities
yes did alternative asset categories are speaking and some of them are speaking very loudly a lot of people have noticed for example that
the small caps the IWM, etf of the russell 2000 for example is
Underperforming the stock market the S&P 500 and it tends to when you look at a spread of
We don’t have a chart on this but if you look at the performance of the IWM in relation, Espie
You’ll see that in the up moves in the market over the last ten years
Generally, the small caps will tend to outperform in those up moves and when you get the down moves IWM will underperform the SP
The interesting thing is the IWM spread versus the SP is just blown out
All its oscillator lows all data to be spread short loads going back to 2008
So the small caps right now are speaking loudly
That they don’t trust the upside in the market for whatever reason now the fundamentalists can provide those reasons you can yourself
But we take take note of that so
Alternative subcategory of stocks is speaking negatively about the general direction in that direction of the SP
So far the SP hasn’t quite gotten the message, but sometimes it’s one of the stupidest markets out there
I’ve said before I repeat it
Now when you look over to other major asset categories Treasury bond futures, we look at the 30-year bonds
which were out of the reach of the Fed so we like the T bonds because they
Generally are moved by market forces not by overnight rates in the Fed
t bond futures turned up
We defined a turn up back in December at 141 on the T bond future and we thought I’d get up to maybe
160 and finally did we’re now in the mid-16th
But the interesting part of this and this is the last set of charts and they’re just price charts here
if you look at that t bond action, it went up gradually from late last year to
Four months ago, but then it started to go up at a steeper angle
In other words, it was no longer happy with an advance for the drop in yields. Didn’t want to go big-time
Rapidly, why?
What’s the big story stock market’s not collapsing yet?
We understand it when the stock market breaks often T bonds will rally sharply. They did in 87 at a huge move
The question is why are they doing it now? What are they anticipating?
And I think you can answer that question. We don’t need to but then you look at another one that’s gold and
despite the fact that the commodity asset category is still in a trading range and has been since
2016 roughly in a 20 point range on the Bloomberg commodity index
Oils under pressure now coppers under pressure grains are back in their base. Everything’s suppressed
And capped off. So there’s no real upside in the Bloomberg at the present time though. We think that’s likely to change very soon
How come golf is advancing in line with the tee box?
You know from last summer’s low in gold down at 11 60 gold advanced through the end of the year got up over
1213 and finally few months ago broke out over its price shelf in the mid 1,300 super excited most price charts
Momentum in Long says said be long and now both going up in an angle like this much like the teapot chart
They almost laid the two charts on top of each other again. Why?
What’s got gold? So irritated it’s not commodity price inflation at least yet
We think we’re in a situation very similar to what occurred in the late 1970s
Gold turned up first from a bear market low gone from two hundred at one hundred and three dollars and fifty cents August of 2006
1976 and turned off and it took about a year later for the commodity category join gold
But that’s when the big bull market in gold and commodities occurred
1977-78 through 1980 while stocks fly ordered in rural no-man’s land a wasteland for investors
But commodities took command
So that the liquidity provided by central banks?
Which is highly likely forthcoming, especially if the SP drops any more
The question is will it go back into stocks like it did in 2009?
Let’s talk from vastly oversold
Or well at this time goes somewhere else not where especially for the central banks weren’t to go namely commodity prices. That’s our expectation
We think gold is already leading the way but these two markets t bonds and gold
You should nail this chart to your trading room wall
And perhaps with the S&P chart upside down
Because we think these markets are speaking urgency
they’re now in an accelerated mode and I think they want to get to where they’re going rapidly and a hence to us that perhaps
The stock market’s going to do what it wants quickly now
I’m finished with my little little talk there and no doubt something like some of you have questions and I’ll take a few questions and
I need to click on a certain button here. I
Don’t see it I
Don’t see a red button in Oh
In stream in screen, huh? Oh, okay. This is not yet. You sure you want against rain? No, I don’t want industry
Well if end up yes
Yes, click on okay

31 thoughts on “🔴 Updating “The Biggest Trade of the Century” with Michael Oliver – Live Update”

  1. No we cannot restart the stream, but we are collecting all your questions and we will post the answers Mike provides here in the comments.

  2. I've been trading commodities living for the past 25 years, and Michael is one of a few people that I listen to. I'm still heavy long Silver, and wanted to know if your momentum still has silver heading to 21 fairly soon. Thanks

  3. Q: Price targets for gold and silver? Whats your momentum analysis on both?

    A: “Targets for gold/silver: Gold current target likely $1700 (could be congestive/correction en route); silver 19-21? Again, just the current move, not ultimate bull peaks which are not likely for another year or two.”

  4. Q: what are your downside targets for SPX if we lose 2600?

    A: “Downside target for S&P500 if 2% over 36-mo. engages? Under 1800.”

  5. Q: what do you think of bitcoin

    A: “Bitcoin should benefit from the environment of markets now. MSA was major bear in late 2017, turned bull again this past April (just above 5000). Positive trend now.”

  6. Q: hi mike, do your annual momentum structure breakdowns ever provide a false positive?

    A: “False signals from Momentum? yes sometimes, but usually only if the structure is somewhat less than clear. Larger the structure, clearer the structure (objective), usually signal then will be valid.”

  7. Q: Does this momentum strategy work for other tradeables than equities as well?

    A: “Momentum works well regardless of market – across the asset categories, that's why MSA covers all four major exchange traded categories: forex, debt, equities, commodities”

  8. Q: How can you be sure rally in gold is not a bear market rally and will end at 1700-1800$?

    A: "Structure for gold (positive long-term momentum) has been in basically two major phases, early 2016 and late 2018. Given that the structures were for annual momentum, likely will sustain for a few/several years. Yes, ultimately gold bull will cease, question is where and when. Not likely soon, not likely anywhere near current levels."

  9. Q: how about silver, will silver mirror gold or will silver do better/worse than gold in short/medium and long term?

    A: “Silver will likely do a "catch up" to gold and outperform on a percentage basis in coming months.”

  10. Q: How does oil perform in this crash?

    A: “Oil likely to bottom coincident with any dramatic S&P500 major low (which again we argue if triggered could be deep and rapid) but then expect oil's upturn to sustain (not for S&P) and drive a strong uptrend for oil. It has quarterly momentum structure overhead that justifies that conclusion. As for low in oil, suspect well back into $40s though not necessarily below the late 2018 selloff low.”

  11. Q: I've been trading commodities living for the past 25 years, and Michael is one of a few people that I listen to. I'm still heavy long Silver, and wanted to know if your momentum still has silver heading to 21 fairly soon. Thanks

    A: “Silver likely to reach into 20+ to 22 zone, but that will likely occur only when gold reaches $1700. Could be gold and silver "correction" prior to reaching that targets for this particular up leg. Such as gold congestion/correction in upper $1500s/silver near $19. Again, not a topping area, just a "mid-point" congestion zone. That's assuming something more dramatic does not engage them rapidly toward $1700 and low $20s (such as Dollar index drop below 96.55 – a major sell trigger – and S&P500 triggering a collapse by engaging its annual momentum trigger.”

  12. Q: based on your analysis, do you believe that gold (& silver) may sell off if stocks decline due to investors’ perceived need for liquidity, or is this time “different” because we are approaching the end of a massive structure (end of debt supercycle)? Thanks

    A: “Think that we are now in a late 1970s environment in which money is flowing out of stocks into gold and related. Hence more rapid drop in stocks likely to further boost gold/silver. Synchronicity between them ended in 2011 in our view. “

  13. Q: what specific BBB corporate bond etf / stock /index would you be short on e.g.which one is most likely to lose value in next crisis

  14. With the inevitable drop in general equities, how do you think the gold miners will fair? Would they rise with gold as investors move to the yellow metal and miners as a safe haven?

  15. there's only on chart that matters and that's interest rates and oil. the US "financial economy" was smashed to pieces last year "by the usual." now oil and interest rates are in a dramatic down cycle. certainly a "financial recession"(Knickerbocker Crisis) just as 2008…but no evidence of any broader impacts to the US economy writ large at all. In fact one could argue the exact opposite and be more right currently. debt continues to soar in value even today…and in particular US Treasuries. taint no shortage of Transfer Payments in the US economy obviously.

  16. Love what Real Vision is doing.
    Q: hello michael, what does your momentum analysis suggest the dollar is likely to do?
    Q: how does your longest-term, quarterly-momentum charts suggest the market will 'return to mean' – sharp, extended, average?

  17. If a person can not have something in their sight, that person has nothing! One quick observation before going forward, why is he blocking the window. Sunlight is a good source of Vitamin D. Onward, I guess! Establish a community of like-minded persons:religious or political or both! The uSA constitution was agreed to for some strange reason, think about that for maybe an hour! If the brain rot has not overwhelmed, think about the importance of what you do have. Is it worth defending? OK, if the $US is worth less than a stick of gum(ha ha), do es a person have 1)barter able skills, 2)ability to grow edible produce, raise a chicken, turkey*besides the one in mirror|, 3) give up on American medicine: nothing but part of the hoax. Remind oneself to look in mirror! 4) If what you buy at supermarket contains something unpronounceable. Do not contaminate oneself with it and it happened. YOU may not need to invest in lightbulbs. Just be more practical, and do not follow and throw you precious self to nonsense. If a person can not defend it, give it to whoever has the biggest weapon! Whew!

  18. what about cannabis market? it is not correlated to DOW or SPY, can it save those who do not want go all in gold? what about 5G- it is not a hoax. What is the ticker symbol for t-bonds?

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