See the fire is sweepin’
Our very street today
Burns like a red coal carpet
Mad bull lost its way
—Gimme Shelter, The Rolling Stones
The news breaks with the cycles and we certainly got big news over the weekend.
So let’s look at an a typical Presidential Cycle.
The Curse of Tippecanoe or Tecumseh’s Curse is an ‘urban legend’ dating back to President William Harrison and the 1811 Battle of Tippecanoe.
Allegedly, Harrison’s victory over the Shawnee and other tribes led to a curse being place on American presidents elected during a year that ends in ‘0’…in which they would die in office.
As a result of 4 year election cycle, that was a 20 Year Cycle.
When Harrison was elected President (1840) he died within weeks after taking office.
That 20 Year Cycle also timed the deaths of Lincoln, Garfield, McKinley, Harding, Roosevelt and Kennedy.
It also time the failed assassination attempt on Reagan. Reagan broke the curse and George W Bush reinforced that…but a cycle is still a cycle.
Similarly, a 40 Year Cycle timed the premature exits of Lincoln, McKinley, Roosevelt and the attempt to remove Reagan by force.
The latest phase in that 40 Year Cycle is 2020 and the election of Joe Biden.
Two things: will Biden leave office prematurely?
The attempt on former President Trumps life on Saturday raises the question of this cycle inasmuch as he is the leading contender and opens the question of whether he was actually the winner of the 2020 election.
A cycle like this could be fulfilled in many ways and the focus is “exiting the presidency”.
Be that as it may, many cycles point to the likelihood that Biden will not be the Democratic candidate in November 2024.
The 50 year Jubilee Cycle projected a Middle East War in late 2023 being 50 years from the 1973 Yom Kippur War and the premature exit of a president in 2024—50 years after Nixon resigned on August 8th, 1974. The DNC this August is in the midst of calls for Biden to drop out of race.
This Presidential Cycle dovetails with several other cycles in July.
In 1990 the SPX topped on July 16th at 369.78 dropping just over 20% to 294.51 on October 11, 1990.
Cycles show up in price and time.
Allow me to explain. The 369.78 to rhymes with the 381 DJIA closing high in September 1929 on Gann’s Master 60 Year Cycle (+ or – 1).
October 11 was the record high in 2007.
October 10th was the bear market low in 2002 following a Primary Low on July 24th 2002.
July 13-16th was a flat top in 2007. It was the Primary High prior to the Secondary High on October 11, 2007.
The high at the July 2007 top was 1555 mirroring the record top at 1553 on March 24th 2000.
The SPX dropped nearly 12% to 1370 in one month into August 16th, 2007 prior to marching back up to the nominal new high of 1576 on October 11, 2007.
From there the SPX collapsed to 839.80 into a Primary Low on October 10th.
Anniversary dates in July and October, 90 degrees apart clearly have exerted their influence in the 1990 and 2007 cycle 17 years apart.
17 years from July 2007 is July 2024.
17 years is the Locust Cycle, a Biblical cycle. It is half the 33/34 year lunar-solar cycle.
This is the time it takes for the moon and sun to align as they were at the beginning of the cycle.
This cycle is based on the Earth’s orbit around the Sun and the Moon’s orbit around the Earth.
This relates to Gann’s use of Eclipses and the geometry of the Vesica Pisces, the 3rd body formed by eclipses.
Interestingly, the attempt on Trump’s life on Saturday occurred approximately 90 days/degrees from the April 8th Great American Eclipse.
There was another mid-July to August plunge in 2015.
From a 2133 SPX high on July 20th, there was a Flash Crash to 1867 on August 24th.
August 24th, is the anniversary of the 1987 top.
On October 10th, 2018 the SPX commenced a crash into December 24th that would become known as the Christmas Crash.
October 10/11 is a big market pivot going back to 1929.
Although the top that year was on September 3rd, the DJIA dropped into October 4th where it staged a 5 day rally into October 11th.
From there the Great Crash commenced.
July 19th,1934 saw the start of a 5 day Flash Crash of 15%.
The major top in 1937 was on March 10th.
This is the anniversary of the NAZ top in 2000.
From July 18th 1933 the DJIA had a 3 Day Flash Crash of 23%.
On July 19th, 1934 was the start of a 5 day Flash Crash of 15%
You get the picture.
July is subject to Air Pocketism.
This may be one of the most important reports I’ve written because of the risk I see over the balance of 2024.
Because Real Risk is the risk you don’t see coming.
The market has lulled traders into a narrative that a summer rally will continue into the end of the summer, just as it did in the blow-offs in 1929 and 1987.
However, those blow-offs were 13 weeks.
This is the 13th week from the April low.
While the market seems as if its shrugged off every manner of technical warning such as a fleet of Hindenburg Omens and a slew of Key Reversal Days over recent months, that’s Mr. Market’s job number one—to deceive as many players as possible.
The market doesn’t turn until TIME is up.
Time turns trend. Not Price.
If the QQQ didn’t top last Wednesday, I believe it will this week.
The SPX struck a closing high last Wednesday as well.
It made a new intraday high on Friday and was destined for a new record close until the rug was pulled in the last half hour.
It was a real ‘Dundee’…”now that’s a knife” going into the weekend.
The SPX shed 36 points in 15 mins.
In so doing we got a Reverse Keyser Soze signal.
Why?
The SPX left a Key Reversal Day on Thursday.
On Friday it offset Thursday’s high triggering a Keyser Soze Reversal of a Reversal buy signal.
However in sliding back below Thursday’s high, the buy trigger for the presumed continuation move, the SPX flashed a REVERSE Keyser Soze signal…a sell signal.
Of course, as always, downside follow thru will be key over coming hours days.
Checking the hourlies shows the bearish reversal, a Soup Nazi sell, a new 20 hour high with a quick knife back down though the prior high within the 20 hour lookback (with at least a 4 hourly bars interval).
For the moment, this looks like a A B C pattern, with the initial drop being an A wave decline followed by the nominal new high B wave.
Consequently I am suspect of a rally attempt this morning as a C wave drop may be on the table.
That would project below the 20 hour mal which has acted as support for the last month.
IF the SPX wants to push higher this week then this presumed A B C will define a low.
Alternatively, breakage below the 50 hour ma with downside follow thru opens the door to confirming a top has been struck.
The first step to that would be a drop below the 20 day moving average at 5509.
This ties to the prior consolidation/breakout pivot from July 2nd (June 17 thru July 2nd flat).
In sum there is reason to believe this 5600 region struck last week is significant as 561 points to July 10th.
90 degrees down from Friday’s 5665 high is 5580.
180 degrees down is 5505 and the 20 day ma.
270 degrees down is 5432.
360 degrees down is 5358. The 50 day moving average is 5362.
Notice how the 180 and 360 degree squares line up with the 20 day and 50 day moving averages.
Importantly the 50 day moving average ties to the May 23rd high, a Key Reversal Day.
Breakage below the 50 day line that sticks adds to the weight of evidence that a major top has been struck.
In sum, the market may appear as if it’s on cruise control mirroring the blow-offs into late August 1987, early September 1929.
However, as noted above those were 13 week blow-offs and this is the 13th week from the April low.
As suggested several months ago, a mirror image foldback may be playing out with a panic into late August/early September.
At a minimum a sell-off should see the SPX drop to the 5260 region.
That’s only 7%, hardly a panic.
A panic points to the 4850 region. This is around a 15% decline.
I think there is a strong likelihood for the potential for a near 18- 20% drop.
This projects a test of the July 2023 top.
A mirror image foldback argues this could play out into early September.
That is a summer panic…just when the vast majority are convinced of a continued runaway rally.