THE END

I will be as clear as possible...

Keep in mind that I am a "PERMA BEAR" since 1999. Keep also in mind that for me, "the faith" of stocks is "written in the price behaviour  since the run from 1971 to 1999. "The end" of that run, at least for me, preceded another dark period for asset prices, which will last, at least, for as long as the Japanese devaluation which started around 1986 and, by the way, still not over...

"But how do we know when irrational exuberance has unduly escalated asset values, which then become subject of unexpected and prolonged contractions as they have in Japan over the past decade"

Alan Greenspan  December 5th, 1996

(Mr. I know what i did)    

When looking to the next (monthly) chart one should, without doubts, be worried. Even accepting this "sideways" trading since the dot.com burst ("The end"), one should keep in mind that each time market rallied in the last 12 years, it needed more stimulus and it climbed the wall of worries with each time less momentum and volume.

I see this as an huge opportunity, and these one, in my humble opinion, will be even bigger, faster and will go lower than the previous ones...

Anyway, lets concentrate ourselves in the trading issue. The two previous big tops were preceded with a stochastic bearish divergence, as the one that price looks to be drawing right now. The next time-frame I will look upon is going to define my trading bias. S&P500 is clearly under pressure bellow 1422. As a reminder, just take another look to the previous chart. There you can figure out where this next (weekly) chart might go in the next months...

For those with less patience, I will introduce another (short-term) idea. Hourly chart will provide me clues to know when and where to get in. First target around 1375 and the second is... Well, we will go back to these charts if price test 1375 or 1437...

Great top come always after greedy times. "No fear buyers" keep prices going higher until the "first one" stops to believe. On the other hand, big buying opportunities appear in panic times, after "everyone" sells their assets.

Bulls always believe market is going higher and Bears the opposite. I am a PERMA BEAR, but i also believes that markets tend to hurt the majority of the players. Are we in one of those euphoric or panic periods? Lets keep this information next to the rest...

After an historical view of prize paid for protection (known as VIX), when one can easily verify the periods of fear/panic just take a look to what one of the more oldest surveys says about investors sentiment...