Cycles bottom into FOMC

0:00 Yeah. Warning. This video and all other videos on this channel are for entertainment purposes only. The content of this video and all other videos on this channel are opinions of the creator only and do not constitute legal, trading, investment, or financial advice of any kind. Investing carries a high level of risk and the majority of retail clients lose money. Do not invest in anything happen unless you understand risk and you are prepared to lose it all. All right. Hello and welcome to Camel Finance. I'm your boy Camel and I want to show you that there's a lot of complexity in the system which makes today and the market situation very very interesting and at

0:46 the same time the cycles are due to bottom between now and early next week. Okay, there's also FOMC next week, which means whilst everything is quite complex out there and there's a lot of conflicting data, this whole thing should be resolved by next week. Okay? And we just have to get through next week, find some lows, we can set new invalidations, we can move on and we will have a very clear read on the market going forward. It will be very obvious what is going on for the months to come. And I would think that what I'm about to show you with the conflicting data should soon resolve. Okay, so let me show you what I'm looking at at the moment. First of all, to kick things off with the complexity, we have 99% probability of no rate cut this month for FOMC. And that actually makes total sense if you think about it because the 10-year yields have staged this massive counter trend rally here. Now, I still

1:32 maintain it's a counter trend rally. It's still a lower high for now. Okay, it's still nowhere near the kind of invalidation level at 4.4 we've been talking about. But this is the first sign of complexity here. Okay, the yields are pushing higher like this because bonds are being sold off. Bonds are being sold off because the government is at war at the moment, right? Not many people are super interested in holding government debt when they're in the middle of a war and there's uncertainty in the situation, the macro backdrop and the geopolitics. But at the same time, as we got this massive move in yields, you'd be saying, well, does that mean the metals are getting crushed normally? Of course, big move up in yields is bearish metals. And the inverse is true, right? When yields come off strongly, metals usually do very well. But when we go over to the metals, okay, more complexity, not really reacting at all. They don't seem to care. Metals don't seem to believe the yields situation. So, that's another

2:17 point of interest here. Again, it's complexity because this is not what you'd expect to see. It's also of note here. We're right in the middle of this daily cycle low window for the precious metal market. And we've got no true low at the moment, right? No sign of a lower low. So, does this mean, and I think it does, that we're going to extend this daily cycle by a few days here, run into next week, and find a major swing pivot low and a daily cycle low early next week in sync with the stock market. I think that's what it means. I think that's all that's happening here. So, I'm expecting maybe a few more days of downside here to undercut these lows, print a daily cycle low in line with the stock markets next week and probably around the FOMC date and then I think we can get our resolution from here. Okay, but more complexity cuz where's the cycle low, right? I mean, it could form timing base, but that's pretty rare. It's not usually the thing you want to

3:03 bet on. Again, complexity in two forms here. One, because we're absent of a clear V-shaped pivot, aren't we? A swing low. And two, the metals, like I said, just don't believe that this is a real move. Now, at the same time, when we're talking about complexity in the system, going all the way back to this time frame here, I was saying that the blowoff top was still well and truly in session. We're still going vertical, okay? But we had to be open to this sneaky distributive type top. Three whole months later, we have built out and painted this rounding top structure, which is inherently bearish. If I turn all of this stuff off, okay, and invert this chart, this looks exactly like a bottom formation. Now, it's upside down, doesn't it? which of course means this looks exactly like a topping structure. It's also just a couple of points away now. We're talking 2% or so of weekly

3:50 cycle failure. And this of course is late in the fourear cycles as I've been talking about over and over and over again. So on the one hand, we can say going back a few months ago, we were saying we should be open to this kind of sneaky distributive type top. And now 3 months later, it actually looks like this is absolutely got to be the base case. Okay, it it doesn't look like a blowoff top anymore, does it? It looks like we really did kind of quietly round and go down. But here's where I would suggest to you there's even more complexity in the system because given the macro backdrop, given the uncertainty out there at the moment, given all the reason to be bearish, given the amount of bears that there are out there at the moment, the absolute truth and fact of the matter is the stock market is less than 5% off its all-time high. So, we're not even close to correction territory yet. And you've got to be thinking whilst this looks

4:37 very bearish, okay, whilst this is rounded, whilst the cycles are failing, whilst we are very close to weekly cycle failure, whilst we are very close to four year cycle low decline territory, the absolute truth of the matter is given everything that's going on at the moment, the macro is really bad, the jobs are bad, there's the oil and Iran situation, the stock market can't even get down 5% from its all-time high. Okay, that's remarkable strength. And it gets even more complex here because when we look at the leaders like the Mag 7, these are absolutely topping, right? This is a topping structure. They are breaking down as well. They are leading to the downside. Many of the MAG 7, this is the change percentage versus their 52- week highs, okay? Are hugely off their all-time highs. And of course, all this fits with Bitcoin, which has been leading the top since October of last

5:24 year and is 50 odd% off of its all-time highs. But then we can add even more complexity here, can't we? Because whilst all that looks extremely bearish, whilst it looks like the leaders are leading to the downside, the stocks are rounding and ready to roll over and all that kind of stuff, at the same time, we've observed huge relative strength since the lows here in the leaders in Bitcoin, in software. Nothing at all what you'd expect to see if we were actually going to have a big crash. And to kind of illustrate this point a little bit further here, okay, if we do a fractal on the stock market of this whole setup here, okay, you'll see that in terms of time, very similar to this, right? Doesn't take long. We kind of have this pop, a higher high, and then we spill. Same as back here, and then at this hard right edge, okay, weeks and weeks and weeks have gone by, and we

6:09 just haven't been able to even get below those lows, right? So, this has taken way longer. To date, we're hund and something trading sessions, which is around double the amount of time that the prior tops took. So, we have been ranging for twice as long as a typical sneaky distributive type top would take here. And we still, as I said earlier, can't get more than 5% off the all-time high. And then the last thing I wanted to point out here is the VIX, okay? Because take a look at this creeping and creeping and creeping. But of course, we know that we're due for the daily cycle lows in the stock market early next week alongside FOMC, which means regardless of what happens in FOMC, it doesn't matter what's said or what shows up or what doesn't show up, we are due to find a low and get at least some short-term relief for a week or so thereafter, which would potentially fit with a little bit more grind and then finally

6:56 volatility returning to normal. But at the same time, these leadin phases like this often precede massive moves to the upside. So the volatility index, the fear gauge is saying that it thinks uncertainty is around the corner. It thinks that downside protection should be more expensive than it's been for a very long time. And yet the stock market cannot crash for some reason, right? It has remarkable strength. And even though it is now rounding and moving to the downside, it's doing so into a daily cycle low window. We've got the yield staging this big push, but none of the other markets believe it, especially not the precious metal markets. Bitcoin has found quite strong support down in this 60 to 70k neighborhood and is potentially even thinking about staging a bit more of upside here into perhaps an 80Kish retest. And yet all you can see out there in the wider market is the

7:42 entirety of this space only paying attention to oil, which continues to kind of hug this trend line and move on its way to what I suspect will be a lower high, but that's to be determined. And under the hood for the stocks, for the first time in more than 30 years, the financials have corrected while the S&P 500 wasn't even in a pullback yet. Okay, again, super rare. Do you see how complex these systems are? Do you see how much confusion and uncertainty and indecision there is in the market at the moment? This is an extremely rare setup here. And to show you just how unique this current setup is, we've even got some of the most shameless structural manipulation of a major index ever seen. SpaceX is preparing what could be the largest IPO in history. But the NASDAQ wants the listing so badly, they're literally changing how the NASDAQ 100 works. Back in February, they published

8:28 a consultation proposing sweeping changes of how companies enter the index. So, a new fast entry rule would let any newly listed company whose market cap ranks in the top 40 of the current NASDAQ 100 members get added to the index after just 15 trading days. No seasoning period, no liquidity requirements, completely exempt from the standards every other company in the index had to meet. Currently, new public companies typically wait up to a year before they're eligible for major index inclusion. That waiting period exists for a reason. It lets the market establish real price discovery. It protects passive investors from being forced into untested, illlquid stocks. And the NASDAQ wants to throw all of that out for one listing. But this rule gets even worse. Okay, the real scandal is the 5x float multiplier. Right now,

9:13 if only 5% of a company's shares are available for public trading, the index weights you at 5% of total market cap. That's common sense. You wait a company based on what investors can actually buy. The NASDAQ's current methodology already uses total cap rather than free float for waiting. But for very lowflat stocks, they at least had a 10% minimum float threshold. Under the new proposal, however, that threshold disappears entirely. Instead, any stock with less than 20% free float gets weighted at five times its actual float percentage capped at 100%. So, you do the maths. That means if SpaceX IPOs at 1.75 trillion and floats 5% of its shares, there will be roughly 87.5 billion worth of stock available for public trading. Under NASDAQ's proposed 5x multiplier,

9:59 the index would weigh SpaceX at 25% of its total market cap. That means passive funds would be forced to buy SpaceX as if it were valued at 437 12 billion. But only 87 12 billion of stock would actually exist in the market. You are forcing hundreds of billions in passive buying into an 87.5 billion float. Meaning every single passive vehicle tracking the index would be required to buy SpaceX at whatever price the market dictates on day 15. With zero price discovery, zero track record as a public company, and a float so thin you could read through it. Keep in mind the passive bid from index funds pushes stock prices higher. The higher prices benefit exactly one group of people, the insiders and early investors that own 95% of the shares. And when

10:45 that lock up period expires 90 to 180 days later, those insiders sell into the artificially inflated passive beard. Your 401k is the exit liquidity. The two long didn't read is in 45 years in this business. George Noble here has watched Wall Street find creative new ways to separate retail investors from their money in every cycle. But usually they at least try to be subtle about it. Not this time. Okay, this one they simply call a consultation. My take on this is that they're using Elon's notoriety. They're using his cult following, an entire generation of Tik Tok investors, to hype and pump this stock so that the big boys can use people's pension funds as their exit liquidity. It sounds kind of sinister and by all means tell me what I'm missing in the comment section, but I absolutely think that's what's

11:30 going on here. And if we assume that's even half correct, it's something akin to that. Then we look back through everything we've been talking about today, we can simply say that something insane is coming here. Okay? Now, I don't know if it's as simple as this bare market decline. Okay, the topping structure here. Maybe we get a little bit if I draw a more accurate squiggle, okay, daily cycle low, something like this, then down into a weekly cycle low, and then we go from there. Okay, or another scenario I think we have to be on the table for here just because of the relative strength we're seeing. Maybe we get rotation back. Maybe the things like the MAGS ETF here actually turns this into a fake breakdown topping structure and rips to the upside. Maybe what happens is most of these then come back to test their highs or even exceed them all at a time. I might add, where perhaps Bitcoin can get a nice big pump here to something like this before then topping down into the 4-year cycle low

12:17 against the backdrop perhaps of the yields finally saying, "Oh, okay. This was a bit overdone. Okay, down we go." Tell that to the bond market. Finally, then we can put cuts back on the table and all at a time, I might add, where oil eventually creeps its way up here to a lower high before the straight of hormers is reopened and this whole thing goes away and all of the online experts in the oil situation will have to go and find another situation to be an expert in and monitor. So, I can absolutely see the case in both directions here. I could see all of this being swept under the rug in no time. I could see us forcing an early low in here and having a good chance at getting a big bid into the middle of the year before then coming tumbling down. But equally, if the current situation keeps deteriorating, if there is nothing to this whole SpaceX being the exit liquidity pump thing, if the financials selling off really don't matter, and if

13:03 this really is leadership to the downside, then I could absolutely see the case where we find ourselves in a bare market very, very quickly. This really was one of those sneaky distribution tops. And all that will be left to pump in the coming weeks really is the precious metals perhaps. So things could really go either way. Like I was saying at the start of this episode, the nice thing about this situation is this complexity will be resolved, right? We're not just going to continue to progress through the rest of this year with all of this craziness going on and all of these charts pointing in the wrong directions, right? Or at least conflicting each other would be a more accurate way to describe it. By the time we get to next week, we will find some daily cycle lows, not just in the stocks, but also in the precious metals. Okay, they're due. They're probably going to be a few days late by the time we get to next week. Bitcoin as well is not that far away from its daily cycle low window, right? Day 35. So,

13:49 we'd expect a top maybe day 45, assuming that's not it already, and then down to a cycle low sometime early April. And then because the cycles are pointing up thereafter, doesn't it only seem reasonable to see the yields continue to the downside and this oil thing finally vanish? I think a lot of this makes sense. But with all that said, I do want to emphasize the following point here. Okay, it is not my job to try to guess or predict what is going to happen. It is my job to allow the cycles to guide us. And that's all I'm planning on doing. So at the moment we don't have weekly cycle failure which means we don't have to lean super bearish into the middle of the year. That could obviously change in as little as one or two candles here once this daily cycle though is in. We will fact of the matter have used up about 17 weeks of the current weekly cycle. Okay, which tells us on a balance of probabilities to expect left translation and failure out

14:36 of this daily cycle low even if there is a good bounce first. And again invalidation still sits above new highs, right? The metals are close to being able to give us a big level to choke stops up and use as bull market invalidation here. Okay, once this daily cycle low is in that level, those daily cycle lows become bull market invalidation. Okay, so either we get this to new highs or instead we get a daily cycle low that left translates and fails. If it fails, then we cut all trades, lock in all the gains we've had and we say, "Okay, fine. We did very very well in this market to get in near enough the bottom to call it the bottom and get out near enough the top to call it the top whilst pushing the trade until it become totally unreasonable to do so. And then for Bitcoin, I still kind of think that if we're lucky, we get a retest of 80 85k at the most and then there'll be a chance to lighten up spot if you want to before we head down to some 4-year lows and some weekly

15:21 pivots. Otherwise, I think it's just a case of sitting back and letting this market do whatever it's going to do. I am still in the camp of people that say this is a knee-jerk reaction and looking at the way the metals are behaving and the stocks, the other markets don't believe this move. Okay? And I think that's of note. So, by all means, disregard that information, but I think that's of note and the invalidation level remains the same. I also do see a lot of people out there calling for emergency or surprise rate cut at this FOMC. I think it's pretty safe to say based on the CME numbers and based on this, okay, that seems nearly impossible. Now, anything and everything is on the table all of the time. The Fed could of course just say, "Well, we want to cut rates." But I think you really do have less than 1% probability of seeing an emergency or surprise rate cut at the FOMC just based on the bond futures and

16:07 the yields. And that's why we say tell that to the bond market. So, I know there's a lot of people pushing surprise rate cuts. I'm just here to tell you I don't think that is the smart bet given the yield situation and the bond futures here. So, as we head into next week, just be open to everything. As always, understand there's going to be some cycle lows. There's going to be some short-term trades that we can take, but do keep that risk managed. That's imperative. Expect a lot of chop and games and volatility. Have some flexibility to allow a few days of wiggle room. Okay? I don't want to hear anyone saying, "Oh, you said it would bounce straight out of FOMC." I never said that. I said the cycles are bottoming into FOMC, but we have to allow one or two days of wiggle room. And that's always the case. Okay? So, again, be flexible with that timeline by a few days. And other than that, we can finally get some answers. I believe these markets are soon to resolve. I

16:52 believe we're not going to have as many conflicting market signals as we've got in the next week. I believe these are going to start to iron themselves out. I believe the markets that are lying, such as what I'm suggesting to you is oil and the 10-year yield are going to reveal to everyone else they're lying. And of course, if I'm wrong, then they're going to invalidate me on that and the other markets that I don't suspect are lying, like the stocks and gold and Bitcoin, they will very rapidly change their course. Okay? So, in either case, we're going to get a solution, but we just have to kind of sit here and be open to taking it one day at a time. In the meantime, if you want to fill your time up constructively by learning how to trade cycles, click here in about 10 seconds. Otherwise, I'll see you tomorrow for the weekend's deep dive and the level three members video slice crew will get a Q&A video as soon as I'm done posting this one. Until then, have a great weekend. All the best from me. Cheers. Bye.

17:45 >> Tra, no fear, no shame. sticking to his guns in his money game. He's a bad ass. Oh yes indeed. Camel finance key ride.