Transcription
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, financial advice of any kind. Investing carries a high level of risk and the majority of retail clients lose money. Do not invest 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 this is the weekend's deep dive. On the weekend, we like to come back and reexamine the base case hypothesis of the channel and check to see if largely speaking things are still going according to plan. This just enables me to have a framework within which I can operate and justify my positions, live trades, and general posturing in the market. And as ever, when we get to the charts in the end, I'll show you all the live positions we got open and that kind of thing.
I'm not going to spend too much time today focusing on the macro data because most of the macro data I track and I believe to be significant for helping me be able to predict the overall trend in the market is just not being released anymore by the government, as I'm sure you're well aware. So, we'll talk briefly about that. But unfortunately, until such time as I get some new data, I can't really progress those components of this hypothesis.
So instead, what I want to do is point out a couple of things that I can see elsewhere in the market. I want to talk a little bit about a yield spread blowing out and what that could potentially mean, whether that's a risk-off indicator or some other stuff. I want to spend a little bit of time showing you how Bitcoin could be setting up to sweep its low just like it did in the last weekly cycle low. So I want to show you that because it's actually eerily similar to the prior time we did this. And it also solves a couple of problems that we've got in the structure of the market as well. So, I'll show you that as well. And other than that, we'll do what we always do, which is run through this thing from the top down and check to see if anything has been invalidated yet. So, be sure to hit that subscribe button so you can follow these in week in week out as we continue to progress through this hypothesis. And without further ado, let's dig in.
So, the base case for the stock market was at the lows. Everyone was too bearish. We're going to have a blow-off top to all-time highs, come tumbling down in a global bear market and recession. And we would, here's the key part, for a short period of time, slip into asset price deflation. Fast forward to today, and I still think we are well and truly in that blow-off top moment. There's a nice schematic here that I point to every week in which we get this first bear trap and then we go parabolic. And I've drawn the parallels to this first bear trap here being the tariff tantrum followed by this blow-off top moment. If we draw a line across the all-time highs, as I do every week, I'd still make the case we're somewhere around FOMO. If not already in FOMO, we're going to be in FOMO any day now. And so, of course, when we go back here, I think it's pretty easy to say there's the top. We had the tariff tantrum and then we recovered. And since then, we got to be at FOMO or close to FOMO.
My trend line trading system permits me to move this trend line to encompass the lowest low wick upon making a new price extreme, which so far we haven't actually got for the S&P. We have got it for the likes of the Dow. We have got it for the likes of the Russell. But I am actually not allowed within my system to do this just yet. Okay. So, once we make a new all-time high for the S&P, I can do this. And then we use this as our exit the market signal. But for now, until such time as we make a price extreme, I have to entertain this could be breakdown, retest, and resumption. It's not my base case, okay? But until the market shows me that that's absolutely not the case, then we have to be open to it.
Holistically speaking though, I would say this very much looks like a blow-off top and it looks remarkably similar to this having already been somewhere in this neighborhood in my humble opinion. So I think we can tick off the stocks and say we thought we'd get a blow-off top. We seem like we're well and truly in a blow-off top. And really our job now is if indeed we really are somewhere around this FOMO neighborhood to try to get out as close to the absolute top as possible. Okay. Now just because we've traced this schematic all the way to about here doesn't mean we have to go vertical from here. This may be enough to just start to distribute sideways from here and roll over. So I'm by no means saying that just because we've done all of this we have to do the final vertical bit. I'm simply saying that's my current lean until the market shows me something new.
I did want to show you this as well because one of the members put me on to this that the S&P is currently repeating its 1965 fractal eerily closely. Okay. And if so, then you can see we're right around here. We've probably got a little bit of a sell-off, one final marginal higher high and all this would be distribution followed by the bear market down into that four-year cycle low. So again, it's not my base case, but it's also not my job to try to say, well, I'm going to force my will on the market. Okay, if we are actually going to get trend line breakdowns, then I would rather be out here rather than being dogmatic and try to be buying every dip on the way down. So, I'm open to this and that's why we use the trend lines to keep us in. That's why we have a rule that enables me to move the trend line only under certain circumstances. And right now, as I said, they haven't been triggered. But all we need is a new price extreme, we can do this and encompass the lowest low and start to say, okay, so long as we're above support, long and strong and continuing to push. So, for the stock market, I'm going to say happy days. Okay, I think happy days for now at least until something changes.
For Bitcoin, we've been trading these weekly cycles, which are approximately every 30 to 31 weeks, we get a new weekly cycle low. And each one of these on average has yielded a 94 or 95% move from the low to the high in the weekly cycle. We did have to squish down this box a little bit because we got 69% this time around. And I think we have a good chance of being bottomed here. I'll show you the sweep of the low setup similar to what we did back here a bit later on in the episode. But so far so good, right? We're doing our best to confirm a weekly pivot. We're doing our best to cross bullish down on the breadth here. And if I am right in my expectations and this current weekly cycle is going to left translate, that means we've got to put in a peak sometime within 15 weeks of this low. 15 maybe 16 weeks. Okay, if it was 16, we could call this thing mid-translated. By extending this box out to the midpoint of this weekly cycle, we can see that gives us a deadline of around the first week of March, okay, to see a top, if not before then. But I still remain cautiously optimistic that we have got some degree of counter-trend bounce to continue here because so far we're only about 16% off of the weekly cycle low. So if we can push just a little bit higher, let's say 40% from the low to the high of the weekly cycle, that still puts us above 113K there or thereabouts, and that would still be indicative of waning momentum into these final couple of weekly cycles, okay? Where, you know, we went from doing practically doubles off of the lows to a 69% to a 40% to a lower high and rollover and then we can head for that four-year cycle low. But even that 40% which would be significantly below all of the prior ones, okay, that still gets us above 113K like I said. So I think it's premature to be exiting the market or being too bearish here.
If the low remains unswept, then we have to label this the cycle low and that gives us our cut-off point for the left translation around the first week of March. If we have to come and sweep the low in the next week or two like we did back here, okay, we had a low, we quickly swept it and then we go higher, we will have to label the new lower low as the weekly cycle. Okay, and then adjust all these boxes and that will maybe push us out to sometime around April or so for the ultimate top for the left translated cycle. And of course all this will have to be shoved over as well and would tell us to expect the four-year cycle slightly later in life. But at the moment I don't think we need to be entertaining such scenarios. I think for now that's the low until invalidated. Okay. And we are very, very close to crossing bullish here. So long as we can get a little bit more upside here. Okay. And then get out somewhere in this neighborhood before we head down for those next couple of weekly cycle lows. Again, I would take this one off and say cycles doing cycle things, right? All seems right with the world for now at least.
So as I said at the start, I believe sometime next year when we enter a global bear market and recession, we are going to for the third time in US history slip into a short period of asset price deflation. And this whole idea is based on the fact that anything you do to the MT rate of change shows up in the CPI with a lag since we had this violent snapback off the back of the C19 era and slipped negative down here. I have been hypothesizing we will do the same for inflation. You can see that it is well and truly disinflationary. Okay, I know a lot of people like to zoom in at the trueflation data for example, which is creeping up in the short term, but I still maintain this is a counter-trend bubble just like the one that came before it here that quickly resolved to the downside.
Now Cast has shown the inflation model has dropped off of a cliff for the last month or two and all at a time where suspiciously in my opinion we have now got inflation data not going to be released for the foreseeable future. As we do every week, we point at the facts that whilst people think inflation is sticky, okay, it's because shelter is being a problem child. And if we change the shelter component of CPI with a more real-time metric rather than a lagged one like shelter, you can see that we've been deflationary for well over 18 months now. Here's another look at it. Okay, if we swap the shelter component with the ALRI instead, we can see that we've been well below 2% inflation for many, many months. So, I know it's easy for investors to look at this and say, well, this is the resumption of inflation and the print to go burr and this is not going to stop and the bread in the supermarket is going to keep getting more expensive. But where it actually matters is the rate of change. We're not measuring absolute inflation here. We're measuring rate of change and the rate of change is heavily disinflationary and has not changed or has even gotten close to changing just yet. So I'm going to stick with this posture until invalidated of course which means I get to tick this one off as well and say so far so good there until something changes which brings me on to the next component of this hypothesis which is that if indeed next year is going to be a recession and if indeed we're going to have a global bear market and recession in the economy we would expect to see labor market deterioration synonymous with recessions.
For about the three-ish years that I have held this hypothesis and been doing these weekend updates, we have seen a slow but steady deterioration in the labor market. We can see the ADP report shows big losses for October. And again, we have more suspicious timing because the Fed is now losing the data or not going to release it or going to wait until January to release data that's 2 or 3 months old. So, it's incredibly challenging for me. I never saw this coming at all. This was never on my bingo card that we would get to this kind of inflection point where I should be just about to say either, oh, my idea is invalidated. We'll move on to another idea or here we go, we're confirming we've got recessionary jobs data. Looks like we're going to have to be extremely cautious heading into next year. We've gotten right to that inflection point and they've taken the data away. So, like I said, I never had that on my bingo card. I definitely didn't see this coming and I'm really not sure what to do about it apart from try to keep taking it one day at a time and keep an eye on these metrics as best we can. We also know again suspicious if you ask me they've done a whole heap of downward revisions to the jobs market and again similarly and on theme at the moment we're not going to be able to get our hands on any more of this jobs data for the foreseeable future. It might not be released until January and then in January, the last I checked, they are talking about releasing October and November's data in January, which will still leave us a few months behind the curve and kind of difficult to extrapolate out with any real degree of confidence. So, I personally find all of this to be very, very suspect, but to each their own, right? We each get to choose whether this is incompetence or chicanery.
When we look around at some of these big companies, okay, we can see that they are laying off employees at levels not seen since the GFC at a time when the Piper Sandler recession indicator is coiling to the upside. There are still areas to be concerned about because things like construction quits, which is a leading indicator, are also at levels not seen since the GFC. And the same is true of the total private quits, okay, again down at these recessionary thresholds, last seen in 2008. And the same for quits, total non-farm. So, we've got these recessionary looks in the labor market. The labor market does seem to be in accordance with this base case hypothesis, end of the bull phases of these four-year cycles. And the challenge remains because we have no updated data. This is the unemployment rate for the US. Again, we've long been talking about this steady but gradual decline in the health of the unemployment rate with unemployment being creeping up now in a steady uptrend relentlessly since about Q2 of 2023. Now, if we look back at the shaded areas on the screen, all prior instances of recession started with a leading phase before an accelerative pop to the upside. And again, it's difficult to make any conclusions here because we are working with data that only goes back to September. Okay, now yes, this looks like it goes up, but how bad is the hard right edge of this chart? We can't really say. We can only speculate that it's probably worse. Okay, I think if it wasn't worse, they probably would have just released the data to show that this thing had been rolling over and we're going to swerve a recession. But again, that is speculation because we don't have the data.
We can see the same pattern in the unemployment rate for 16 to 24 year olds. Again, showing a recessionary look here. It's highly susceptible to a big pop to the upside, synonymous with recessionary periods. The exact same thing is true of the U6 unemployment rate. Okay, starting to sweep to the upside before we enter some kind of recession. And the SAM recession rule was the one indicator that actually started to roll over and produce lower lows on the monthly time frame here. That was until we sailed past the 5th of December and again on the theme here still have not seen an updated data set since September's prints. So we have over doubled off of the lowest low of 0.1. Okay, we're now sitting at 0.23 for September. I again speculate this is probably much higher up in the real world than our current readout, but we can only speculate because we don't have the data. I think I can tick off the labor market deterioration and say yes, that trend is yet to reverse. That trend is yet to roll over. It still seems like we are well and truly trending towards recessionary jobs data and I suggest to you that it's probably worse than they're letting on. Otherwise, they would just give us the data. But at least for now, I think it's safe to say there's certainly no invalidations hit on that. And it doesn't look at all to me like based on the jobs data we're going to be swerving a recession.
Over in the world of rate cuts, we've just seen another 25 basis cut this week. And again, I'm here to tell you that whilst this looks like we are currently well in favor of a pause at the next FOMC meeting at the end of January, I actually think that this is just because the bond yields are backing up at the moment and once they're finished and rejected resistance and rolled over, we will see this thing reprice in this direction. Those of you that have followed me for a while will know I practically say this every time we get one of these and gradually we do seem to reprice so long as the bond market continues to do the rate setting of course and favors this kind of cut setup. So, it's still my current expectation that we'll be seeing more cuts in January. But, of course, it doesn't really matter what anyone thinks, says, or does. We just say on this channel, tell that to the bond market because it's the bond market in aggregate that determines rates.
Timing-wise, this gets even more interesting to me because when we are cutting into normalization, which is a return of inflation to baseline whilst avoiding recession, good things happen to the market walking forward. But if these are cuts into a recession, which I maintain they are because of the jobs, because of the yield curve inversion, which we'll get to in a bit, and because of the slowing we're seeing in various other places of the economy, historically, we can only get about 3 months into the future, okay, before bad things start to happen to the stock market. We had a bit of a strange cutting cycle this time because we saw the first cut in September followed immediately by many months of pauses. Since we are now resuming cuts and we are in this magical window of around three months, okay, if this really is a cut into a recession, then historically we should expect bearish outcomes walking forward.
All of this, of course, fits with the timing of the four-year cycle lows, which we know are due late 2026 for the S&P 500. It's also due late 2026 for Bitcoin. And believe it or not, gold, which has an 8-year cycle, has a half cycle low, aka its four-year cycle low, also synced up for the end of 2026. So, if we are about to experience some major tops in the not too distant future, we'll only be able to look back at this and say, well, yes, that's what normally happens. Nothing really out of the ordinary here.
There are currently no breakdowns, no technical breakdowns anywhere in the markets. There's currently no failed cycles anywhere in the markets and there's currently no trend reversals in the markets. So, by no means am I trying to jump in front of a train and stop it with my bare hands, okay? All the while we're clearly in established uptrends, then I will continue to remain long and postured long across the board. But we also have to be objective here and acknowledge that we have used up a great deal of the four-year cycle. Okay? And typically we spend about three years going up and one year going down. Now, of course, we can overrun by a few months. We could in theory overrun by six or nine months and then only spend six or three months in a bear market and a recession, but it is important to acknowledge the longer we go, the more seriously we have to take the declines that are expected to take place bottoming at the end of next year into those major four-year cycle lows.
We also can see we've got this have and have-not economy, right, where lots of people are scrambling to sell their house fast or give their car back. We're also seeing a whole heap of US bankruptcy filings, okay, spiking again to levels not seen since the C19 or GFC era. We got credit card delinquencies spiking to levels not seen since the GFC. The same is true of auto loan delinquencies and credit card delinquencies, too. As you can see, at levels exceeding the GFC, the dot-com bubble, and the C19 plunge. So whilst the rich keep getting richer under the hood, the have-nots are running out of money and are therefore going to be unable to stimulate the economy in any meaningful way. Again, all that time I might add, where we're seeing the labor market deterioration, we're getting very late in those cycles. We're probably overly restrictive. And now that we have started cutting rates at long last with any meaningful velocity, we are now entering those timing windows where the chickens should finally start to come home to roost. And again, all at a time where they will not give us the data. So make of that what you will. Maybe it's nothing. It's not really my job to try to be a doomsayer or a top caller or anything like this. My job is to simply stay long on the trend until it breaks. But I do think it's important to acknowledge these kind of things because it prevents us from being blindsided and getting too euphoric into the FOMO and euphoria part of the blow-off top.
Now, the last couple of things I like to check in on before we head into the charts and the positions on this deep dive are the high yield credit spreads, which I use as an alarm signal. Okay, when these high yield credit spreads blow out and move to the upside like this at the tariff tantrum or like this during the 2022 bear market or like this right here during the C19 plunge, historically that is synonymous with financially stressed conditions. Now, if we were to get breakdowns in the stock market and the stock market and Bitcoin start to fail cycles and stage trend reversals at a time when this thing is blowing to the upside, I have always used this as a confirmation signal that we have to be extremely careful and defensive and respect the breakdowns, right? That is not a buy the dip environment. You can buy the dip whilst the high yield credit is not blowing out, but as this starts to moon, we really don't want anything to do with buying the dip in the short term. Instead, we want to be defensive. We want to be sidelined, and we want to be waiting for momentum to return and the market to prove that it has found a bottom to us before hopping back on.
Now, at the moment, we certainly don't have any financially stressed indication down here from the high yield credit. So, I know what you're thinking. Happy days, right? Long and strong for a while longer. And that's partially true. Yes. But here's where things get interesting, okay? Because just like I use the high yield credit as alarm signals, I have also always used the 10-2 yield curve and the 10-year 3-month yield curve as alarm signals too. Now, the yield curves get a lot of bad rap because frankly, most people don't use them correctly. Right? When these things invert, everyone screams recession, and they're wrong. When they revert back above zero, everyone again screams recession. And again, they are wrong because it's actually the accelerative sweep to the upside that is synonymous with the tops coming in for the stock market. But when we put up an updated look at this chart for weeks, I have been saying that all the while we remain sideways or even down, we have not got to worry and we have no alarm signal here. Okay. But at this current moment in time, the 10-year 2-year is actually starting to break to new highs. If I zoom in here on the weekly time frame, this week's candle closed a weekly higher high above the prior highs from the meltdown when we had the tariff tantrum lows. Now, this for me historically has always been an alarm signal here that we are potentially at a lot of risk. Now, this could easily reverse next week or the week after, trade sideways for a while, it could easily pop a little bit higher, and then immediately reverse lower, okay? And none of that would actually be of any concern to me. But if this thing really starts to get going and accelerate here, I would only expect breakdowns in the stock market and other risk assets. And thus, I think we do need to actually take this very, very seriously. We really want to see this thing reverse ASAP. And it is important to note a couple of things here. It could well be that this is just a correction in the bond market, okay? And once the yields have finished backing up, the bonds will catch a bid. The yields will therefore come down and then this yield curve will straighten itself out a little bit. In which case, maybe this is actually not a problem. Maybe this is a false signal.
But things get even more concerning if I change the 2-year here to the 3-month yield spread, which historically is even sharper. Okay, it's even more of an alarming signal. You tend to have even less time to react when this thing blows out. And for weeks, we were talking about this compression in here and saying it's fine. All the while it goes going sideways. Okay, but we really did not want to see a weekly higher high close above these prior highs. However, that's exactly what we've got now. Right now, it is not occurring on any concerning price action here. The Russell 2K are making higher highs. The Bitcoin low remains unswept for now. This trend line break doesn't look like a true waterfall spill like the tariff tantrum or the yen carry trade unwind. So, I don't think we have to be too concerned here. Okay. But certainly if this upcoming week is a big red candle and that occurs against the backdrop of these yields continuing to break to the upside then I think we will have to acknowledge okay that a top has snuck up on us and we really need to get immediately defensive.
Now I also wanted to comment here and say it does seem a little bit too early for this to be occurring right it normally I wouldn't expect to see this unless something was brewing in the charts and something doesn't seem to be brewing yet. Okay, so things can change and they can change quickly. But this does seem premature, which makes me wonder if this is a false signal. But at the same time, the whole reason I use these kind of alarm signals is indeed to alert me to when things are about to go wrong. Okay, so we can't just ignore this and say, well, we we'll worry about it later. Okay, we do have to pay attention to this and this is concerning to me, especially if we can't undo some of this price action in the coming days and weeks. It is also of note that we of course were going to get the three-month yield drop to align with the cut that we saw this week at the FOMC. Okay. So, it's possible that that's all we're seeing a repricing to accommodate the rate cut and get the 3-month in line with the Fed funds rate. That's entirely possible. In which case, this really isn't as alarming as potentially I consider it to be. It may also just be cycles doing cycle things. Right?
For a long time on this channel, we've been pointing at TLT and saying that we are looking for a decline in TLT to hopefully come down and sweep all of these lows, reset the weekly cycle. This is a weekly time frame. So, I'll pull up the Breet. You can see, okay, couple more weeks to pull this down to oversold, reset the cycle, start a new one. Okay. And if we can get something like this yellow squiggle somewhere around this timing window here, sweep all of these lows. I've been talking for a long time about this being a fantastic opportunity for me to position myself in TLT. And this will represent my first truly defensive position ahead of what I believe of course will be a bear market and a recession next year with all those markets, the gold, the stocks, Bitcoin heading for their four-year cycle lows late 2026. So is it just cycles in control, right? Are we just in the middle of resetting the longer-term treasuries? Are we just getting the capitulation here in bonds, okay, which gives us the backup in yields once a few weeks has passed and this thing has reset itself? Do we then get the inverse appear? Do we then get a huge bid from bonds for the likes of the Camel crew here stepping in to buy the lows out of the weekly cycle whilst we see record capitulation? I'm sure we won't be the only guys stepping in in size here if this setup continues to play out. And of course, if we see bonds bid heavily like this, it's likely that is conducive to seeing some relief here. Okay, perhaps in this yield spread, I know there's a lot of ifs and buts. Okay, and if ifs and buts were beers and nuts, we could all have a party. And I know that's not very useful right now, but unfortunately, this is how markets are sometimes. We just have to keep taking this thing week in week out and checking on the markets and seeing what happens here. Okay, I've said a lot, so let me try to simplify this in a couple of sentences for you. I believe these alarm signals to be somewhat concerning at the moment, but that doesn't mean it's over right here, right now. If the stock market continues to morph into a blow-off top where we see FOMO and even euphoria, okay, then irrespective of what the alarm signals are letting us know, we can continue to ride the trades much, much higher. What I believe will be that final blow-off top moment. If however what we get over the next coming few weeks okay is a more distributive type top and a trend line breakdown okay a rollover some failed daily cycles a trend change in here then we would only expect these yield curves to continue to blow out and sweep to the upside we would only expect to see high yield credit continue to blow to the upside as well and all of this will be extremely obvious in hindsight.
So as for my current posturing and positioning I remain long and strong until such time as we start to actually get true breakdowns true rollovers true failed cycles I'm going to keep monitoring the alarm signal And so long as we continue to press to new highs, then I think we can continue to stay long. But of course, the later we go, the more cautious we're going to have to be here. And so with all that said, let's hop into some positions and live charts as always.
Okay, we've been calling for this pullback all week. And it seems like we're finally getting it right into a half cycle low window, no less. Okay, so today is day 14. We're looking for a half cycle low bounce sometime around day 18 to 20, and then we should be able to resume to the upside. Happy days there. The NASDAQ, very, very similar. We've been talking about this pullback for a week and a half now. We finally got it. Looks like it's time to just move a little bit lower and then head higher. The Dow Jones, however, look, moving to new highs, okay, which puts the second scenario on the table, which is that we're going to break out through the all-time high, come back to retest it, and then go. And that's exactly what we've been seeing from the Russell 2K, the breakout above the highs, okay, the pullback to retest the all-time highs and then off we go. So again, happy days there, right? And despite all of the fear, uncertainty, and doubt out there at the moment, the VIX doesn't look anything like the tariff tantrum. Doesn't look anything like the yen carry trade unwind. Now, it can change and it can change quickly, okay? And maybe we're about to get a pop as we go into next week. But for now, it hasn't changed, okay? It hasn't gotten to the point where people are seriously concerned at the moment. There doesn't seem to be a great deal of fear in the market. And so maybe, just maybe, 10-year, 3-month yield spreads blowing out are really just a bit of jiggery pokery in the bond market whilst the yields re-equilibrate following the Fed funds rate cut.
But gold, gold continues to push higher out of another daily cycle low here as does silver and we continue to be positioned via that in the level three member section via a whole heap of these mining ETFs and individual mining stocks and happy days there. Right. So long and strong continuing to push but also being mindful here that we are due a weekly cycle top sometime before about the second week of March. Okay, so anytime between now and March would be the perfect place to see a top for the metals and the miners and then start to actually head down for those major four-year cycle lows. Here's gold's. Okay, something like this perhaps. Okay, move up higher. Weekly cycle low, left trans failure, half cycle low, aka the four-year cycle low, record printing, off we go to the moon and beyond along with everything else.
For Bitcoin, we're still operating with the assumption the low is in. Although we haven't confirmed it on the weekly time frame with a trend line break, and neither have we got the breadth cross here on the weekly time frame either, although we're getting closer and closer every single week. Now, I did want to show you one other scenario that I've been entertaining here. And that is that the low is not yet in and we're going to sweep it one final time just like we did back here. Invert in the daily cycle and then off we go. Now, if I go back to the daily time frame, this will solve a couple of issues. Okay, number one, the daily breadth is trending down. Okay, so we need to reset this thing before we could probably move higher. But if we go back to the prior weekly cycle, we had quite a similar deal. We put in the low, we started to rally and then we got the breadth cross bearish and head down. Okay. And it wasn't until we'd inverted and just briefly swept the low into the weekly cycle low with the inverted daily cycle. That's when we could reset the daily time frame and of course the weekly at the same time. And then we could have a big rally thereafter. Now, if I copy all of this and drag this thing across, this may well be on the table. Okay. Now, we don't have to sweep the low. I just it's Bitcoin so can't rule it out. But I was also thinking this would be absolutely max pain. Like there's no way anyone other than cycle traders could tolerate this kind of price action and remain bullish here. There's just absolutely no way anyone can, right? Only the cycle traders can say, "Oh yeah, we're just inverting that whilst we reset this, whilst we then get ready to confirm the weekly time frame cross and a trend line break, right?" Only cycle traders can say that. Everyone else's system basically has to take them out of the trade here and get super bearish and call that thing a bear flag. So, I was thinking about this like, yeah, well, that's exactly what happened here, right? And everyone got really mad and everyone said we were cheating the system and all that other stuff. And I was making live streams literally right here saying, "Please don't quit the space." And I just kind of think it looks a lot like that's what's going on here. And like I said, it does reconcile the breadth needing to reset down the bottom. And you know what else it reconciles here? It reconciles that you can't count five down and it doesn't look like an ABC into the low. But if this whole thing is 1, 2, 3, this is four and then five just to sweep the low. That gives us a much cleaner count on the way down from the Elliot system. And therefore, it reconciles that the fact that we cannot count five down either here. And the ABC just looks too janky. Okay. So, we don't have to necessarily sweep the low. And ordinarily, if it wasn't Bitcoin, I would say we probably won't sweep the low. Okay, on a balance of probabilities, we'll still stay with this as the current daily cycle and it won't fail. But just because it's Bitcoin and we've done it so many times in this prior cycle, okay, not only did we do it here, but if we go back here, we did the same thing, right? Daily cycle inversion day 30, swept the low and then went off. We did a reasonably similar thing here. You know, we printed a 63 low here and then inverted, swept that low into the weekly cycle before going. And we even saw a similar fake-out failed cycle thing here, right? Bear market low. We counter-trend rally, come down, sweep that low briefly, and then begin the new cycle. So, if it was any asset other than Bitcoin, I probably wouldn't be calling for this, right? But it just looks, like I said, especially with that fractal, an awful lot like we could well be doing something like this. And how many people would realistically be able to stay bullish here? I don't think hardly anyone. In fact, I think people will come out of the woodwork and scream and jump up and down and call me a fraud and a scammer and a grifter as I continue to buy this low in size. I think that's most likely what's going to happen, just because that's what happened there and there as well. Okay, so I've been prepping members for this. In last weekend's members video, I said if we have to come and sweep the lows in some of these crypto stocks, I don't want people to get disheartened. In fact, I want them to be prepared for that mentally because it's always easy to say you're going to buy the blood and the fear, but when it actually happens, it's much harder to do it than it is to say it. Especially in real time with all the bearishness and narratives and fear that will be out there as it occurs. Right? So, we have been preparing to buy a sweep of the low if it should occur. And again, it doesn't have to occur. There's some stocks like Wolf, for example, which I don't think this thing's going to sweep the low from here, to be honest. It seems weird that it would come all the way down and sweep this low. So, I think for Wolf, the low probably holds. I think the same is true of Hut as well. I seriously don't think Hut is going to come all the way back down and sweep the low, but some of the other ones look a little bit susceptible to it, right? Like Riot here looks like it could potentially sweep the low. Marathon looks like it could pretty easily sweep the low from here. And again, it kind of resolves the fact that is this ABC to here? I don't think so. Or is it 1, 2, 3, 4, 5 just to complete the pattern and then we can go. And again, how many people are going to want to buy that? I don't not that many in my humble opinion. So again, I'm open to this. It's not a quarter prediction, right? I I really don't care. If we hold the low and then break out, fine. And if we sweep the low and then break out again, fine. In either case, I don't really care. All I really care about is can we get this big push from here? And then again, look at the timing if we're to do this. Okay, this would be, you know, just about making new highs by the end of March. Very much in alignment with the S&P kind of timing window, the metals timing window, right? Everything is synced up here for kind of a pretty nice rip into the year-end and into Q1. And then we really are going to have to come down and target these four-year cycle lows.
For people that are saying it's just unrealistic to expect a move like that, I really don't think it is. If we just take this fractal from back here and put it here, okay, it could easily be this. In which case, we get to brand new highs of 135K by the 3rd of March. I don't think that's unrealistic. I think that's exactly what Bitcoin did in the prior weekly cycles, you know. So, I mean, to each their own. We each get to choose. Nobody has to subscribe to this idea. I'm just presenting the way I see the market. I'm just telling you what the cycles are kind of suggesting and hinting at. If we break out, fine. Then we can say with certainty, we're not coming back below that low unless we've got actual failure and have to exit the market on a sweep. And of course, if we do break out from here bullishly above the trend line, then we will set this as our exit the market signal so we don't have to wait for a failed cycle to exit down here at 79K or whatever. Instead, we'll exit as the trend line breaks. But again, if it's going to sweep the low just like it did back here, what will we be able to say? Like, oh, we couldn't have possibly seen that coming or oh yeah, it's doing the exact same thing it did in both the prior weekly cycles and the one two weekly cycles before that and the one before that. You know, it's just that's what it is, right? It is what it is. It's not going to be nice. It's going to feel like the end of the world here for sure. No one's going to want to buy it. And again, people are going to come out and call me a scammer and a grifter for buying it. And it is what it is, right? That's what they do every time. Cycles doing cycle things. So, we'll see if we can get it right. And again, I want to be really clear. We don't have to sweep the low. We could easily break out next week. We have no idea. Okay? But we can say objectively, we have not yet left behind a confirmed weekly cycle low because we haven't none of the confirmation signals. No trend line break, no weekly breadth cross, no close above the 10-period moving average. Okay? But week by week, we are improving here subtly. Okay? We do have a little bit of a swing in the making here. All it takes is one of those confirmation signals to fire and we can say happy days there. So, it's definitely going to be an interesting couple of weeks. I think my read on the stocks, Bitcoin, gold, I think that's all well and good. I think the positions to be long across the board there and playing the higher beta assets like the crypto stocks and the crypto miners, excuse me, the gold and silver miners as well. I think all of that is justified, right? I also think it's perfectly justified to say we're pretty late in the four-year cycle, but there's no reason to be exiting the market right here, right now. I also think it's justified to say the labor market is trending towards recession and that the Fed is still behind the curve because of inflation. So I think the whole base case hypothesis is still very much intact. There's not too many alarm signals out there. Okay, we don't have any real breakdowns, any real trend changes and the high yield credit is not blowing out, but we have got some jiggery pokery going on in the yield spreads and the yield curves. So we do have to keep an eye on that. Again, it could just be reaching an equilibrium following the Fed funds rate cut. And that's why it will be important to continue to take this thing one day at a time. Continue to observe and reassess this base case hypothesis week in week out so that we can check to see if any invalidations occur. And other than that, if you made it this far, do consider subscribing. If you want to get started with all things cycles, click the link in the middle of the screen here in about 10 seconds. And other than that, have a fantastic weekend. I'm your boy Camel. Until next time, take care from me. All the best. Cheers. Bye. Rocking the market with his contrarian screams like a pro. No fear, no shame. Sticking to his guns in his money game. He's a bad ass. Oh yes indeed. Camel Finance got the key on the bumpy ride.