Is the stock market about to have an explosive rally?

31 mar 2022

I think so…

Will keep this brief.

On the above 1-month chart:

1) Orange line = price of spot gold.

2) Candles = Dow Jones / Spot gold ratio

On the ratio it is very clear to see when the market is ‘risk on’ and ‘risk off’.

During ‘risk off’ Gold surges (purple lines) and risk assets plummet. Now look at he month candle on this ratio. This is a monthly Dragonfly DOJI candle. This is rocket fuel.

This candle is printing after a surge in gold price action with following distribution.

How to play it:

1) Be ‘risk on’, enjoy the ride.

2) When the orange line meets the candles, be in gold. Someone ask me below for an update. Am not always watching and if you’ve got free hours to spend then get in touch.

Good luck!

Ww

31 mar 2022

Commento

A comment below:

“but a lot/most/many people and others have been saying the opposite is going to happen - crash, major drop, correction”

Excellent point. The sentiment is very bearish. Everyone is talking crash. Sure it will happen, but not yet. How do I know?

Because dumb money hasn’t been this dumb since March 2020 when everyone believed the market was going to crash to its doom. Instead the market ripped 90% higher.

On the sentiment trader chart below the ratio of bears to bulls is shown. When the majority are bearish (now) the stock market rips and vice versa. Dumb retail money always gets it wrong.

Don’t be the crowd, be the contrarian.