Think Big With ETFs

I have barely had any time to go through the absolute smorgasbord of wonder from Friday’s plunge, but I at least made my way through the ETF charts, and my jaw is hanging open.

For one thing, the interest-sensitive leaders (high yield, junk bonds, corporate bonds) that are going to lead equities into the pits of hell are not even bothering to have a tiny bounce-back. They are simply crumbling to new lows.

I was originally going to mark up these charts with plunging arrows, but I’ll leave it to your imagination and just say a few words about each one.

Below are emerging markets, which have been in a bear market for way more than a year (unlike our own U.S. stocks, which haven’t woken up to smell the coffee yet). The next step here is to cut through that major supporting trendline and make its way to the next Fibonacci retracement level just above 36.

The worldwide equities are absolutely poised to plunge, and the next logical move here would be to slice through the lows of 2022 and make their way toward 58.

I don’t have a specific target in mind for small-caps, even short-term, but if we break 2022 lows, hell is going to break loose because it’s as clear as a mountain lake that this is a very range-bound creature, and a failure of that range will cause an explosive lack of bids.

Although it’s almost tick-for-tick the same as EFA, the fund IEFA sports a sensational rounded top and a target price just above 59.

And tech, as my premium members know, I think is going to batter down to about 250.

The SPY is an absolute spectacle thanks to the Fed’s ceaseless attempts to prop it up. That’s why it’s so hard to read and lacks the smoothness of other funds. All the same, that thick blue line is key support, and a genuine failure thereof would set us on a course to about 375.

In sharp contrast to the distorted SPY, the industrial XLI is a thing of unparalleled beauty.

Of course, I’m not in any ETFs at all right now. Instead, it’s all individual stuff, because unlike the shamelessly-manipulated SPY, items like LII are left to behave in an organic fashion, yielding curves that excite bloodthirsty bears like myself.

This sums it up best:

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