Wilshire 5000
After six years of Extend and Pretend, the waves just became crystal clear...
For six years straight, Central Bank drip feed administered via HFT Bots controlled the markets. Social Mood was reverse engineered into a manic state of fake euphoria. Then, that spell was broken literally overnight with the Yuan Devaluation. Since that time, Skynet has lost control of the markets, featuring multiple gap and crap overnight sell-offs - more in the past six weeks than in the past six years combined.
As we've just seen in China, Central Bank drip levitation works on the way up and then fails catastrophically on the way down. Drip levitation is about low volume, low volatility momentum ignition, whereas Elliot Wave/Social Mood based selling is characterized by high volume, high volatility asset re-allocation. One is measured in billions spread over months, the other is measured in trillions spread over days.
The game is over. But some people didn't get the fucking memo. Yet...
Asset reallocation visualized aka. "Change of plans"
Rydex bull:bear asset ratio. From 30x down to 9.7x...
Yen/dollar. Locus of overnight collapse...
Yen with S&P:
