Nasdaq, 17 Nov. Trading into the Lunar Eclipse

2021년 11월 17일

On 19 November an important lunar eclipse occurs, which will be the longest since 580 years. The previous eclipse of 26 May coincided with the crash in crypto. Historically we do see a correlation between significant astronomic events and higher market volatility, and even crashes. 29 November is the date which stands in opposition to the eclipse in May (180 degree rotation on the Gann Square of 9), which gives us an 8-day ‘window of risk’ from 22-29 November (counted in trading days).

Geometry:
Price reacts to the pitchfork so that we can take the median as potential support. We may find potential targets along the .5 fib (green line).

Bonds:
HYG is the high-yield (=risk) bond ETF and it has shown significant weakness. Bond traders are much more risk averse than stock traders and may spot problems in the markets earlier than anyone else. This serves us as an early indicator for a reversal.

Elliott:
Price has reversed precisely at the .236 Fib (blue box top), so that we can assume a completed wave (iv). The 1.618 extension of wave (i) is at roughly 16.550. A wave (v) can unfold as an ending diagonal, which would be an indication that our count is correct.

Gann:
Support: 15376
Resistance: 16372

How I trade it:
Extending wave (i) from wave (iv) has worked very well in this trend. Therefore an idea could be to close longs towards the 1.618 extension, roughly at 16.550.