Global Crisis Alert System Flags S&P 500 Market, BitCoin, and NVDA for Instability From Aug – October
by efrem on Thursday August 3, 2017 at 10:01 pm EST | Tags: Dragon-Kings, flash crash, Labor Market, Micro-Structure, Tail-Risk, VIX, Volatility
Running Alpha’s Global Crisis Alert System has flagged the S&P 500 multi-fractal market structure on 3 axes of change ( Valuation, Liquidity, and Volatility ) for severe instability ahead.
The S&P 500 Market Meltdown is extremely near and in clear visibility across all time-frames from micro-structure to longer tail-horizons we focus on; once price breaches the 2460.25 to 2459.75 price zone on the September Futures S&P e-mini contract then this opens the flood gates for a massive plunge lower; and once below 2400, watch out!
The Tail-Risk Threat spans a window beginning anytime as early as starting before Aug 11th/14th +/- 3 days upward to October month end. This time zone marks the initiation of a Severe Correction ; so any rallies after this break will be severely limited in nature and time dimension. VIX should soar.
Also supporting these market views by Running Alpha is an independent research note by JP Morgan, where Marko Kolanovic, Global Head of Equity Derivatives and Delta One Strategy, sites a collapse in the correlation among equities & equity sectors in the benchmark indices, which have been shown to offer precursor signatures of market instability ahead. The S&P correlation matrix today is similar to what was observed in in 1993 and 2000, just prior to the 1994 sell off & 2001 Bear trend.
As indicated in a July 27th article by Tae Kim, an Investment Journalist at CNBC, along with CNBC’s Michael Bloom who contributed to this story —Add to Portfolio