I spent some time reviewing my Cycles chart to verify its accuracy. You may recall that I had suggested about two weeks ago that December 9 would be the “ideal day” for a Master Cycle low (258 days). Instead, it may have fallen on Monday, December 14, at 11:39 am. You might say that it was 4.3 calendar days from the average length of time, on day 263. I don’t have the exact figure any more, but I had done a study that showed that over 90% of all Cycle bottoms happen within 4.3 days of their normal date.

The only alternative would be a flash crash, but there don’t seem to be any indications in the Premarket, thus far. The current levels are being defended, but if they should break loose, a flash crash may still ensue that may not be over until Tuesday.

ZeroHedge has this to say: “One week ago, and again last night, we previewed today's main event: an immensely important quad-witching expiration, the year's last, one which as JPM's head quant calculated will be the "largest option expiry in many years. There are $1.1 trillion of S&P 500 options expiring on Friday morning. $670Bn of these are puts, of which $215Bn are struck relatively close below the market level, between 1900 and 2050."

We may not recover from that, if it were to happen, since the next Master Cycle low is due on January 19, the Tuesday after the January options expiration. A flash crash in the next few days may take out the 1820.00-1867.00 lows. The January low may challenge the lows illustrated on the chart. I hope that I am conservative in my views.

TNX seems to be supporting the idea of money flowing out of equities. This indicates at least some decline may take place today.

Regards,

Tony

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