![\"\"](\"https:\/\/jeffclarktrader.com\/market-minute\/wp-content\/uploads\/sites\/19\/2018\/01\/Screen-Shot-2018-01-29-at-8.45.29-AM.png\")
<\/p>\nStraight-up moves in the financial markets are fun while they last. But they\u2019re miserable when they come to an end.<\/p>\n
And they always end \u2013 usually by erasing 100% of the gains in a symmetrical straight-down move.<\/p>\n
Let\u2019s use the biggest bubble of our lifetimes as an example. Here\u2019s a chart of the NASDAQ right before and after the dot-com bubble in 2000\u2026<\/p>\n
<\/p>\n
The NASDAQ started its parabolic move in June 1999. The rally lasted nine months, and by the time the index peaked in March 2000, the NASDAQ had doubled in value.<\/p>\n
The index had gone vertical. It was panic buying. Get in or get left behind.<\/p>\n
Those sorts of moves are exhaustive. They\u2019re unsustainable.<\/p>\n
Nine months later, the NASDAQ was all the way back down to where it was trading in June 1999.<\/p>\n
The charts of silver and gold showed similar patterns when they peaked back in 2011. Here\u2019s how silver looked back then\u2026<\/p>\n
![\"\"](\"https:\/\/jeffclarktrader.com\/market-minute\/wp-content\/uploads\/sites\/19\/2018\/01\/Screen-Shot-2018-01-29-at-8.50.42-AM.png\")
<\/p>\n
Silver\u2019s parabolic rally started off quiet enough in November 2010. Four months later the metal went vertical. By early May 2011, silver had gained 100% in about six months.<\/p>\n
But that action exhausted the buyers. The price of silver dropped as rapidly as it had risen. It took seven months to erase all of the gains of the previous rally.<\/p>\n
Gold showed the same action in mid-2011\u2026<\/p>\n
![\"\"](\"https:\/\/jeffclarktrader.com\/market-minute\/wp-content\/uploads\/sites\/19\/2018\/01\/Screen-Shot-2018-01-29-at-8.52.03-AM1.png\")
<\/p>\n
Gold\u2019s parabolic move lasted four months. The final vertical move took gold all the way up to $1,900 per ounce in August, 2011\u2013 up more than 20% in just over one month.<\/p>\n
The decline was just as fast.<\/p>\n
Now, the argument most folks make after I show them these charts goes something like, \u201cYeah, but all that stuff happened years ago. Investors are smarter than that today. They\u2019ve seen it before. They won\u2019t make the same mistakes.\u201d<\/p>\n
If you\u2019re inclined to think that way, well, there\u2019s just one word\u2026 Bitcoin.<\/p>\n
Bitcoin went vertical last December when it rallied from $10,000 per coin to $20,000 in about three weeks. It also took just about three weeks to give all those gains back. Bitcoin traded below $10,000 per coin last week.<\/p>\n
My point is this\u2026 vertical moves in asset prices are unsustainable. They\u2019re dangerous. And they tend to be erased just as quickly as they occurred.<\/p>\n
With that in mind, here\u2019s a current chart of the S&P 500\u2026<\/p>\n
![\"\"](\"https:\/\/jeffclarktrader.com\/market-minute\/wp-content\/uploads\/sites\/19\/2018\/01\/Screen-Shot-2018-01-29-at-8.53.42-AM.png\")
<\/p>\n
The S&P 500 has gone vertical. While we can\u2019t possibly know exactly when the rally will end, the slope of the parabola suggests we\u2019re approaching the exhaustion phase.<\/p>\n
Also, key technical indicators, like the MACD<\/a> momentum indicator, closed Friday at the most overbought levels in the 35 years I\u2019ve been involved with the financial markets. Maybe they\u2019re the most overbought levels ever.<\/p>\n This is a dangerous environment in which to put new money to work. We can\u2019t know for sure. But it seems to me traders should get a shot at investing at lower prices sometime within the next three months.<\/p>\n Best regards and good trading,<\/p>\n Jeff Clark<\/p>\n Today\u2026 presented without comment\u2026<\/p>\n This market is really getting crazy!<\/p>\n \u2013 Van K.<\/strong><\/p>\n<\/blockquote>\n And some thoughts on the Delta Report<\/em>\u2019s latest winning gold trades…<\/a><\/p>\n I just realized that your style of successful trading is like square dancing, in which you only swing your partner for a short time, then move on to the next partner. You do a masterful job of quickly moving from one trade to another — as you have done in the past few weeks with gold stock options, getting out of them with 100%+ profits (in a few hours or days) at their swing highs, and buying them back when they swing low.<\/p>\n The appropriate long option is your partner, then cash is your partner. Earlier this week you predicted the sharp decline of the US dollar<\/a>, then Thursday morning recommended covering the shorts<\/a> and predicting a sharp drop in gold, which happened a few hours later.<\/p>\n I’m enjoying the profits that flow from following these predictions. May God grant you great health and long life. Lifetime member for the past two months.<\/p>\n \u2013 Jim V.<\/strong><\/p>\n<\/blockquote>\n <\/p>\n You are a master at reading the market. Much respect. Thank you so much for turning all that gold into so much green for us today. Rinse, wash, and repeat. Can\u2019t wait to play it again!<\/p>\n![](\"https:\/\/casey-assets.s3.amazonaws.com\/images\/misc\/jeff-clark-signature.png\")
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