I come to you this weekend to warn of a potentially disastrous pattern that may be developing on the VIX (aka “the fear gauge”), as we wind our way through this most recent corrective action in the market. This pattern is the fabled “Double Winged Dragon” pattern which is not known by many market participants. However, as you know, I am a sorcerer of the 47th degree and have knowledge imparted down through the ages strictly from mouth to ear, never in written from, by generations of enlightened market Sorcerers.
I am breaking this code of silence, risking exile, simply because I care about you and want you to survive the potential destruction, which may in fact be thrusted upon you in the coming weeks.
This pattern has many phases and distinct signs which cannot, and should not, be ignored if you value your portfolio’s financial worth.
Phase One: The “tail of seduction” phase which, ever so gently, lullabies investors to sleep, convincing them they are safe and sound as a baby in the loving embrace of their mother.
Phase Two: The “wings of distress” which gives warning of the potential destruction that resides just around the corner.
Phase Three: The “neckline of last hope” gives investors the false sense that everything is now ok and the worst is behind them.
Phase Four: The “neck of confirmed disaster” lets you know that the destruction of the market has indeed begun and your time to exit safely has most likely already come to pass.
Phase Five: The “crown of peak destruction” is when the last investors sell out, exiting the market completely while financial media simultaneously declares the markets to be inexorably doomed once and for all.
Phase Six: The “fires of end times doom” which sees men, women and children bartering for goods, services and resources and resorting to burning their paper currency to keep warm in the cold winds of economic depression.
These six phases can be seen in visual form below.
Behold: The chart below which shows where we are currently, and spells out the many stages of what is arguably the most powerful pattern known to man. THE DOUBLE WINGED DRAGON PATTERN!
YOU HAVE BEEN WARNED!