Emini Nested Wedge Buy Climax In April But Minor Monthly Buy Signal

On the monthly chart, the April low’s was above the March low. Also, the April high was below the March high. April was therefore an inside bar. That is a one bar Breakout Mode pattern. In addition, March was huge and it was an outside bar. There is now an ioi (inside-outside-inside) Breakout Mode pattern on the monthly chart.

After one day, May is currently inside of April. That means consecutive inside bars (ii), which is another Breakout Mode pattern.

Since the past 3 months were all dojis, the pattern is more neutral. That reduces the chance of a strong breakout into a trend.

Furthermore, the monthly chart has been sideways for 8 months. Markets have inertia. They tend to continue to do what they have been doing. Therefore, traders expect more sideways trading.

So what happens if May breaks above or below April’s range? Most likely, not much. Trading ranges resist breaking out. Consequently, a move out of April’s range will have a hard time lasting more than a month or so. The EURUSD will probably continue sideways indefinitely.

Everyone knows that there will eventually be a breakout into a trend. But until there are consecutive big trend bars, traders will continue to look for reversals.

Thirty million Americans have lost their jobs. The majority of the country has significantly curtailed its spending. Consequently, what happens with the pandemic is hugely important to the economy.

The euphoria over the past month is ending. In part, it was due to traders concluding that this is not going to be like the plague. But they will soon conclude that it also will not be as simple as the flu. The result is the the market has to remain repriced.

What happens with the pandemic and our response will determine what the new price is. Traders believe it is somewhere below the February high and above the March low.

Europe and Asia are paying the WHO to develop a couple dozen vaccines. They expect that at least one will prove to be safe and effective once the studies are complete. They might start to mass produce many of the vaccines before the studies are done so that if one is found to be safe and effective, they will have millions of doses ready immediately.

This is a smart approach, but they must make sure that whichever they choose as the best option is safe. You cannot vaccinate millions of people and then discover that 10% die 2 months later.

The United States has decided to not participate with the WHO. Instead, we are doing the same thing ourselves, but with far few vaccines. This is risky because if none of ours works, we will have lost many months and countless lives as we then try to catch up with the WHO, Europe, and Asia.

The idea of making millions of doses of several vaccines before the studies are complete is great. Doing it on our own and not combining resources with Europe, Asia, and the WHO is a political decision. It does not make scientific sense and it is not in the best interest of the American people.

I have talked a lot about our lack of adequate testing. It does not make sense that we have not been far more aggressive in manufacturing test kits and in conducting widespread tests. This is the reason why we had to shut down the economy and the reason why we have had to shut down for so long.

I don’t understand it. We’ve had months to fix this. Why aren’t Fauci and Birx screaming about this? In WWII, we quickly made all that we needed. Why are we choosing not to make 10 times or 100 times more test kits? We don’t even have enough tests for the 100 senators returning to Washington next week. Incredible.

Adequate testing will open up the economy sooner. That will save hundreds of billions of dollars and tens of thousands of lives. How much would it cost to make a few billion test kits? Nothing compared to what we are losing.

I talked about exponential growth in February. There are basically 3 ways for an infected person to infect someone else.

You obviously want to avoid someone who is coughing and looking very sick. If they are sick with Covid-19, they can easily spread the disease.

But there are 2 additional problems with Covid-19 that increase its spread. First, most infected people are not very sick. Many do not realize they are sick at all. Yet, they can be contagious. Next, many who end up becoming clearly sick can begin infecting others 3 days before developing symptoms.

The average infected person, whether or not he gets diagnosed or ever discovers that he was infected, infects 3 other people. Let’s assume that a person who gets infected is contagious for 2 weeks. If you start with 1 person, in 2 weeks, he is recovered, but there are now 3 new infected, contagious people. Two weeks later, there are 9.

If you graph the number of cases over time, the line curves up and to the right. When the number of infected people accelerates like that in a parabolic curve, it is called exponential growth.

The obvious goal in a pandemic is to eliminate the disease entirely. For example, when Europeans brought smallpox (another virus) to the North America, as many as 90% of the indigenous population (Native Mexicans and Native Americans) died. Ninety percent. Think about that. Yet, the vaccine today is so effective that smallpox virtually no longer exists.

For Covid-19, one of the major goals of disease control is to stop the exponential growth. The 1st objective is to get down to below geometric growth. In geometric growth, one person infects one other person. In 2 weeks, the 1st person is no longer contagious, but the 2nd person is. This results in the number of contagious people staying the same.

What happens if the average infected person has only a 50% chance of infecting someone else? If there are 4 contagious people today, there will be only 2 in 2 weeks, and only 1 a couple weeks later. This is the main goal in all pandemics. Get the spread rate to less than one so that the number of cases eventually gets to zero.

One of the main tools to accomplish this is widespread testing. You want to find as many contagious people as possible and then keep them away from everyone else. Taiwan, South Korea, Germany, Austria and many other countries have done a much better job than the US. Our failed approach has resulted in our problem being comparable to that in developing countries.

South Korea is an interesting example because their 1st known case was on January 21. That is the same day that the US had its 1st known case. They have had about 250 deaths in a population of 50 million.

The population of the US is about 6 times greater. Yet, the US has had 60,000 deaths. Our death rate is 240 times higher!

Why? Because South Korea quickly saw how serious the disease was and instantly began aggressive testing. They listened to their medical experts and decided to rely completely on science.

On the other hand, the US ignored the medical experts and chose to prioritize politics in an election year. We spent almost 2 months allowing the coronavirus to spread exponentially until the American public demanded a better response.

I did not hear leaders from either party forcefully arguing that we were horribly mishandling this crisis. As a physician, I was telling everyone throughout February that our approach was going to lead to a disaster. I’m certain that most other doctors felt the same way. But we are not the people making the decisions.

Fortunately, many governors began to do what the federal government should have done. While that has slowed the progress of the disease, it is still spreading exponentially.

Not many of us want to live in China because we like freedom. But a strong centralized government can be good in a pandemic. China was slow to react, but once they did, they quickly got the spread under control. South Korea effectively used a strong federal response and it also saved thousands of lives.

We are the most free people in the world. One of our freedoms is a right to ignore science and do dumb things. States are free to eliminate social distancing guidelines. There are no serious consequences for individuals who ignore the guidelines, and many are making that choice. The result is the disease will continue to spread exponentially for a long time. This will continue for many months after a vaccine, and that means late into 2021.

Coronavirus will not stay confined to those states with loose guidelines because people travel freely. This will cause tens of thousands of more deaths than what would have happened if the country maintained strict social distancing and had an aggressive national testing policy.

Therefore, even people and states who strongly want tight guidelines will have a far greater death rate than they otherwise would have had. Even if their view is held by the majority of the country, they do not have the freedom to chose a death rate comparable to that in South Korea.

Everyone agrees this is a war. With any other war, would we choose to have 50 governors (basically, lieutenants) each deciding how to fight its share of the war? Of course not. We would fight it a general in command. Would we ignore the military experts? No.

But this is a different kind of war and there are strong feelings about our culture, economy, and destiny. Many people do not want the federal government telling them what to do. Also, many believe that a 1% death rate is better than having ongoing damage to the economy and major changes to our lifestyle.

Even if only 30% of the country chooses the economy over a hundreds of thousands of deaths, they will win. That is the herd immunity strategy. If 70% of the country gets infected, the average infected person will be more likely than not to not infect anyone. That will eventually lead to the pandemic ending.

Sounds like a good strategy, right? It is if you are not old, poor, or a minority. The death rate for the country will be about 1%, but it will be 5 – 10% among some groups.

Also, even if only 1% dies, if 70% get infected, that is 200 million infected people. Then 1% is about 2 million deaths.

Obviously no one wants 2 million people to die, but that is the chance that the herd immunity crowd is willing to take. And they have veto power over the rest of us. For social distancing to work, you cannot have 30 – 40% not participating. Those people get to choose herd immunity for everyone, not just themselves. Tyranny of the minority.

There will be a vaccine before 70% gets infected. But probably not before 10 – 50% of the country will get infected.

Remember, last week I said I do not see how fewer than 500,000 Americans will die. This herd immunity choice is the reason. There are enough who believe this way so that our result will remain comparable to that of developing nations. In fact, we are already shocking behind many developing countries in terms of the percentage of our population dying from Covid-19.

We are free to choose to not be a great example for the rest of the world. And that is the path we have selected. This will this result in needless deaths. Furthermore, it will create far greater damage to the economy compared to what would have happened had we made decisions based on science instead of emotion and politics.

The percent of our population that will die will continue to be far greater than in South Korea, Taiwan, Singapore, and many other countries that are acting aggressively at the national level based on science. It’s our choice to give our citizens the same chance of survival as people living in El Salvador, Ghana, and Bangladesh.

Again, both political parties in Washington have failed to provide leadership in a national crisis. Fighting a war with 50 lieutenants in charge instead of a few generals is deadly. One party is stupid. The other is stupider.