Samwise Quick Reference Handbook
To streamline our daily blogs and conserve space, we’ve organized key resources into a convenient, collapsible dropdown menu below. A sort of Quick Reference Handbook if you will -- as our friends in aviation might call it. By clicking the menu below, you’ll have qu...
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Thanks for the updates Sam! ????
One question for you for my own learning:
Let’s say on Wednesday we break through the $560 resistance and we confirm the QQQ is now in a correction, Does that mean the correction actually started on Aug 13th when we reached the $583 peak or did it start during this last run up to $577 yesterday.
I really appreciate your answers to the questions here as well as the daily updates!
So we count, the correction has started from wherever the high is
When we look at table 4.1 we count the high point as the start of the correction
And then we just count the number of days it takes to go from the highest point to the lowest point
Often times you get what we have right now, which is half of the correction is just trading sideways.
So yeah if everything starts to sell off from here, then the correction technically started on day 89 when the QQQ reached 583.
There’s no other way to do it with consistency. We try to answer the question: how long does it take to go from the peak of one rally to the low of the ensuing correction?
Similarly, we count the absolute low point as the first day of the rally. Often times you’ll get like a retest of the lows and if new lows aren’t made, then we count the rally as having started whenever it was that the market reached its low lowest point.
We tried to answer the other question of how long does it take for the market to reach a high from the lowest point of the previous correction?
Consolidations are often counted as part of either the rally or the correction depending on whether new highs or lows are made.
For example, if next week, the QQQ manages to rally to 586 peak and then sell off, well in the last few weeks of consolidation will be counted as part of the rally. We will consider this rally is having gone 104 days or whatever. No new highs are made, then the rally ended at 89.
That’s how we count every other past rally and correction on table 4.1.
Thank you for your reply and answering my question! Have a great weekend! Fingers crossed we see a plunge next week!
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QQQ/NVDA already oversold on the hourly
So if this unlikely breakout do happen, it will be counted as the 6th segment rite?
Segments are done. We had a 5th segment. What we recently observed isn’t a segment because we don’t have a high. The QQQ rebounded from $560 up to $578 before then falling back to $560 again.
The market is more in consolidation zone. No more segments. That’s all done. Once we go sideways, the segments are kind of oversold. Instead, we just have plain volatility.
Kind of like what we saw back in January & February 2025. We had a final segment and then the QQQ spent two months in high volatility.
Hello Sam,
A key crash signal just triggered also.
the 30-year vs 2-year U.S. Treasury spread hit the critical level of ~50, a point that has historically preceded major market crashes.
Why it matters:
This ratio has an uncanny track record:
1990 recession → the ratio hit ~50, then markets fell.
Dot-com bust (2000) → it hit ~50 just before the bubble burst.
Global Financial Crisis (2007–08) → it reached ~50 right before the housing/credit collapse.
COVID crash (2020) → it touched ~50 just before markets plunged ~34%.
Now, in August 2025, the spread closed at 49.65 (~50) again—exactly the danger zone from past crashes.
The setup today:
This flash comes as the S&P 500 hits euphoric all-time highs, creating a backdrop of complacency—markets look safest right before they’re not.
Important notes:
It doesn’t mean markets will crash immediately or on a precise date.
It does mean the window for a crash is now wide open.
From here, any catalyst—earnings miss, geopolitical shock, credit event, even a minor trigger—could unleash it, because the stress is already baked in.
Bottom line
No indicator is infallible, but whenever the 30Y:2Y ratio hit ~50 with markets euphoric, history showed bulls were picking up pennies in front of a steamroller. The crash risk is real, even if timing is unknowable.
Is this an indicator you’re following too?
What do you think?
Has it ever hit 50 and not led to a correction?
Here’s what I was able to verify (deep-dive approach) about the signal in question — the monthly RSI(14)
Result
Since 1980, I can identify only 4 clear occurrences where the monthly RSI(30Y:2Y) rose above 50 after a prolonged low phase: 1990, 2000, 2007, 2020.
Each time, a major equity correction followed in the subsequent months (1990 recession, 2000–02 dot-com crash, 2007–09 GFC, 2020 COVID crash). I found no documented instance of a >50 reading that was not foll
How I validated it
The “4 occurrences” timeline comes from published full charts (ratio $UST30Y:$UST2Y with monthly RSI) that specifically annotate these crossings of 50 and the S&P 500 peaks
I then cross-checked with mainstream literature on yield curve/recessions (San Francisco Fed, Cleveland Fed, Reuters/Barron’s on post-inversion steepening), which confirms that re-steepening phases after inversion are typically associated with macro/market downturns — consistent with these 4 episodes.
Control checks (possible false positives)
I looked at candidate periods without obvious crashes (1994, 2011, 2016). On public historical charts, the monthly RSI of the ratio did not sustainably break above 50 from a marked low at those dates (and in 1998, there was in any case a ~20% drop). I found no evidence of an RSI >50 that remained without a notable correction.
Limits and caution
Very small sample (n = 4) and a non-academic indicator → no strong statistical guarantee; causality is not established.The “50” refers to the RSI of the 30Y:2Y ratio, not the “30Y–2Y spread” itself.
Verdict
Based on available data and sources, the answer is no — I do not find any case where the monthly RSI(30Y:2Y) crossed 50 without a significant equity correction following.
wow, great job on this! were you also able to identify the duration from the trigger to when the market corrected?
Always makes it more compelling (caveats aside) when it’s consistent in one direction
I could be wrong but these aren’t just corrections. These look like complete market turnarounds.
Could you be more specific?
Sure, just acknowledging what’s in the post: recession, bust, crisis, collapse, crash
If we’re sticking to the analysis on the site, this is a pullback before continuing onward and upward. A recession or collapse paints a different picture.
So Todd’s right. @Karl the analysis looks very sound. There are plenty of different indicators pointing to the market eventually crashing. I think one of the stronger indicators is the CAPE ratio if you’re looking for bull market ending indicators.
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As Sam Weiss and our strategy is concerned, we try and work within the smaller rally-correction cycle. Intermediate-term periods where the market rallies for anywhere between 50-100 trading days. The average is like 55 days. The high end of the ranger is 100-days.
When those cycles end, we generally see normal corrections of 8-14%. That’s what we see in the overwhelming majority of the circumstances. It happens like clockwork. For example between the end of 2022 (Dec 2022) until today (Sep 2025), we’ve seen 5 intermediate-term rallies and corrections of 12%, 11%, 8%, 14% and 25%. We’ve seen rallies of 25%, 36%, 32%, 22% and now 45%. WE expect another correction soon of 9-14%.
Normally, we don’t take many actions during the rally part. In most cases, we use the rally to hedge. We buy puts in most cases and do nothing else. We don’t sell. We don’t sell covered calls. We just sit back and wait for a correction where we then buy.
During this particular rally, because it produced 45% returns AND because it lasted WAY longer than the average, we sold covered calls, we bought protective puts, we reduced down by closing out our NVDL that was up 120-150%. And we’ve also bought a 6% position in put-spread to try and capitalize on the downside.
But that’s abnormal. Normally we wouldn’t do that and we’re unlikely to do that again anytime soon unless the QQQ rallies 35%+ over 80+ days. Then we probably do it again.
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So what is our approach. Our strategy is outlined in the Strategy link . But our strategy is to IGNORE bear markets. We don’t try to predict them. We don’t position ourselves in any way in anticipation of them. Why? Becuase they’re largely unpredictable. It’s impossible to predict when a bear market is going to happen.
Instead, what we do is get long and stay long. And then we hedge out the risk of a bear market such that if one occurs, we will make money or at least not lose any money.
That’s the way to do things because the market goes up way way more than it goes down and it drops far less often than it goes up. That’s the reality. We have a 55% bear market in the financial crisis. So what? I can show so many years where the QQQ is up 80%. 70%. One rally where it’s up 45%. Bear markets are extremely rare. Bull markets result in much greater returns (150-200%) than do losses in bear markets (40-55%).
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The summary point here is this. We generally try and predict regular corrections based on historical trends. We generally try to stay long the market and hedge out bear market risk rather than go to the sidelines or something.
We’re bullish on the market long-term. Short-term, expect a correction. But that’s all.
Not saying a bear market can’t happen or that a crash can’t happen. Just that we’re not in the game of trying to predict them. We’d rather just hedge out that risk and go long and stay long.
Thanks Sam. It’s clear. ????????
this is really interesting.
Hopefully sam can shed some light on this
Me too, Sam, if you pass by, bring your light!
ok someone pass the oil this time for real
Can you stop littering the page with nonsense?
Hi smiley, I have found if you change the Sort order between Newest, Oldest, or Most Voted all of the comments will show.
I don’t know which sort will cause them to show but I can see all the comments when I toggle the sort feature. It’s a bug on the site.
These are all non-custom components. All the custom stuff I’ve coded works flawlessly. But comment section and app are platforms. I don’t have control over some of those features.
Hiring a pro to create a custom solution would cost more than the site produces in revenue in like 5 years lol. No joke.
The comment section is WpDiscuz on desktop which is one of the most widely adopted comment sections in wordpress. Online, it’s app platform. I don’t have control over either. More with WpDiscuss. Zero on the app.
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Here’s what I’ve found. Google/Android sucks when it comes to this entire site. Virtually every aspect of the site doesnt work as well on Google platforms as it does on Apple. And here’s the huge irony. The mobile app platform is designed for android. Many of the components we use are android/google based. For example, consider the huge irony of us using firebase (Google component) that fails to work well on android devices but works flawless on iOS. This is for push notifications. Our iOS App platform for push notifications was developed with android in mind and it sucks on android.
I’ve never had an issue with comments loading on the site. Ever. I don’t have to do any weird things like sort comments and things like that. Just an FYI.