Consensus 10 for '10 Predictions

For comparison to my predictions, here is a compendium of almost all major forecasts. The consensus forecasts and advice seem to be:

• S&P 500 rallies to 1250
• Emerging markets outperform developed
• U.S. outperforms other developed markets
• Earnings growth of 20% Plus
• U.S. economy grows at 3%
• Job growth turns positive early in the year but unemployment remains high
• Inflation remains low
• Rates to rise across the curve
• Stocks outperform cash and bonds
• Overweight health care, tech and telecom — Underweight financials, utilities and materials
• M&A picks up because of strong cash flow and slow growth
• GOP makes gains in House and Senate but Dems continue to control Congress

Comments

[TC]

You forgot about the part where Prechter covers his shorts from SPX 1000 and 1035, and his 200% short-recommendation about 40 points ago in the S&P!

:)

[Dave]

Neely is now afraid of a massive, vertical type collapse and sees far too many "perma-bears" now turning bullish.

I believe he's now willing to get stopped into a short S&P trade basis March at 1109.50

[DG]

I believe he's now willing to get stopped into a short S&P trade basis March at 1109.50

You "believe"? Did you just guess at the 1109.5 number or are you posting it verbatim from his update?

Yelnick, isn't this a bit much in terms of disclosing Neely's trades for free? Saying generally, "He's looking to go short" should be sufficient, no?

[TC]

DG,

What is your problem???

Did Neely not offer a FREE 2-WEEK TRIAL to his service for Xmas?

If I didn't know any better, I'd swear that you are a shill for Neely.

[yelnick]

DG, seems to me the general direction is newsworthy but the specific trading strategy should be reserved for his subs, at least until the trade is stale. What I found interesting is his timing, that his neutral triangle count needs to drop within a few trading days or he has to reconsider his wave interpretation. If the drop comes it will be sharp under his Count, which was the point of Dave's comment.

Dave, did you sign up for the free service?

[Hank Wernicki]

Wouldn't one have a margin call by now if short at 1,000 / 1035 ?

Well depends how large your trading account is I guess

[joe]

Yelnick - what do you know about Charles Nenner. He is saying the market is going to start dropping fast, and he does not use Elliot as far as I know, but some other math.

Joe

[BB]

What happened to your bearish sentiment?

[Dave]

Yelnick,

Yes, I signed-up for the 2 week trial. Thus far, it has not been very definitive.

As you articulated, at some point in the near-term Neely needs to see the market drop dramatically otherwise he is going to have to "re-count" his wave structure.

[Dave]

Joe,

Earlier this year I subscribed to Charles Nenner for a full-month after having done some homework on his methodology. It was very expensive, and I dropped the subscription due to a lack of applicable VALUE to my trading. More often than not, his parameters were so broad that the market would travel great distances before he was to be "stopped-into" a trade.

I did not find much value in many of his "cyclical" forecasts. Turning dates would come and go, with no discernible change in trend or movement.

[joe]

Thanks Dave - I appreciate the heads up.

Joe

[DG]

DG,

What is your problem???

Did Neely not offer a FREE 2-WEEK TRIAL to his service for Xmas?

You know what, you're right. I had forgotten about that. Hey, otherwise I don't see that me saying that it's a bit out of line to post something that is protected BY LAW.

If I didn't know any better, I'd swear that you are a shill for Neely.

I'm glad you know better.

[Greg]

DG, you are kidding yourself if you believe that revealing for free Neely’s expectations or calls at very general terms adds any value.

[DG]

DG, seems to me the general direction is newsworthy but the specific trading strategy should be reserved for his subs, at least until the trade is stale.

Yeah, I mean obviously there's a lot of information flowing out there that is out of any newsletter publisher's control (I think Sentiment Trader used to embed a file in their e-mail notices that could track if one of their e-mails got forwarded, so there are some counter-measures), so keeping it all under wraps is tough.

[TC]

Come on DG . . .
You spent hours and hours running to your beloved Glenn Neely's defense last year with more posts than Hochberg's changed wave counts. Everyone on this board knows this. You are a Neely shill. Plain and simple.

[DG]

Posted by: Dave | Wednesday, January 06, 2010 at 01:49 PM

Hey, I apologize, for whatever it's worth.

[yelnick]

Joe, I have never followed his work. In general I have found cycle-based approaches to be mere tendencies, like seasonal patterns or decennial patterns - even the most reliable, the Presidential cycle. As such they come and go at the worst times. Worse are those that layer in Astrology. Usually when a cycle emerges and is recognized, it is about to go away. I find Sy Harding's work pretty useful, but even his pattern (buy in Nov, sell in May) has not worked well since 2007.

What concerns me about the wave pattern right now is the same thing that has sent Sy's model awry: the massive liquidity from central banks combined with fiscal stimulus has lengthened waves. Simple case in point: the Hope Rally was predictable (even I predicted it and got it essentially right) but has gone longer and risen slower than expected. This seems to be a manifestation of gimmickry by governments (cash4clunkers, dollars4dishwashers, first-time home buyer credit) as well as some impact from the Porkulus.

Yes, at some point the govt will run out of tricks and sleights of hand, and the fall will be greater than 2008 was, or 2000. I buy the historical argument, made by the Austrians, that the credit debacle can be postponed but not avoided, and the attempts to postpone make the eventual fall worse. We are living through that grand experiment with history right now. The fixing of S&L and Latam banks in the early '90s through liquidity helped cause the dot-com bubble; the rush of liquidity in 2002-5 caused the housing bubble; and now the even larger gusher of liquidity is causing the Hope Rally.

Unlike 2000 or 2007 this pump seems to be failing - we barely hit the 50% retrace, we *might* hit 62%, but no one is expecting a higher high. We might all be shocked and awed if this market continues upwards beyond the all time highs, but I doubt it will happen. Instead, this market seems to be in a slow topping pattern, a fight between the forces of stimulus and the real economy. The govt weapons are becoming less powerful. When they run out of bullets, we fall.

[DG]

DG, you are kidding yourself if you believe that revealing for free Neely’s expectations or calls at very general terms adds any value.

I'm not sure what you mean, Greg. If you mean I think that revealing even Neely's exact trade calls makes any difference in whether they happen or not, no, I don't. But, you know what, it doesn't matter whether they do or not, because it is a matter of copyright law, not trading results.

If you mean that it's useless to know, in general, if Neely's looking long or short without knowing specific entry, exit and stop levels, well, that's up to each individual reader to decide. One person may say, if Neely's long, I want to be long or vice versa.

If you mean that it would be more valuable to know the exact entry, exit and stop levels for a trade, well, yeah, and that's what subscribers pay for and giving it away was what I originally was saying was a bit out of line, since I had forgotten about the free trial period.

[Greg]

Neely is now afraid of a massive, vertical type collapse and sees far too many "perma-bears" now turning bullish.

I couldn’t hold myself. DG, do you think the above statement, is of any value? Afraid of a vertical collapse, afraid of a horizontal market with low vol, afraid of a melt up and so on so forth. ALL of us are afraid of something. We play our fears every day. What is so valuable that someone is afraid of a vertical collapse whatever that means.
Oh by the way, “too many perma bears now turning bullish” is really valuable. Are you kidding me? Oh, I am the smartest kid in the class and when I see the others doing something I go the other way. Who is the perma bear for months now that missed the biggest rally over several decades? Nothing against Neely, I have equally “high” respect for Mr. P. predictions who I guess is triple short now.

[DG]

Come on DG . . .
You spent hours and hours running to your beloved Glenn Neely's defense last year with more posts than Hochberg's changed wave counts. Everyone on this board knows this. You are a Neely shill. Plain and simple.

How exactly am I a "shill"? Let's see, I get no money from Neely (not even a free subscription), I disagree with his counts a good portion of the time on my own blog and I frequently send him e-mails asking him why he posts analysis that contradicts his earlier statements in his published works, because I want to better understand if he is being inconsistent or has developed some new way of looking at things.

Anyone who asks, I tell them to try Neely out for a bit (although I do think that unless during the two-week trial, you take the time to go through the archives, you have a good chance of getting very little out of a two-week period, since it's not all the time when the market does something of significance in a random two-week timeframe), but that's only a suggestion and I don't get any kickbacks or referral fees or anything that a "shill" would get.

So, unless you've got some new definition of "shill" that only you know about, you're wrong.

Anyway, you guys can have this board. I've got my own blog and I'm happy to only post there more or less. I only posted today because of what I thought, mistakenly, was a post that revealed a little too much info. I don't need the hassle.

[joe]

Thanks Yelnik - and I do appreciate your posts and the discussions on this site. You have a very good site.

Joe

PS - you are certainly right in saying that the feds are running out of games here.

[joe]

DG - you are over reacting.

[Glenn Loser Neely]

Prediction # 11

NEO Garbage Wave Inc. and GLENN Loser Neely go bankrupt.

Even with his free 2 week trial, his service is worthless.

[Glenn Loser Neely]

DG alias "Neely Shill",

Finally you leave us....we are NOT going to miss you!
Please please... I beg you.. do not comeback!!

Neely Shill....I can't stop laughing!!

Glenn Loser Neely

[joe]

There is someting seriously wrong with you GLN.

[Glenn Loser Neely]

Joe,

You are correct... I am a loser!
I have a lady voice...I am a dwarf and my neo garbage theory is worthless...

any questions?

GLN

[DG]

Posted by: Greg | Wednesday, January 06, 2010 at 02:29 PM

Greg, Neely didn't use the word "afraid", actually, and his point about long-term bears turned bull is pretty standard "contrarian" logic, no? Applying it at the end of a huge rally in the face of deteriorating fundamentals (yesterday's pending home sales number, prime mortgages, etc.) is also a pretty standard time to apply that logic, too, no? Wasn't that one of the reasons why smart money started flowing into the dollar, because sentiment surveys showed that basically every dollar bull had capitulated? Where's the dollar now, relative to then? If you've got something that says now is not the time to apply that logic, fine, but very good traders have been making money being contrarians for centuries, so it's hardly something that Neely can be blamed for at least considering as part of his trading strategy, is it?

Yes, he missed the rally. I think that's been well-established. I just finished a very time-consuming process of going back through each and every trade he's recommended over the past 3 1/2 years and in the same time that the market's been negative by about 10%, he's made his Weekly trade subscribers 34% with very little risk (max risk of 2% on each trade) and no leverage, with a maximum drawdown of 6%. So, yes, he lost the March 2009 rally battle, but he's winning the war, no? You seem like a savvy guy, so you tell me how many retail traders made 34% pre-tax on their trading portfolios over the past 3 1/2 years, taking such small risk on each position and with that kind of equity curve? I'm more of a "just the facts" kind of person, so I could do without some of the less quantifiable statements Neely includes in his newsletters as well, but I don't hold it against him.

[DG]

Finally you leave us....we are NOT going to miss you!

I never meant to imply you would.

[Glenn Loser Neely]

DG alias Neely Shill,

Please be honest....

Are you in love with me?

Glenn

[nspolar]

GLN:

Your prediction # 11 imo has a chance.

I bot and read Neely's book. Thought it was very good and gave a decent technical side to classical EW, with some nice enhancements. I subscribed to his service for about a year (SPX and GOLD wave counts), perhaps a bit longer. To my surprise he no longer seems to use a good portion of the material in his book. Guess he decided it was all garbage. Wonder if I can get a refund?

Hard to believe that during all that time all he could come up with was abcde... fg ... add infinitum shit, with X waves. Not a single impulse or impluse like wave per recollection, during that whole period.

IMO Neely has either out smarted himself with his new methods, or is conducting a mind fock of sorts to the public. I did study his supposed new found methods as best I could (he has some archives and papers in his website). What is really intriguing and possibly even amazing is that he does not even repetively and consistently use these so called present methods, as best I can tell.

Now think about the mind fock? His followers might think the great GN knows what he is doing, so they follow him religiously. Now Neely does not want his work copied, is paranoid and all that, so what does he do? Makes up a new Noewave embedded coding of sorts to keep everyone but Yelnick confused (Yelnick an assumption on my part). Unfortunately he has to explain a bit, and use the words up, down, sideways, if not for this, no one would understand him.

All in all I will say that my Neely subscription resulted in disappointment, and I have been drawn back to more classical EW. I found I could always, if I tried hard enough, take one of Neely's interpretations, and come up with the very same conclusion using classical EW, per the methods outlined in his original book.

So where are we today, imo?

I am with Caldero and think the DOW topped in a 3rd wave on ~ Nov. 1, 2007.

Since that time I believe the DOW has done an ABC to a bottom on March 9 2009.

It appears a probable B up is near complete, and possibly a triangle, from that bottom to a top seemingly close at hand. Hence I expect a C down soon, to form the first [A] bottom, likely in 2011. This is going to be a long mother.

The vth wave of the C (of the ABC) is interesting and right out of Neely's book. Vth waves in this position can be triangles.

The vth of that C, an abcde triangle, started about Oct. 13, 2008 and ended at the C bottom (early March, 2009). Not what Neely has however.

A 127 % retracement of that triangle is about right where we are at today. It certainly would not be illogical for the retracement to fib off that ending vth wave triangle. Additionally the B has so far taken about 61 % of the time, of the whole A, a prerequiste more or less.

So I look forward to next week to see what happens. I think we are at a possible juncture, technically. To blow this out of the water the indices would have to punch trough with mo here, which they do not seem to have.

Predicting a big down here is not difficult, just consider the fundamentals. We have our government outsmarting themselves as well, just like Glenn Neely. There is no worse outcome to be had, than to be economically lead by a bunch of folk who believe they are smarter, better and more clever than anyone else. Most of these goons have no idea of what it is to think logically and be just a common person. It has turned into a Mafia of sorts, with multiple players and parties (lot of lawyers too).

Maybe we need a resurection of Hoover, an engineer type, who had the balls during the Great Depression to tell the bankers to go get focked. Certainly none of that here today.

As far as bottoms go ... something else might be of interest. It is possible the move up in the DOW from about the 2500 level was all an extended 5th wave (of a III'rd). These often get retraced, in their entirety.

Martin Armstrong makes for some good reading.

http://www.martinarmstrong.org/economic_projections.htm

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