Buy The Dip?

The biggest drop since last August got the bears out of their hibernation, as well as the triumphant buy-the-dip crowd. This drop so far is but a blip in a relentless rise, and buying dips has been the right approach. Zerohedge made fun of it in a series of BTFD pictures (parent alert - risque language), my favorite being:

Neely jumped on this today with his second top call. His first was in June 2009 after the initial runup off the March 2009 low. It tainted his reputation when the market turned inexorably back up, so this call is all all-or-nothing move by him:

Applying NEoWave’s advanced market confirmation techniques, Mr. Neely explains that today’s collapse confirms the end of an old pattern and the start of a new one. This new pattern suggests a 1- to 2-year bear market has begun and will likely result in a 30+% drop in market valuation. ...

Instead of financial institutions and real estate markets being devastated, Mr. Neely suspects the most likely justification for this future market decline will be severe financial problems for federal, state and local governments. The result could be local and national transportation disruptions, public service problems and government employee layoffs around the country. Other circumstances that might justify a 30+% decline in the stock market could be a substantial increase in the cost of energy or a drastic increase in the value of the U.S. dollar (i.e. deflation).

So Neely is calling for the bursting of the final bubble, the Government Bubble. Could be. "Austerity" is the new black. States are all cutting back. The irony of the protests in Wisconsin is that the protesters are trying to hold onto the status quo, whereas the Libyans (and Egyptian, Tunisians et al.) are trying to upend it. Which side is history on? We shall find out. 

Neely's logic on the USD is that once the Government Bubble bursts, the stimulus and subsidies end, leading to improving the prospects for the currency. Why? A falling currency is really a bet against unsound government policies; and at the same time rising gold becomes a hedge against bad government. At some point excessive stimulus/subsidy/easy-credit has to end, and we may have reached that point. Deleveraging will follow, with a vengeance, and the Dollar will soar. 

No surprise then that commodities took a huge fall today, other than oil of course. 

Tony Caldaro also went bearish: he says a "significant pullback" has begun. He was the first major wave analyst to turn bullish, and gets credit for being on the right side of market history for the past year. He remains mid-term and long-term bullish. His prognostication is crisp:

Technically, the market has just experienced its largest pullback, (32 points), since the Intermediate wave four low at SPX 1173 in November. The short term OEW charts suggest that the SPX 1344 high ended Minor wave 3 of Intermediate wave five. Should the high of Minor wave one at SPX 1303 be penetrated by this pullback, then this count would be questionable and Major wave 1 may have completed. Should the SPX 1303 level hold during this pullback a Minor wave 5 rally should follow to new uptrend highs. With support at the 1313 and 1303 pivots it appears to be “make or break” time for this Major wave 1 seven month uptrend. 

Normally we would expect a bounce tomorrow, and then the real test. Sp1303 is not that far from the low today at 1313. Robin Landry put out a bulletin a little more cautious than Neely or Caldaro that explains what to look for: 

If events in the middle east worsen overnight we could see the market accelerate to the downside. The decline today broke the trend channel on the hourly chart so a rally back to the underside of the trend channel at 12,300 area would not surprise me before turning back down

Even more cautious is EvilSpeculator, with an admonition of "Don't Be Stupid!" They had expected this drop, but warn that it is not yet time to go fully short. Their advice is to fade the buy-the-dip crowd - a delicious twist on the dippers' fade-the-bears strategy (which has been working!) - meaning go short once we see a double-top:

We have dip buyers at every step of the way through this rally. What we want to see is that the dip buyers, even POMO powered, cannot push it to new highs. At that point the fix is in.

A general theme across the punditry is to wait for a little more downside before calling a bifurcation down. You can see how in this chart from Contrarian Advisor we have just come down to a recent low without breaking it, as a bifurcation needs to do:

MarketThoughts also charts how all we have done is come down to the lower trendline. A break is needed, and usually after the break a bounce to retest the trendline from below. If it then fails (the "kiss goodbye"), we have a bifurcation & with it confirmation of a trend change:

Finally, number of pundits noticed that we broke down off a bearish wedge, and came down in a five-wave pattern, which denotes a trend change. The question is always what degree of trend? WavePrinciple sees this as a minor degree, but notes that a five-wave start suggests a bounce tomorrow and another five-waver down in a classic sharp correction:

 

Playing with the wedge concept, if we fell 32 pts peak to trough, a normal wave B bounce would be back 50-62%, or 16-20 pts, meaning back to Sp1330-1334. A final wave C of a sharp correction would normally go 32 points again, targeting the Sp1303 area that Tony Caldaro thinks is critical. To make it simple, watch for a break of 1300 before getting unbearably excited. 

Comments

[Grand]

Hi Yelnick

Thanks for posting one of my charts. But to be fair, that is not my primary count.

http://waveprinciple.blogspot.com/2011/02/eod-update.html

and here's the bigger picture

http://4.bp.blogspot.com/-TCZEi24ahyo/TWQju-EifCI/AAAAAAAAG0s/2ui6tvfuPdo/s1600/main.png

Cheers!

[yelnick]

Grand, thanks for updating for my readers. If I understand your count, a small wave 4 completed today, so we should expect a reversal to new highs?

[Jose]

Here is the real scoop on Neely.

The market bottomed in March of 2009. Neely did not come close to predicting the exact low, in fact he thought it would go much lower, like to 500 or lower. Here is Neely's most famous call. It was broadcast the world over. Neely was going to show everyone how good he really was. This was June of 2009, post the last big bottom. A very famous call, NOT.

“Technically speaking, according to NEoWave a correction began at last October’s low; the March-June rally is the final leg of that correction,” Neely explains. “The March-June rally is now ending, allowing the bear market to resume. During the next six months, the S&P will decline 50% or more, breaking well below 500!” Currently, the S&P is hovering around 917."

Things did not go as Neely opined. But he clung to something of similarity for a long long time following that. The following are Neely's words, let us just say about Sept 2009.

"In January 2008, I warned customers and the public that a massive, new bear market was underway. That bear market unfolded almost exactly as originally predicted on both a price and time basis. It seemed almost impossible, at the time, the U.S. stock market would experience a 50%+ decline in less than a year, but that was what NEoWave theory told me and that is what occurred.

As I have said many times in the past, as a market moves toward the center of a large, complex corrective formation, predictability becomes more and more difficult. It usually reaches the point where you can;t predict what will occur next, confusion is high, inaccurate forecasts are common, everyone is looking for answers (when few are possible) and a level of public agitation or irritation is obvious.

That point of confusion is exactly where the S&P is right now. After a year of extremely accurate market forecasts (I was in Timer Digest's Top 10 repeatedly the last 12 months), the S&P is now in the dead center of a 15-20 year, complex correction that began September 2000. Until the S&P moves far from this part of its structure, I will (at best) be able to predict general market direction, but not specific day-to-day behavior. This same phenomenon occurred from 2004 to 2006 when I knew a "bull market" was underway, but I could not predict, with wave theory, exactly how it would unfold.

The continuing rally in the S&P has forced me to reconsider the design of the bear market from January 2008. Initially, I thought it would be a complex correction that pushed to new lows at least once more before the lowest point of this 20 year bear market was reached. But, recent action brings into question that assumption and raises new possibilities. For that reason, I went back to my S&P archives and looked up the various scenarios I originally created for the 4+ year bear market starting January 2008. Attached is one of those scenarios that still explains the past, fits current evidence and explains the magnitude of the rally off 2009's low. If correct, the 2008 to 2012+ time frame is a contracting Triangle that will eventually end much higher than 2009's low. It also means 2009's low will not be broken for the next 50 years!

This feels eerily like my call in 1988, just 8 months after the 1987 crash low, when I was the only wave analyst in the world predicting 1987's low would never be broken for the rest of my life. The count attached to this email is not yet my "official" wave count, but it is quickly becoming a serious choice. Over the next few weeks it should become more obvious the path this phase of the 20-year bear market will follow."

Charts continued to accompany this hysteria, and showed an 'A' bottom higher than Neely predicted, followed by some small 'B' rebound, a 'C' decline, a 'D' rebound and an 'E' decline to an end of wave count per Neowave, for the bear. The noted rebounds were much lower than what we experienced, and in fact the pattern we have experienced shows no resemblance to this prediction.

Neely clung to this concept for a long long time, and as bantered about on the web made repeated short attempts with his trading.

Following all of this incorrect predictive prowess on Neely's part we then would up with the infamous "it's an unpredictable market" paper on Safehaven and elsewhere.

He has another paper out on trading strategies, latter half of 2010. I dunno but maybe one trading strategy would be to know when to fade Glenn Neely.

To say that Neely called two tops is an understatement. That is how I feel about it.

Jose

[Jose]

I do not know why bloggers blog. Most are likely in it for money, one way or another.

Remember that, whilst you read any blog.

And as far as the paper sellers, take very careful stock of what they are peddling. When they make bold statements, write them down and keep track.

We have two from Neely, the first one was the S & P to 500 or lower. Did not happen. Was not even close. So he followed that with his unpredictable market paper. Was this by design, or all in honesty?

Now take stock of Neely's other line in the sand statement.

It also means 2009's low will not be broken for the next 50 years!

When someone like Neely comes out with something like this, write it down.

Mamma more than likely has part of her view straight imo. Very straight. She tells it like she sees it and I for one respect that. Mamma ain't peddling papers.

That however does not mean we can not have one hell of move down, followed by a huge move up. A 'B' at 78 %? Time will show, and a Fractal to boot. Hank is a paper peddler. Sorry Hank, it is true. Fractals are not the reason for Ewaves. My opinion and I am sticking with it.

I would bet Lump of Coal Michael is watching and reading, and making up his own mind.

Jose

[Jose]

And to follow up here is what Neely sent out today. Another line in the sand statement, or ..... you be da judge.

"February 22, 2011 – Today, the U.S. stock market experienced a major selloff, falling more than 2%. According to Glenn Neely, Wave theory expert and founder of NEoWave Institute, this confirms the end of the rally off November 30, 2010’s low and probably the end of the bull market that began at 2009’s low.

Recently, Mr. Neely warned subscribers to the NEoWave Trading and Forecasting services that a “major event” was on the horizon. In preparation, Mr. Neely instructed trading customers to go Short, right at last Friday’s high and clsoe, which is currently top-tick of the month!

Applying NEoWave’s advanced market confirmation techniques, Mr. Neely explains that today’s collapse confirms the end of an old pattern and the start of a new one. This new pattern suggests a 1- to 2-year bear market has begun and will likely result in a 30+% drop in market valuation.

While economic conditions have improved greatly since 2009’s low, NEoWave warns a new downturn (lasting 1- to 2-years) is beginning. As is always the case, markets anticipate future economic reality. While news has been improving, wave structure warns the U.S. stock market has turned a corner, setting the stage for an “echo” of the 2008/2009 financial crisis – but this time with a new twist. Instead of financial institutions and real estate markets being devastated, Mr. Neely suspects the most likely justification for this future market decline will be severe financial problems for federal, state and local governments. The result could be local and national transportation disruptions, public service problems and government employee layoffs around the country. Other circumstances that might justify a 30+% decline in the stock market could be a substantial increase in the cost of energy or a drastic increase in the value of the U.S. dollar (i.e. deflation)."

Jose

[Wave Rust]

Grand
kinda agree with the 3 day scare the crap out the neo-bulls ,,,, then higher ,,,, i would agree more probably, if i saw what you have for 1998 to 2009 low ,,, got a weekly chart?

for me, spx1390-95/dow 13,125 is minimum move before a possible really good dip again of 10% or more. might be at the time that Yelnick sings the funeral dirge for QEII in late may or early june.

spx 1280 will be a great 'back up the tractor trailer' point, if it gets there next week.

i don't see the ME crap as anything but temporary excuse for throwing some people under the bus ,,,, mainly those who have been saying for months that "we need a correction", "too far too fast", "technically blah blah"

daytrading this piggy is about the same ,,,, it just seems longer than a day ,,,, and you really have to have a grip on the 5 min or lower timesframes. So, i really like and thought the same as your "multi overlap chart".

may take 2 days for sluggish B bounce then C into next week ,,, looking for a flat. good job there.

some people don't think much of intraday wave counting, but i been doing it sooo long that i don't know what they are missing when simple waves are there and so obvious.

wave rust.

[PR]

Don't Anticipate... REACT! Expecting is the greatest impediment to living. In anticipation of tomorrow, it loses today.

[Greg]

I subscribed to Neely during first half 09 and it cost me a lot. When I see guys like Prechter or Neely rushing out to send emails with market calls I take it as a JOKE. A BAD JOKE. The lesson one can draw from following failed pundits is that if you have to rely on someone but yourself to trade then DON'T. If you really really really need to believe at someone/something then choose a religion and follow it. It will be much less costly.

[DG]

When someone like Neely comes out with something like this, write it down.

You mean like I've done with every Neely e-mail blast of the last 4+ years?

On balance, he's accurate, including the last couple of failed predictions. No one is perfect, nor do they need to be to be successful at trading.

Following all of this incorrect predictive prowess on Neely's part we then would up with the infamous "it's an unpredictable market" paper on Safehaven and elsewhere.

While I agree that article was self-serving, especially the timing of it, there is a very important insight embedded in there about what is and isn't predictable during specific market regimes.

I am probably the only person who's ever compiled Neely's track record cut by "Progress Label", i.e. how does he do in "wave-A"s (which are more predictable) vs. "wave-B"s (which are less predictable), etc., and I can tell you that the results do substantiate his claims about the relative predictability of markets. If you only traded with Neely's recommendations during "wave-A" environments, you'd do quite a lot better than if you traded all of his recommendations. The trick, of course, is to discern which is which. I've come up with some ideas and they are useful, but I have no reason to share them with anyone here.

I subscribed to Neely during first half 09 and it cost me a lot. When I see guys like Prechter or Neely rushing out to send emails with market calls I take it as a JOKE. A BAD JOKE. The lesson one can draw from following failed pundits is that if you have to rely on someone but yourself to trade then DON'T. If you really really really need to believe at someone/something then choose a religion and follow it. It will be much less costly.

No, the lesson is to do your due diligence. Neely's archives are open to subscribers, so you can check out his track record and see which timeframes and services are most accurate. Even in early 2009, analysis of the historical data would have said that you should only take either the Daily or Weekly trading suggestions on the S&P (I didn't look at all of the services, so there may have been a better option among the other markets he follows). In point of fact, from the beginning of 2009 to the end of June 2009, i.e. the first half of the year, Neely was up on all timeframes, primarily thanks to a monster gain on his calling the bottom in March 2009. If you lost money, it was probably from deviating from his recommendations.

While I agree that ultimately the best outcome for a trader is to find an "original" positive expectancy methodology, there's no reason that a trader can't leverage someone else's method as well. vipul, whom I consider the best of the "big picture" posters here, leverages NeoWave, for example. Why re-invent the wheel, especially in trading, where there's nothing new under the sun?

Anyway, like I said, that 1340 level was significant on some Degree. We'll see if it's the Degree which determines the intermediate term trend or not.

[?]

Duncan,

"Playing with the wedge concept, if we fell 32 pts peak to trough, a normal wave B bounce would be back 50-62%, or 16-20 pts, meaning back to Sp1330-1334. A final wave C of a sharp correction would normally go 32 points again, targeting the Sp1303 area that Tony Caldaro thinks is critical. To make it simple, watch for a break of 1300 before getting unbearably excited."

*******

A small math error.... 50 to 62% retrace would be 1328.25 to 1332.

[Wave Rust]

DG
I'd be interested in your findings about the Bs, when you are so inclined.

if we're lucky, the A completes this mornin and then the B imo.

wave rust

[upstart]

Bonds are within a gnats whisker of confirming an end to the downtrend. They have almost rallied above where wave 5 down (of C of the large flat) began at the end of a 4th wave triangle. (Wave C down of the large flat began in August 2010.)

[upstart]

That would make a running flat.

[Mamma Boom Boom]

Grrrrrrrrrrrr.

[da bear]

Mamma, here is a link to At The Crest of the Tidal Wave. I guess it is free now.

link: http://books.google.com/books?id=JfCQhWstC7wC&pg=PA473&lpg=PA473&dq=Figure+5.7+At+the+Crest+of+the+Tidal+Wave&source=bl&ots=HMYmSMkGge&sig=vCtANcUQAL4K2w3FfWs5MQ_701w&hl=en&ei=N0VlTcO1CIH68Aac4rz1Bg&sa=X&oi=book_result&ct=result&resnum=1&ved=0CBkQ6AEwAA#v=onepage&q&f=false

Now, on page 79, Figure 5-7 shows the ALTERNATE of alternate counts for this huge bear market. Written in 1995, it makes the bear market a LARGER version of the 1987 crash, with a higher B wave. If you read the text, the DJIA, would go down in wave (A) then rally to 16,000.

I think that (V) of Three topped in 2000 being the orthodox top, then wave (A) of the bear market bottomed in 2002/2003, then the (B) rally to DJIA 14,195ish which ain't too far off of DJIA 16,000. Since 2007, wave (C) down has been in force, with wave I taking the DOW down to 6,400 in March 2009. Then the wave II rally up since which probably just ended (five waves off the low are in, FYI the wave iv of this II is the Flash Crash and following corrective move, the wave ii is the first decline from DJIA 9,000 to DJIA 8,000 which corrected 38% of the wave i run from 6,400 to 9,000). So now wave III down is in force. This Figure 5-7 (which is like the mother of all alternate counts) could take the DJIA BELOW the 1932 low. But, DJIA 1,000 makes more sense.

da bear

P.S. The text referring to wave III of (C) comments on how the entirety of the MASSIVE drop could take place in less than 3 months.

[Mamma Boom Boom]

>the entirety of the MASSIVE drop could take place in less than 3 months.<

That, actually, is something I've been contemplating.

Other than that, I do not concur. I think everything that has happened since 2007 is of new making, unrelated to the past.

[Hell's a comin]

FLASH CRASH, II!

[Jose]

"That, actually, is something I've been contemplating.

Other than that, I do not concur. I think everything that has happened since 2007 is of new making, unrelated to the past."

Take Prechter, Neely, and Yelnick predictions. Average and divide by PI. Will come out about right.

1000 plus 8000 plus 6000 ? divided by PI is 4774. Throw in plus or minus 33.33 % for error.

Keep it simple. Remember something will happen to allow each of these some degree of redemption, so they can stay in business, blow or do whatever it is they must do.

The predicted value gets down towards the '87 top which is key ledge that should hold. It is like a magnet, pulling the bulls back into the abyss and attracting bears like hives of honey.

Maybe DG should run some statistics on all this, and come up with a probability.

Jose

[Mamma Boom Boom]

My guess is this first leg down has hit exhaustion. The retracement will be worth a million.

---------------------------------
Jose, for now I'm sticking to the thought that the March 09 low is taken out. That will complete 5 waves on some charts.

Neo-Mamma

[Hell's a comin]

Mamma and DaBear doesn't victory feel SWEEEEET?

I am loading up on puts and very pleased indeed. The best is yet to come... but it won't take long now!

[vipul garg]

KRG,
thanks for your note.appreciate it.it was good to get those forecasts right. crude is 100$!!crude analysis was special for me since it went contrary to almost everyone that time when it was about 70$ including rakesh jhunjhunwaala .
As i had written, i am on 'trading' leave these days.not even seeing the charts really.but still will try and fill in whenever possible.

DG,
thanks for your kind words.

[Hell's a comin]

Let me make it simple for you.

BUY this dip and you say good BY to your money.

[Hell's a comin]

Last chance to stock up on puts. Tomorrow will be too late.

[Hell's a comin]

It is now 2:45. The dow is down 100. It will close down 300+

[Feb 17 2011 Bradley Date]

WOW!!!! WHAT A BRADLEY DATE!!!

Feb 17, 2011!!!!

http://forbestadvice.com/Money/Gurus/DonaldBradley/BradleyTurnDates2011.html

[Feb 17 2011 Bradley Date]

2011 Bradley Turn Dates List

3 most important dates

Feb 17, 2011
July 29/30, 2011
December 28, 2011

Other Bradley Turn Dates
· 1/16/2011
· 2/3/2011
· 6/15/2011, 6/22/2011
· 8/20/2011, 8/30/2011
· 9/26/2011
· 10/12/2011, · 10/28/2011
· 11/22-23/2011

[Doption]

1st step down complete.
Clear picture short term.
chart: http://twitpic.com/4306yb

[watch out for rally]

everyone is too bearish

watch out for a soaring rally to new highs into early march

[Mamma Boom Boom]

Tomorrow's probably going to have the bulls slobbering all over themselves.

Ne0-Mamma

[Hell's a comin]

You tell 'em, Mama. I forsee major tears in the bull camp tomorrow morning when futures are down 500.

We are looking at the eye of the storm and most people don't even know it. It's like whistling dixie through a minefield.

the only reason we didn't close down 300 today is "gubmint", in other words Berknake "Ben" heliopter and his goldman buddies jamming the futures by manipulating the soes and the options chain.

the fed is the enemy of hard money

[LDA]

Yelnick et al,

What are we to make of how the dollar, commodity prices, bonds and the equities are behaving? At this stage it seems like the dollar should be moving higher even with the higher crude. There are a lots of stories that some large macro/hedge fund is closing large positions in some of the ag markets, currencies and brent crude. Could the wave practioners offer up a count on the dollar index?
Thanks/LDA

[joe]

I would be pretty surprised if the market is not up tomorrow. If it does not go straight thru SP 1298 and hold it, I think the correction is premature. If it gets above 1318 and holds it I think that would confirm it.

Just IMO

Joe

[Wave Rust]

short crude anyone?

wave rust

[twitter.com/Frac_Man]

Today's Top Tick trade is on the Home Page

And also an Amazing Oil Fractal that

predicted the Rally

http://www.elliottfractals.com

[Hockthefarm]

DG:

My problem with Neely (and others for that matter) is this:

Per the above posts his recent track record has been poor.

Yet in spite of that he thinks he knows what the market will be doing a year or two from now:

"This new pattern suggests a 1- to 2-year bear market has begun and will likely result in a 30+% drop in market valuation."

Heck, I don't even know what I'll be doing a year or 2 from now. I don't believe he has any idea what the market will be doing a year or two from now.

Hock

[Wave Rust]

hock,
I think neely's wrong too but then maybe I'm wrong. I don't really care. I just want the market or some market to move, sose I can trade it.

I can see a bull market for the next 3 to 5 years ,,,, just grinding up and up with a few spills down like the current one to keep things interesting.

I can see neely's sideways bear too ,,,, not too probable but possible. he datrs the end when QE II comes off.

Remember that QE I was just called the 'quantitative easing' until somebody mentioned a second round.

what's to prevent the "need" for a turd round of QE with the Oblahmaganda machine in full election mode from Oblahblah Campaign HQ in Chicago Ill-noise? Not a darn thing!

repubs won't balk if unemployment is back above 9.3% in the fall of 2011 !

wave rust

[Wave Rust]

anybody short brent or WT crude?

I'm wanting to sell it

wave rust

[Hockthefarm]

wave:

"what's to prevent the "need" for a turd round of QE with the Oblahmaganda machine in full election mode"

Exactly. My sense is that both Prechter and Dent really misjudged the impact of gubmint and the Fed.

Then again who ever thought that these folks would be able to slaughter the tax payer to keep a handful of very poor business men whole and happy. The real tell is that the American citizenry is sitting around asking for seconds, make that thirds.

Maybe it is screw job 6 or 7 that wakes up the masses. The bond market sure doesn't mind this round, that is for sure.

Maybe the tell will be when The Bernank gets knighted by the QofE.

Picking a top with the rules continually changing looks pretty tough to me.

Hock

http://www.safehaven.com/article/20036/a-random-walk-around-the-frontlines

[DG]

Hock,

It's all a matter of probabilities. Over the longer-term, Neely's record of calling major turns is better than chance would dictate. So, why sweat one or two missed major turns, other than the fact that one may not have made money on the upside because of them?

I've posted about a dozen times how I think Neely could have done things a lot differently over the past couple of years, but I've never thought it was a huge deal that his forecast in 2009 didn't come to pass. Is it embarrassing for him? Sure, but it's one market call out of the 30 or so he's made across the years I've followed him.

None of which means he's right in his current forecast, of course.

[Wave Rust]

hock,
I know people think i'm a perma bull ,,,, don't care ,,,, but a top is so far off in time and in price that I really can only give a half arsed guess. But spx 2500 is a lock in my opinion.

the irony is that all media continue to "say" that this is a trader's market ,,,, too dangerous etc for the average joe 6 pack investor. I think it is exactly the opposite. Just frikkin buy a great company you know, with good management currently and historically ,,,, good bal sheet and income stmnt ,,,, like the current dogs of the dow ,,,, like INTC ,,, how cheap is it? ot ATT or mrk msft bac ,,,, and on and on

long term this is such a "wish I had bought back then" moment ,,,, 5-10 yrs from now.

it IS the ideal time to buy ,,, how often do you get a chance to buy generational lows in stocks? answer: once

bond investors who are still scared are gonna lose even more money in the next decade ,,,, with or without Oblahblah.

dats market irony for ya

wave rust

[yelnick]

LDA, I didn't see any takers on your question (why USD is not higher with crude, what's up with commodities). Oil/Dollar should be somewhat inverse, so higher oil = lower Dollar. (Remember that DX was hitting 120 in '99 when oil was bouncing along at $10.) The oil spike might be causing the current Dollar weakness and Euro strength relative to expectations. Everyone is expecting oil to rise (97% bulls) so it may be within a week or two of peaking. Hence look for the oil/dollar dance as things remain volatile, then USD up/Oil down, surprising the herd. Dollar up likely means commodities down with some local exceptions (weather related). 

[yelnick]

Doption, thanks for sharing your chart & count. We seem to have hit five waves down at Sp1300 (1299.55) and begun the counter-trend bounce with a possible A wave and start of B, but too early to tell. So far 44 pts down and a bounce of 13 with expected bounces of 22 (50%) to 27 (62%) if this is a normal wave 2 bounce. Look for 1325. Tony Caldaro has more precise pivot targets. 

[Dsquare]

"it IS the ideal time to buy ,,, how often do you get a chance to buy generational lows in stocks? answer: once"

Wave Rust, that's not really very logical. Should have about a 18 year plus sideways move from 2000. At the end of long bear markets, PE is similar to dividend yield so stocks were still overvalued in 2009 compared to what they should ultimately be.

From Tim Wood: At the 1932 bear market bottom the yield was 10.50% and the P/E was just under 10. At the 1942 bear market bottom the yield was 8.71% and the P/E was 7.3. At the next great bear market bottom in 1974 the yield was 5.9% and with a P/E of 7.24. If we take this same reading at the 1982 low the yield was 6.2% and the P/E was 6.9. For the record, these P/E ratios are based on Generally Accepted Accounting Principles and not the bogus George Orwellian methods of today. At the 2009 low, the P/E was 26 with a dividend yield of 3.2, which is hardly at par. http://www.financialsense.com/contributors/tim-wood/dow-theory-update-and-values

[Mamma Boom Boom]

>I know people think i'm a perma bull ,,,, don't care ,,,, but a top is so far off in time and in price that I really can only give a half arsed guess.<

Wave, if you can live with 50%-70% corrections, then you're right, it's just one big bull market.

[Virgil]

Dollar testing & retesting its 3 year trendline support. Will it hold?

[Mamma Boom Boom]

Gaddafi's Private Plane, Reportedly Loaded With Gold, Ready To Leave For Zimbabwe As Early As Tomorrow

----ABC.net.au--

[da bear]

Mamma,

Figure 8-3 in Elliott Wave Principle (Prechter & Frost, 1978) projected the bull market then the huge bear market to follow.
A huge rally like the 20's then a peak, a decline, a new high, then an incredible, swift crash. They have the nominal peak as the 5, but I think the first peak should be a 5, then an A, B, C move.

It is very similar to the chart depicted in At The Crest of the Tidal Wave -- or at least the crash portion.

here is the link to The Elliott Wave Principle.
Figure 8-3 is on page 95.

The circled 4 is probably the Crash of 1987, and the the next peak should be the 2000 top.

Their circled 5 is better labeled as the B top (2007).

da bear

[Virgil]

>"Gaddafi's Private Plane, Reportedly Loaded With Gold, Ready To Leave For Zimbabwe As Early As Tomorrow"

trendline cabestro:

http://i53.tinypic.com/156cvop.jpg

Aussie dollar still bouncing around in its wedge

[Hockthefarm]

11% to 16.8% decline coming in the spx?

http://www.businessinsider.com/tom-demark-cnbc-2011-2

Hock

[Mamma Boom Boom]

da bear, no link. But, for now, I'm pretty much stuck with my view that a new world started in 2008.

--------------------------------

Virgil, that's an interest point of view. I wonder how it works, back tested?