This is just a quick note, prior to this weekend's detailed comments about the State of the Markets. Today's brief dip under 8000 is UNLIKELY to be the low we are looking for in this time frame. 6500-7500 remains the range where that low should happen, and the next few days to weeks is the range in time.
Friday is the last day for rich investors in hedge funds to notify the funds of their desire to withdraw funds on December 31. So, between now and the next few days to weeks, those funds that have been notified that they need to produce cold, hard cash will be selling more holdings to avail themselves of cash for distribution. Therefore, today is a low probability for the low of 2008, but again, we're very close...much closer to the low than the high. Any probing under 7500 will get us excited; probing under 7000 will get us exstatic; and under 6500 will get us arrested!
From this low, whatever the final number turns out to be, we expect a 30%-80% rally in the following 3-9 months. Unfortunately, that rally will eventually give way to the slaughter of 2009/2010. First things first though, and a major low is imminent!
Check in this weekend for massively, wealth enhancing information.
For what it's worth,
Ken
Nov 13, 2008
Nov 6, 2008
BE CAREFUL WHAT YOU WISH FOR...
Like our election day warning said, "buy the rumor, sell the news" and THEY have sold everything hard ever since Obama spoke those words that will also live in INFAMY: "Change has come to America"!
No doubt change has come, but will it be the change we need, or the change THEY tell us we need? Noone can still believe THEY are doing what is "our" best interest anymore, not after the lies and denial of the past year, let alone the past 10 years. Whether it's the "weapons of mass destruction" that never were found, or the "recession" that we are technically NOT in, is there a single truth that anyone can point to that has helped us recently?
Let's hope that the change that has come is at least honesty! If life is getting worse for the masses, let's hope that we can know in advance, and prepare, rather than being left to hold the empty bags.
Be cautious what you wish for...is it worth the price? What is the cost/benefit ratio? Who is the grantor of the wishes, and what are they getting out of the deal? These are questions that are hard to ask when we're in personal pain, but must be asked. Otherwise, the current pain we are trying to get rid of proves to be nothing compared to the pain we suffer for acting emotionally at the wrong time.
As Rummy so eloquently said, "There is the stuff we know we don't know that is the unknown". We can all agree that we have a little better handle on this concept today than we did a year ago. But, compared to what we still don't know, what we know is not worth knowing.
To tie this all together from the wisdom of the past several comments of the past month, much of which I collected during years of personal research and work around the country with experts in their fields, the main engine of our decision support system is targeted to uncover what they are "doing", rather than what they are saying.
So far, while dreaming about the future and how it will look once change comes, THEY are still selling everything that is not attached to the floors and walls including: crude, euros, stocks, gold, and bonds. Why? Because the massive multi decade bets that THEY'VE been playing, with the help of those in power, are no longer playable. And they want out of the game, NOW. So, everything is for sale until they know the new game, which will take several months to know and learn. Until then, there is no price support, no matter what is being talked about. In other words, don't rely on Dow 8000 holding, as it means nothing to those that need to raise cash at all costs.
CHANGE HAS COME to America my friends, even if this is not the change you expected.
For what it's worth,
Ken
No doubt change has come, but will it be the change we need, or the change THEY tell us we need? Noone can still believe THEY are doing what is "our" best interest anymore, not after the lies and denial of the past year, let alone the past 10 years. Whether it's the "weapons of mass destruction" that never were found, or the "recession" that we are technically NOT in, is there a single truth that anyone can point to that has helped us recently?
Let's hope that the change that has come is at least honesty! If life is getting worse for the masses, let's hope that we can know in advance, and prepare, rather than being left to hold the empty bags.
Be cautious what you wish for...is it worth the price? What is the cost/benefit ratio? Who is the grantor of the wishes, and what are they getting out of the deal? These are questions that are hard to ask when we're in personal pain, but must be asked. Otherwise, the current pain we are trying to get rid of proves to be nothing compared to the pain we suffer for acting emotionally at the wrong time.
As Rummy so eloquently said, "There is the stuff we know we don't know that is the unknown". We can all agree that we have a little better handle on this concept today than we did a year ago. But, compared to what we still don't know, what we know is not worth knowing.
To tie this all together from the wisdom of the past several comments of the past month, much of which I collected during years of personal research and work around the country with experts in their fields, the main engine of our decision support system is targeted to uncover what they are "doing", rather than what they are saying.
So far, while dreaming about the future and how it will look once change comes, THEY are still selling everything that is not attached to the floors and walls including: crude, euros, stocks, gold, and bonds. Why? Because the massive multi decade bets that THEY'VE been playing, with the help of those in power, are no longer playable. And they want out of the game, NOW. So, everything is for sale until they know the new game, which will take several months to know and learn. Until then, there is no price support, no matter what is being talked about. In other words, don't rely on Dow 8000 holding, as it means nothing to those that need to raise cash at all costs.
CHANGE HAS COME to America my friends, even if this is not the change you expected.
For what it's worth,
Ken
Nov 4, 2008
IT'S WHAT YOU KNOW YOU DON'T KNOW...
I'm hearing so many reasons why no matter what the market rally has begun, that I am forced to look for alternatives.
Like our ominous reminder of the old Wall Street adage last April, "Sell in May and go away" brought in the biggest decline in decades, today I'm forced to remind those that are either unaware or sippin' too much denial koolaide of an even older Wall Street adage, "buy the rumor, sell the news"!
Only moments after the biggest election day rally in decades ended, the naysayers began speculating about how bad a super majority of Democrats would be for the markets, and bla bla bla. If any of the reasoning even mattered, it might be interesting to listen to. But, it doesn't. Connecting thoughts or reasons to past events or future possibilities is a waste of time. If not that, then what?
Well, the strength of our decision support system is really two fold. First, it engages the only predictive market theory known to man (but typically misunderstood, therefore under utilized), which is the Elliott Wave Theory. Second, in addition to its ability to forecast what IS going on, Elliott Wave Theory reigns supreme in telling its disciplined students what IS NOT going on.
What IS NOT going on right now is the birth of a new bull market to new all time highs. What IS NOT going on is the salvation of the economy and markets by President Elect Obama.
What IS going on, based upon our decision support system, which leans heavily upon Elliott Wave Theory, is a relief bounce, which could be already over, to suck in more "little guy" buyers, so the Wall Street Insiders can sell the stuff they need to, before the next debacle hits.
Wall Street adage number three of the day: "Watch what they do, not what they say". THEY are deleveraging, THEY are selling, THEY are preparing for lower, much lower, prices in the months or years to come.
Whomever wins tonight, and it looks like it'll be Obama, God Bless the President of the United States, and more importantly, God Bless the people who pay for the mistakes, but receive no benefits for the egocentric actions of those we elect to govern and look out for us. As Obama says, "change has come to America". Let's hope he really does what he says he'll do. It's been awhile since we had a savior, but we're ready!
For what it's worth,
Ken
Like our ominous reminder of the old Wall Street adage last April, "Sell in May and go away" brought in the biggest decline in decades, today I'm forced to remind those that are either unaware or sippin' too much denial koolaide of an even older Wall Street adage, "buy the rumor, sell the news"!
Only moments after the biggest election day rally in decades ended, the naysayers began speculating about how bad a super majority of Democrats would be for the markets, and bla bla bla. If any of the reasoning even mattered, it might be interesting to listen to. But, it doesn't. Connecting thoughts or reasons to past events or future possibilities is a waste of time. If not that, then what?
Well, the strength of our decision support system is really two fold. First, it engages the only predictive market theory known to man (but typically misunderstood, therefore under utilized), which is the Elliott Wave Theory. Second, in addition to its ability to forecast what IS going on, Elliott Wave Theory reigns supreme in telling its disciplined students what IS NOT going on.
What IS NOT going on right now is the birth of a new bull market to new all time highs. What IS NOT going on is the salvation of the economy and markets by President Elect Obama.
What IS going on, based upon our decision support system, which leans heavily upon Elliott Wave Theory, is a relief bounce, which could be already over, to suck in more "little guy" buyers, so the Wall Street Insiders can sell the stuff they need to, before the next debacle hits.
Wall Street adage number three of the day: "Watch what they do, not what they say". THEY are deleveraging, THEY are selling, THEY are preparing for lower, much lower, prices in the months or years to come.
Whomever wins tonight, and it looks like it'll be Obama, God Bless the President of the United States, and more importantly, God Bless the people who pay for the mistakes, but receive no benefits for the egocentric actions of those we elect to govern and look out for us. As Obama says, "change has come to America". Let's hope he really does what he says he'll do. It's been awhile since we had a savior, but we're ready!
For what it's worth,
Ken
Nov 3, 2008
ELLIOTT WAVE THEORY PREDICTS NEXT PRESIDENT WILL NOT LAST A FULL TERM !
(click on chart to enlarge)
Ironically, this is the one election that you should actually vote for the candidate that you "LIKE THE LEAST". Why? Because after the short, but probably very sharp rally that is due to begin between October 10 and Thanksgiving runs its course into early 2009 (forming wave B, or the intervening rally between two down waves: A and C), the following decline which will be wave C should obliterate the market lows of 2002/2003, causing financial dislocation not seen in the last 100 years. That dislocation will very likely cause the expulsion of the current government, or at least the leaders, mostly at no fault of their own.
This "scape goating" will become rampant, and take no prisoners. With this in mind, if you are an Obama fan, you don't want him to win Tuesday, as he will very likely be laughed, chased, or worse out of office before the 2012 election. Obama fans should prefer to have him lose Tuesday and be the shining light as the "what could have been" when the stuff really hits the fan in the next 2-3 years. If you are a McCain fan, you don't want him to win Tuesday, since he will receive all the follow-on blame of the Bush legacy, culminating in his early dismissal, if he lives that long. If he loses, although he'll be too old to run again in 2012, Sarah Palin could be viewed as "should have been" choice back in 2008.
Either way, the wave pattern is unmistakable, and ominous. Once wave B up exhausts itself in the 11k-12k +/-500 points in early 2009, the largest decline since 1929 is scheduled to visit not only American markets, but this time, the global ones as well. This is the first time in history that diversifying was the wrong strategy. In fact, complete concentration of assets should be highlighted into the coming wave B rally in the next 2-6 months as my 11k-12k target gets approached: 100% cash or T-bills will be the only survival plan that works.
So, again, ironically, for the first time in US history, voting for your favorite candidate will guarantee his demise as a viable political entity in the future, whereas voting for your least favorite all but guarantees several elections to come working in favor of your preferred party.
As they used to say in Chicago in the glory years of political machinery, "vote early and vote often".
For what it's worth,
Ken
Oct 30, 2008
CLOSE, BUT NO CIGAR...YET ! BUT WE'RE SO CLOSE !
Again, the Fed's rate lowering had only temporary success in creating the Hope that Wall Street lives on, this time only 90 minutes, prior to the anxious sellers coming in to raise cash. There is so much pain and suffering (losses) that any and all chances to sell anything are taken without question. This is PERFECT for our call for a major, multi month, low coming to fruition in the next few days to weeks.
The GOP is pulling out all the stops to try to bolster the McCain ticket into election day. The Fed's secret PLUNGE PROTECTION TEAM is historically active in the pits, buying with both hands to keep the inevitable final purge from happening prior to Nov. 4th. However, just like the attempts of the past year didn't stop the 6000 point decline in the Dow, neither will these attempts stop the final 2000 +/- point decline into the test of the 6500-7500 area, which is needed to fulfill the pattern, into the wave "A" low that is due in this time frame. If they (GOP) can pull it off, it'll be a beautiful backup strategy. If Obama wins, which polls show is most likely, the collapse will occur just after elections and the blame will be placed on the "uncertainty of the untested Obama" presidency.
Either way, like the old saying, "you can't fool mother nature", we can translate that to the current, "the Fed can't change mother MARKET"! Nothing they've tried in the past year, and they've thrown everything they have at it, has worked. In a few days to weeks, the last wave of the initial decline from 14k to 6500-7500 will manifest and the buying opportunity of the past year will be presented. From there, the "head fake" uber-rally will blast emotion, hope, and stocks higher in an inauguration day extravaganza that will be celebrated as the coming of the market messiah. Get ready, as this bear market bounce is foretold!
The test of our belief, our souls, and our portfolios will come back in the 11k-12k area early in 2009. What will you do? If you don't prepare for that exit opportunity, you will miss the last chance to save your wealth from the most severe destruction of your life. The decline following this bear market rally into 11k-12k will make the slide of the past year look like hiccup.
Bottom Line: by the middle of December, we should not only have seen the final wave of this initial decline from 14k, but should be on our way back up to what will become the Spring Fizzle rally, that rolls over and makes 2009 the biggest bust year since the Great Depression.
I'll be posting entries for the rally in a few days, as we get closer to the 6500-7500 area.
For what it's worth,
Ken
The GOP is pulling out all the stops to try to bolster the McCain ticket into election day. The Fed's secret PLUNGE PROTECTION TEAM is historically active in the pits, buying with both hands to keep the inevitable final purge from happening prior to Nov. 4th. However, just like the attempts of the past year didn't stop the 6000 point decline in the Dow, neither will these attempts stop the final 2000 +/- point decline into the test of the 6500-7500 area, which is needed to fulfill the pattern, into the wave "A" low that is due in this time frame. If they (GOP) can pull it off, it'll be a beautiful backup strategy. If Obama wins, which polls show is most likely, the collapse will occur just after elections and the blame will be placed on the "uncertainty of the untested Obama" presidency.
Either way, like the old saying, "you can't fool mother nature", we can translate that to the current, "the Fed can't change mother MARKET"! Nothing they've tried in the past year, and they've thrown everything they have at it, has worked. In a few days to weeks, the last wave of the initial decline from 14k to 6500-7500 will manifest and the buying opportunity of the past year will be presented. From there, the "head fake" uber-rally will blast emotion, hope, and stocks higher in an inauguration day extravaganza that will be celebrated as the coming of the market messiah. Get ready, as this bear market bounce is foretold!
The test of our belief, our souls, and our portfolios will come back in the 11k-12k area early in 2009. What will you do? If you don't prepare for that exit opportunity, you will miss the last chance to save your wealth from the most severe destruction of your life. The decline following this bear market rally into 11k-12k will make the slide of the past year look like hiccup.
Bottom Line: by the middle of December, we should not only have seen the final wave of this initial decline from 14k, but should be on our way back up to what will become the Spring Fizzle rally, that rolls over and makes 2009 the biggest bust year since the Great Depression.
I'll be posting entries for the rally in a few days, as we get closer to the 6500-7500 area.
For what it's worth,
Ken
Oct 25, 2008
A Week That Will Live in INFAMY
(click on chart to enlarge)
CHART AU COURANT: This is it folks, the purge/plunge appears to be at hand. Whether it shows up this week, next week, or the week after, the test of 8000 that held earlier this month, will likely break in the coming days, setting up the ultimate test of the lows of 2002/2003. That number is 7200 Dow, 776 S&P, and 1100 Nasdaq. If these levels break, the next stops will be 5700-6300 Dow, 610-735 S&P, and 800 +/-50 Nasdaq. There is a very good chance that from the lows of the coming days, there will be a 50%-100% rally within the coming 6-12 months. It's rare that so great an upside bounce has the potential to manifest within such a short time frame. But, the more dramatic the decline, the more dramatic the bounce. Like a rubber band: the more you pull it back, the harder it snaps forward. The green box at the right of the chart shows the closing price from Friday of 8378. The blue vectors show the pattern I predicted from back in the summer, and have been adhered to very tightly throughout the decline. The upward pointing ones show what the bounce should look like once this low comes in during the next few days.
_________________________________________________________
MARKETS: Since there is NO WAY to know for certain in advance, there are various strategies for entry that professionals use to act from a position of strength, rather than from a position of weakness that the public prefers.
Here they are:
1. The aggressive stance is to put half your available funds in at a test of the early October lows and the other half at the old lows of the 7200, 776, and 1100 areas, believing that any further declines below these levels will be minor and brief, especially since the decline of the past year has been so deep and fast.
2. The conservative stance will be to put half your available funds in at the test of the 2002/2003 lows, and the other half either at the test of the lower ranges stated above, or on the way back up through the spike highs this month: 9800 Dow, 1045 S&P, and 1900 Nasdaq.
3. The very conservative stance will be to put half your available funds in on the way back up through the spike highs this month: 9800 Dow, 1045 S&P, and 1900 Nasdaq and exit all stock and mutual fund positions early next year on the wave "B" peak near 11,000-12,000 Dow, 1150-1250 S&P, and 2000-2300 Nasdaq.
These options should be used for individual stock entries as well. Once you pick an option, you should stick with your plan to increase the odds of success. The key to success is "planning your trade, and trading your plan". Both are incredibly important to the outcome; without both, the other is too hard to do.
As the title of this comment suggests, this will be a week or two of volatility not seen in history. Iron-like focus and stomachs, in addition to a clear plan set out in advance of the action, are the keys to emotion-free, position of strength, decisions. Any buys under 7000 Dow, and added to under 6000 Dow if that is presented, will be major money makers in the coming months, PROVIDED THE PROPER EXIT OPPORTUNITIES ARE TAKEN. This buying opportunity is the best one of the past year, but not THE buying opportunity of a lifetime, like the one in a couple years will be. Again, that is why the exit I've described above and for the last several weeks will be so important.
For what it's worth,
Ken
Oct 24, 2008
ALMOST OVER (for the "A" wave down)
There was panic overnight in Asia and our markets have tested 7980 so far. Will the Dow punch under its lows of earlier in the month, or rally 2000-4000 points from here? That is the big question, but here is the risk/reward on both.
Punch lower: As I've been giving for a year now, the 7000 area +/- 800 in the Dow is the target for this initial wave "A" down. Earlier in the month, it touched 7800, or the high end of the target given when the Dow was 14,000 in October 2007. Today's lows retested it and have bounced, but there is nothing keeping it from getting deeper into the range. So let's say it tests 7000 in the next day or two. That is 10% more risk from here, after already falling 40% from the top. 10% is livable, so buying could be done from 8000-6500 Dow.
Move higher: If wave "A" is done, I've been talking about the wave "B" bounce into 11,000-12,000 into early 2009. If that happens, that would be a 35% - 45% move higher. We'd all like to join in on that, expecially since it'll eventually fail and roll over to make lows under those of the current lows. So, grabbing some while we can, and selling into it is a good plan.
Therefore, if we can risk 10% - 15% from here, we could participate in a 35% - 45% rally in the next 6 months. We call that a 3:1 winning proposition.
Good Luck.
For what it's worth,
Ken
Punch lower: As I've been giving for a year now, the 7000 area +/- 800 in the Dow is the target for this initial wave "A" down. Earlier in the month, it touched 7800, or the high end of the target given when the Dow was 14,000 in October 2007. Today's lows retested it and have bounced, but there is nothing keeping it from getting deeper into the range. So let's say it tests 7000 in the next day or two. That is 10% more risk from here, after already falling 40% from the top. 10% is livable, so buying could be done from 8000-6500 Dow.
Move higher: If wave "A" is done, I've been talking about the wave "B" bounce into 11,000-12,000 into early 2009. If that happens, that would be a 35% - 45% move higher. We'd all like to join in on that, expecially since it'll eventually fail and roll over to make lows under those of the current lows. So, grabbing some while we can, and selling into it is a good plan.
Therefore, if we can risk 10% - 15% from here, we could participate in a 35% - 45% rally in the next 6 months. We call that a 3:1 winning proposition.
Good Luck.
For what it's worth,
Ken
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