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The Economy and Stock Market


Brentastic
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I guess I made some wrong assumptions - that any of you actually have been following what I've wrote and that you have looked up the wave theory and the basic premise. The term 'waves' should imply that any given trend moves in a roller coaster fashion, just like waves. Here are 2 images that visually describe the fractal nature of waves. These are 'bull market' views.

 

http://www.fx-track.com/en/edu/technicalanalysis/elliott.png

http://static.seekingalpha.com/uploads/200...kar-Mutyala.png

 

Full cycle (bull then bear)

http://3.bp.blogspot.com/_ot1WH5p4Xr4/S0kc...rM/s400/0.1.PNG

uh, yeah, ok, I get it now. The fact that the market actually went up over the last month means that your "theory" is actually correct... even though a month ago you were telling us that your "theory" was saying that the market would go down. It all makes sense now. :wacko:

 

(And, yes, now I am mocking you. But I am doing it out of love. You are being scammed.)

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uh, yeah, ok, I get it now. The fact that the market actually went up over the last month means that your "theory" is actually correct... even though a month ago you were telling us that your "theory" was saying that the market would go down. It all makes sense now. :wacko:

 

(And, yes, now I am mocking you. But I am doing it out of love. You are being scammed.)

You can believe what you want. Let's wait until the end of the year before passing judgement. I said it was going down this year and that the first leg started but I thought everyone understood the way markets move in any direction (up and down). I still think the DOW will hit 5,000 this year but I never claimed it would go straight down without any pullbacks - that would be an absurd thought and not at all consistent with the history of stock market movement. I don't know how I am being scammed - I am following a theory that I understand, that makes sense to me. It's my choice based on reading and studying this theory, nothing more or less.

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there are some people saying we may see a deflationary period.....even more people saying hyper-inflation...

 

I think we're headed for something bad, but can't see how we would face a deflationary period when there is so much money out there circulating....even recent taxes on food and gas show that inflation is kicking into play as what seems like the most logical scenario considering how the recession has been handled...

 

I don't think it will be as bad as the 30's because those were different times and we have way more resources....but this generation doesn't know how to live without technology....

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You can believe what you want. Let's wait until the end of the year before passing judgement. I said it was going down this year and that the first leg started but I thought everyone understood the way markets move in any direction (up and down). I still think the DOW will hit 5,000 this year but I never claimed it would go straight down without any pullbacks - that would be an absurd thought and not at all consistent with the history of stock market movement. I don't know how I am being scammed - I am following a theory that I understand, that makes sense to me. It's my choice based on reading and studying this theory, nothing more or less.

That usually the way they work...

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there are some people saying we may see a deflationary period.....even more people saying hyper-inflation...

 

I think we're headed for something bad, but can't see how we would face a deflationary period when there is so much money out there circulating....even recent taxes on food and gas show that inflation is kicking into play as what seems like the most logical scenario considering how the recession has been handled...

 

I don't think it will be as bad as the 30's because those were different times and we have way more resources....but this generation doesn't know how to live without technology....

Yeah, but the bulk of that money is credit or 'IOUs'. I think I've seen that the ratio of credit to actual base money is somewhere between 50 and 500. That's a large range, but even the low end is too much. With all those IOUs, we almost have to go through deflation as a cleansing process.

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You can believe what you want. Let's wait until the end of the year before passing judgement. I said it was going down this year and that the first leg started but I thought everyone understood the way markets move in any direction (up and down). I still think the DOW will hit 5,000 this year but I never claimed it would go straight down without any pullbacks - that would be an absurd thought and not at all consistent with the history of stock market movement. I don't know how I am being scammed - I am following a theory that I understand, that makes sense to me. It's my choice based on reading and studying this theory, nothing more or less.

I am FAR from bullish on the economy or markets but if you think the DOW will hit 5000 this year then I think you are going to need that wave theory to be a tsunami theory

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  • 5 weeks later...

Stock market update per Elliott Wave analysis - where the market is in the EW progression:

 

First, look at this video to see an Elliott Wave chart of the DJIA. You don't have to watch the video (I didn't), just pause it and look at the chart. It's a chart of the DJIA starting from the 2008 drop until about 3 weeks ago. Everything left of the bottom is considered wave 1 (of 5) down, with the low or bottom arriving last March, 2009. The entire leg up from that low is considered wave 2 (of 5). Impulse waves consist of 5 waves. Waves 1, 3 and 5 of an impulse move in the direction of the overall trend (in this case down in a bear market). Waves 2 and 4 are corrective waves and move against the trend of a larger degree. And finally, the current counter-trend wave 2 consists of what is called a tripple zigzag, which is labeled WxYxxZ. It's important to understand that Elliott Waves are fractal, meaning each wave consists of smaller versions of itself, and inverseley, make up bigger versions of itself in different time frames. So, the current Z wave will consist of 3 waves (ABC).

 

So, with that in mind, today confirmed we have begun wave b (down) of Z (up) of wave 2 (up). The market should continue down for at least a week or maybe longer to complete this wave b of Z (of 2). The near term downsid range for this wave b is 1094-1143 in the S&P and 10,200-10,604 in the DJIA. As more of the structure of the decline unfolds, these wide ranges should narrow considerably. After the week or so down move that began yesterday, we will have one final leg up to complete wave Z (of 2). Then the dreaded wave 3 down will begin.

 

Bottom line: the market is nearing a major top which I originally thought started on Jan 19 and labeled as wave Y on that chart. As it turns out, that wave Y marked the end of a double zigzag correction. However, there has never been more than a tripple zigzag correction, so this leg up must be the final leg before the dreaded wave 3 down. Remember, all impulse waves consist of 5 waves (again, we are currently in a wave 2 correction) with wave 3 usually being the most severe/impulsive/dramatic of the 3 motive waves.

 

I know this is a little confusing to the casual reader and the chart I provided is generic but hopefully this post brings a little more clarity to my EW ramblings.

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For the hell of it, I just watched the whole video. It is truly the biggest bunch of nonsense on the stock market that I have ever seen. Seriously.

You saying that is like a 6th grader hearing a description of a derivative and denouncing all of calculus. You should have a firm understanding of the rules and guidelines of the EWT before making such a harsh judgement on something you know nothing about. Some of the greatest traders in the world - several who have won the world championship of trading, study and implement the EWT in their approach. Many intelligent people, much smarter than you or I, see much relevance in this theory.

 

If you put some time into studying this and tracking the market with it and then you feel the same - I'd say your thoughts have some basis. But as of now, you're just a jaded economist that can't look past your supply and demand curves. I suspect you've never been a trader (I have) and your only market knowledge is from the angle of an economist - but I'll tell you and I'm sure dmarc will back me on this, there's many different ways to forecast market direction and all of those different ways can yield successful results. I've found EWT to have the best forecasting ability because it allows you to see the current progression of the market within a predictible form. I'd say fundamentals are the least reliable of any method, and I'm guessing fundamentals are the basis for anything you forecast. I've learned that economists are rarely right when it matters and only in hindsight does an economist appear to know what's going on.

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You saying that is like a 6th grader hearing a description of a derivative and denouncing all of calculus. You should have a firm understanding of the rules and guidelines of the EWT before making such a harsh judgement on something you know nothing about. Some of the greatest traders in the world - several who have won the world championship of trading, study and implement the EWT in their approach. Many intelligent people, much smarter than you or I, see much relevance in this theory.

 

If you put some time into studying this and tracking the market with it and then you feel the same - I'd say your thoughts have some basis. But as of now, you're just a jaded economist that can't look past your supply and demand curves. I suspect you've never been a trader (I have) and your only market knowledge is from the angle of an economist - but I'll tell you and I'm sure dmarc will back me on this, there's many different ways to forecast market direction and all of those different ways can yield successful results. I've found EWT to have the best forecasting ability because it allows you to see the current progression of the market within a predictible form. I'd say fundamentals are the least reliable of any method, and I'm guessing fundamentals are the basis for anything you forecast. I've learned that economists are rarely right when it matters and only in hindsight does an economist appear to know what's going on.

I have to ask then...how did you fare with the markets decline and I don't mean now that it has rebounded some I mean at its worst...were you buying Puts or short selling before the market tanked? Just curious :wacko:

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I have to ask then...how did you fare with the markets decline and I don't mean now that it has rebounded some I mean at its worst...were you buying Puts or short selling before the market tanked? Just curious :wacko:

I was not actively trading during that time. I took a 4 year hiatus from the market when I stopped trading the bonds back in 2005 - completely left the market behind. I always knew I would trade again, but promised myself only when I knew the time was right. Last year I began my comeback slowly by watching the market and then I literally stumbled onto the EWT and it instantly became my new love affair - much like the 'love at first sight' feeling I had when I met my wife. It made so much sense doubting it's validity has never creeped into my head. I started making small trades over the summer and I was seeing very good returns but that doesn't really mean anything because anybody who was long stocks in the last year basically made money.

 

Finally, early this year I started to get back into bond trading again. I opened my own account (previously I worked for a firm) and traded using a 15 minute delayed chart and phoning in my orders. Being a former day trader where speed and real-time price activity were essential tools for success, this new method was challenging. However, my new approach, armed with the EWT, was to be more long-term and wait for big reversals rather than getting edge and one-ticking my way to profits. Previously making 6 ticks a day was a good day - on a 20 lot that equates to $3,750 in profits per day. Only rarely as a day trader did I have more than a 4 tick winner on one trade. My new approach using the EWT, my smallest winner has been 15 ticks, my largest winner 2 points (64 ticks). I've seen 1st hand how powerful a tool the EWT can be when exercising patience and discipline and I'm using that same tool in the stock market too. I'm currently short the Russell, DJIA and S&P - which have yet to pay out, but I'm confident they will - I haven't seen anything in the market to suggest I'm wrong yet. Not saying my forecast won't/can't be wrong, but as of now, I'm holding steady and staying patient.

 

So, that's my investment history in a nutshell I suppose.

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So, with that in mind, today confirmed we have begun wave b (down) of Z (up) of wave 2 (up). The market should continue down for at least a week or maybe longer to complete this wave b of Z (of 2).

Just checking in: What have the last two days confirmed?

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Stock market update per Elliott Wave analysis - where the market is in the EW progression:

 

First, look at this video to see an Elliott Wave chart of the DJIA. You don't have to watch the video (I didn't), just pause it and look at the chart. It's a chart of the DJIA starting from the 2008 drop until about 3 weeks ago. Everything left of the bottom is considered wave 1 (of 5) down, with the low or bottom arriving last March, 2009. The entire leg up from that low is considered wave 2 (of 5). Impulse waves consist of 5 waves. Waves 1, 3 and 5 of an impulse move in the direction of the overall trend (in this case down in a bear market). Waves 2 and 4 are corrective waves and move against the trend of a larger degree. And finally, the current counter-trend wave 2 consists of what is called a tripple zigzag, which is labeled WxYxxZ. It's important to understand that Elliott Waves are fractal, meaning each wave consists of smaller versions of itself, and inverseley, make up bigger versions of itself in different time frames. So, the current Z wave will consist of 3 waves (ABC).

 

So, with that in mind, today confirmed we have begun wave b (down) of Z (up) of wave 2 (up). The market should continue down for at least a week or maybe longer to complete this wave b of Z (of 2). The near term downsid range for this wave b is 1094-1143 in the S&P and 10,200-10,604 in the DJIA. As more of the structure of the decline unfolds, these wide ranges should narrow considerably. After the week or so down move that began yesterday, we will have one final leg up to complete wave Z (of 2). Then the dreaded wave 3 down will begin.

 

Bottom line: the market is nearing a major top which I originally thought started on Jan 19 and labeled as wave Y on that chart. As it turns out, that wave Y marked the end of a double zigzag correction. However, there has never been more than a tripple zigzag correction, so this leg up must be the final leg before the dreaded wave 3 down. Remember, all impulse waves consist of 5 waves (again, we are currently in a wave 2 correction) with wave 3 usually being the most severe/impulsive/dramatic of the 3 motive waves.

 

I know this is a little confusing to the casual reader and the chart I provided is generic but hopefully this post brings a little more clarity to my EW ramblings.

 

Here's my advice. Get a big bag of Josh Gordon. Smoke some of it. Read what you wrote and watch the video. While i have not tried this, i think that it will help you will realize how ridiculous it all is.

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EWT is either a good way to make money or lose money, depending on when you start and your discipline.

 

Pretty much no different than any other approach to making / losing money.

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Just checking in: What have the last two days confirmed?

What can I say, the forecast was incorrect in the near term and I was wrong - it doesn't change the big picture forecast though. I have remained consistent in saying all forecasts are only based on probability, not on certainty. Probability was wrong in my near term forecast and I will learn from it.

 

This resilient and stubborn market is only worsening the eventual and inevitible decline that will occur. I know you're going to point out every time the market doesn't behave exactly how I forecast, and I guess in a way, I deserve it for sticking my neck out. But that's fine by me and it's fine to be wrong too - I can admit it and accept it.

 

I am still confident in my forecast and my approach to studying the market. I'm sure when the market does endure a major decline you will find a way to say I am wrong, and that's ok too. It's all good, brother.

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  • 5 weeks later...

Market Update: The peak on April 26 followed by the clearly motive decline last week, most likely confirms that the next wave down has begun. Like I've stated all along this is going to be a bear market of epic proportions and is shaping up to be a roller coaster ride that should bottom in 2016 - that's 6 long years of this crap. The roller coaster for the next 2 years will mimic 07-present. In other words we should have a major decline this year followed by a strong rally in 2011. My best guess for the next year is a low at around 6K DOW with a subsequent rally into early 2012 that reaches about 8K DOW. The following 4 years, 2012-2016 will be of epic proportions. A conservative estimate price range for the DOW bottom is below 1K - that's DOW in the hundreds. This is nothing new from an EW perspective. I've stated the possibility of DOW below 1K several times. And again, that price is a conservative estimate and again won't be seen until 2016 - and the high reached last Monday (Apr, 26) won't be seen again for over a decade. This is real, folks. Glitches don't cause 10% market declines within 20 minutes, bear markets do. Remember, the market was already down 400 points when it happened, and it followed it up Friday with another 1% decline.

 

I've really enjoyed the actual discussions in the other 'money' threads last week. There is no need to get angry in this thread. Every investor has a great opportunity to make a lot of money in the coming 6 years, lose a lot in that same time frame or, the safest route, hold cash in preparation for a deep depression. You have an opportunity to be prepared for the greatest economic failure in our life times. I'm serious. Whether you believe my forecasts or not, last week should at least offer you some evidence that you should question the 'recovery', open your eyes to the global problem and understand how the money system works, including credit and why a depression is on the horizon. Most importantly, understand that stock market pricing is based soley on public perception and it moves motively based on extreme optimism or extreme pessimism. Earnings don't mean didley unless people are buying the stock and in a depression, stocks will fall the hardest, no matter what industry.

 

Guys and gals, this is serious stuff going on in our country, from corruption to negative social mood, there is no escaping what lies ahead. You can only be prepared for the worst and hope for the best. Amidst constant ridicule from most of you either because you don't like what I say or how I say it - I am still sticking my neck on the line because I truly care about all you frackers, even perceived enemies. When have I ever come on here and pounded the same topic this persistently? Never (other than when I predicted the rise of DeAngelo Williams and the demise of Shaun Alexander) and that's because I'm really passionate about this and I know what I'm seeing. I have a certain gift for recognizing various things as complete certainty. This is one of those times and I really hope most of you protect your finances and give my forecasts some more thought.

 

And remember, my recommendation has always been to get cash heavy - I'm not promoting shorting the market even though that's my position since January. I'm advocating maximum safety (no money saved as credit, safe banks, cash in safes at your home etc...) - so worst case scenario if I'm wrong is you don't earn interest on your money. In other words, the worst case scenario of getting cash heavy is you don't lose - that's what I call a great investment strategy in these uncertain times - please consider it, this market is not a joke.

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Market Update: The peak on April 26 followed by the clearly motive decline last week, most likely confirms that the next wave down has begun. Like I've stated all along this is going to be a bear market of epic proportions and is shaping up to be a roller coaster ride that should bottom in 2016 - that's 6 long years of this crap. The roller coaster for the next 2 years will mimic 07-present. In other words we should have a major decline this year followed by a strong rally in 2011. My best guess for the next year is a low at around 6K DOW with a subsequent rally into early 2012 that reaches about 8K DOW. The following 4 years, 2012-2016 will be of epic proportions. A conservative estimate price range for the DOW bottom is below 1K - that's DOW in the hundreds. This is nothing new from an EW perspective. I've stated the possibility of DOW below 1K several times. And again, that price is a conservative estimate and again won't be seen until 2016 - and the high reached last Monday (Apr, 26) won't be seen again for over a decade. This is real, folks. Glitches don't cause 10% market declines within 20 minutes, bear markets do. Remember, the market was already down 400 points when it happened, and it followed it up Friday with another 1% decline.

 

I've really enjoyed the actual discussions in the other 'money' threads last week. There is no need to get angry in this thread. Every investor has a great opportunity to make a lot of money in the coming 6 years, lose a lot in that same time frame or, the safest route, hold cash in preparation for a deep depression. You have an opportunity to be prepared for the greatest economic failure in our life times. I'm serious. Whether you believe my forecasts or not, last week should at least offer you some evidence that you should question the 'recovery', open your eyes to the global problem and understand how the money system works, including credit and why a depression is on the horizon. Most importantly, understand that stock market pricing is based soley on public perception and it moves motively based on extreme optimism or extreme pessimism. Earnings don't mean didley unless people are buying the stock and in a depression, stocks will fall the hardest, no matter what industry.

 

Guys and gals, this is serious stuff going on in our country, from corruption to negative social mood, there is no escaping what lies ahead. You can only be prepared for the worst and hope for the best. Amidst constant ridicule from most of you either because you don't like what I say or how I say it - I am still sticking my neck on the line because I truly care about all you frackers, even perceived enemies. When have I ever come on here and pounded the same topic this persistently? Never (other than when I predicted the rise of DeAngelo Williams and the demise of Shaun Alexander) and that's because I'm really passionate about this and I know what I'm seeing. I have a certain gift for recognizing various things as complete certainty. This is one of those times and I really hope most of you protect your finances and give my forecasts some more thought.

 

And remember, my recommendation has always been to get cash heavy - I'm not promoting shorting the market even though that's my position since January. I'm advocating maximum safety (no money saved as credit, safe banks, cash in safes at your home etc...) - so worst case scenario if I'm wrong is you don't earn interest on your money. In other words, the worst case scenario of getting cash heavy is you don't lose - that's what I call a great investment strategy in these uncertain times - please consider it, this market is not a joke.

Bump - this is a must read update.

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Y'know, Brent, we get it. Thanks and all but we have received the message.

I've never been accused of lacking passion or persistence. I'm only trying to open the eyes of people like you who seem to think you can just ride this out. This bear market is of a different magnitude of anything we've ever witnessed and I feel compelled to help as many people as I can because I'm so confident in this move. If that means annoying persistence, then so be it. You will thank me eventually.

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I've never been accused of lacking passion or persistence. I'm only trying to open the eyes of people like you who seem to think you can just ride this out. This bear market is of a different magnitude of anything we've ever witnessed and I feel compelled to help as many people as I can because I'm so confident in this move. If that means annoying persistence, then so be it. You will thank me eventually.

Ups and downs. Been seeing it my whole life. The sky is not falling and a glitch helped to set up a sell off. Greece is also a concern as is the rest of the EU. Thursday produced the largest in session decline of the Dow in history and we are just reaching double the value of your predicted Dow level that was supposed to have been surpassed by now according to you.

 

I think what Ursa is trying to say is... You seem to know a lot of stuff. You have read a lot of books and even studied this a bit. While that may translate into knowledge that He, I, and many other Huddlers don't have, it hasn't translated into you being very good at predicting the Dow Jones Industrial futures.

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Ups and downs. Been seeing it my whole life. The sky is not falling and a glitch helped to set up a sell off. Greece is also a concern as is the rest of the EU. Thursday produced the largest in session decline of the Dow in history and we are just reaching double the value of your predicted Dow level that was supposed to have been surpassed by now according to you.

 

I think what Ursa is trying to say is... You seem to know a lot of stuff. You have read a lot of books and even studied this a bit. While that may translate into knowledge that He, I, and many other Huddlers don't have, it hasn't translated into you being very good at predicting the Dow Jones Industrial futures.

Well said but I think you're missing the point. This is about warning people of what is ocurring in the stock market and little to do with my market timing. Also, let's be accurate here, I've never once predicted the DOW would hit 5,000 by now. What I have been consistent in saying, is that 2010 will mark the beginning of a several year decline in the stock market that will hit levels not been seen in decades and that the DOW should reach 5,000 within a year. While I have provided shorter term forecasts, I've also remained consistent in saying that short-term predictions are harder to time and are only guestimates regarding timing or 'when'. The fact remains that the market will hit levels un-imagined by most which makes being prepared even more essential for financial survival.

 

If you want to call out my predictions separately, you will have to wait another year or so before saying I'm wrong. So far, my predictions are unfolding exactly as I thought as far as degree and the mass perception of exogenous causes orchestrating such moves. Once again, a 'glitch' did not cause the market drop last week. If it was truly a glitch, the market would have at least closed in the green on Friday, instead it lost another 1%. Instead of automatically disagreeing with me because you don't understand it and fear change, try working with it. Maybe provide your reasons for disagreeing. To argue and not provide any disputing evidence or support of a varrying idea is counter-productive and serves no purpose.

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