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Got the elliottwave bible for christmas - Prechter and Frost's, although some will call Neely's the bible, one step at a time for me - thought I'd try out what I've learned.

 

US corporate bonds look toppy, charts below of the junk bond etf, the investment grade bond etf HYG sports a similar count.

post-1496-1263069477_thumb.jpgpost-1496-1263070917_thumb.jpg

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USD/CHF 5 min erection correction

 

USDCHF110120105mincorrection.jpg

 

1) Zigzag and Symetrical Triangle

2) Double Zigzag

3) Other

 

Answers on a postcard please too...

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OK maybe talking to myself here but anyways...Either he is right or 100% wrong.

 

I can't see precious metals since 2001 as a bear market rally myself. Or if it is then I can see it with a few more years left in it. If most banks close from here to 2015 then I can only see gold going up (ballistic) as the only safe haven asset. Prechter seems to be saying that gold (pm's) will be in a bottom along with stocks. Again this doesn't seem quite right to me when looking at Dow/Gold which would suggest that you could buy the Dow with an ounce of gold or less in a few years.(presently about 9oz).

 

He says Fibonacci numbers imply a turn, 'probably a bottom', in 2014 for gold. To me this is upside down and we are more likely to see a top thus giving us the Dow/Gold ratio as aforementioned.

 

So I see a gold top and stocks bottom for 2014/15. Dow at 1000 or something Prechteresque (400 I think is what he has said before on King interview). Then at that stage we might have real currency inflation printing and off we go into the Kondratieff Spring, the worst of winter behind us, except for unemployment bottoming later.

 

I'm staying with my gold silver cash and maybe property/home if needs be.

 

Anyone else had a look at the latest Theorist? It is worthy of a good read no matter what you think. Value for money and extremely thought provoking stuff.

 

If he is wrong and got gold upside down then I do wonder how he'll talk his way out of it. Of course he could well be right in which case I would say he is nothing short of genius. Brave genius. Maverick genius. Whatever.

 

 

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[quote name='romans holiday' date='Jan 16 2010, 04:42 AM' post='152488'

 

 

 

 

 

Is it possible to post a link?

Afraid it is subscrption only, though I would appreciate your valued opinion on it,for one.

 

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If he is wrong and got gold upside down then I do wonder how he'll talk his way out of it. Of course he could well be right in which case I would say he is nothing short of genius. Brave genius. Maverick genius. Whatever.

Though I generally accept Prechter's bear thesis, I find him in two minds about gold [maybe I'm being generous here]. From my perspective what Prechter misses at times is that because gold is in the process of monetization it should benefit, along with other major currencies, with the drive towards liquidity as debt continues to contract. Of course this doesn't mean that gold will not be volatile to the downside.... or to the upside for that matter [this is why I hold dollars besides gold/ silver].

 

I think at times with Prechter his mega deflationary thesis overshadows all else, but at other times, when he focuses solely on gold, he is quick to point out that it is sound money and you definitely want to own it.

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Anyone read the latest Theorist? :blink::o

Bit of a shocker.

Interesting. For what reason, please?

 

This could be useful..

 

Kevin Depew interviews Robert Prechter

http://sovereignspeculator.com/2010/01/01/...obert-prechter/

This is from a month ago, but it is a wide-ranging discussion from a long-term point of view. Depew is a very sharp guy who saw deflation coming himself, so this is one of the best Prechter interviews I’ve seen.

 

Another forecast:

http://www.businessinsider.com/robert-prec...wn-year-2009-12

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Interesting. For what reason, please?

 

This could be useful..

 

Kevin Depew interviews Robert Prechter

http://sovereignspeculator.com/2010/01/01/...obert-prechter/

This is from a month ago, but it is a wide-ranging discussion from a long-term point of view. Depew is a very sharp guy who saw deflation coming himself, so this is one of the best Prechter interviews I’ve seen.

 

Another forecast:

http://www.businessinsider.com/robert-prec...wn-year-2009-12

Thankyou very much for those DB.

 

The reason I felt the latest Theorist to be a bit of a shocker may not shock the seasoned Prechter fan as it has been 'implied' in CTC and other Theorists but I must say I found the latest eidtion to be rather explicit (eg on what to hold for the next 5 years and what not to hold). Also I am a bit stunned as to a bottom in gold and stocks at the same time. I would have expected different esp from my understanding of K-wave Winter a la Ian Gordon. I do feel Prechter has it wrong on a 'probable' gold bottom in 2014-at least I hope he has it upside down. I was expecting a 'probable' gold top perhaps and a stocks bottom. Maybe that was the shock. I wonder what he envisages the Dow/Gold ratio to be on this bottom? His stonger than usual language struck me and that he feels we are right on a major reversal point right now for stocks and basically for gold too.

 

There is so much to Prechter that speaks above most other commentators (for me at least) . The timing as he talks about in the interview with Dewey is prescient though-in a grand supercycle view of life 5 years off is pretty near the mark. Well, hell ya! I could lose everything and he could claim to be spot on with that kind of timing. So is he wrong on gold by 5 years and we'll see a top in gold in 2014 and not a 'probable' bottom? With nearly the whole world in deep doodoo and the banks/economy on artificial QE life support and also now a general awakening that nothing is safe, I see gold being a recipient of those worries. ie a safe haven and a very limited (small) one at that. And there's the dichotomy in Prechter. He recommends holding physical gold and he recommends cashing out of gold at the same time. Is he covering his basis? He clearly likes gold.

 

So there you go! Maybe you are not so shocked by all this and have, I am sure, a better grasp on his overall deflation thesis than myself. If you have any input/thoughts I'd be glad to hear them.

 

Dewey interview was great. And I enjoyed it. But it did give me thoughts on Prechter's timing. Doubts really. Example in 99, I think he said, you want to be aware of the socionomic trends and preparing yourself for the changes. Well you would have made more cash positioning yourself for a massive property bubble thanks to IR reactions to 9/11, Greenspan and the world economy. So there were a few 'unseens' in there to delay Prechters train. Mere leaves on the track for him in the larger picture of the grand super cycle, but could have been very expensive to anyone who ignored the massive HPI/Kondratieff autumn inflation.

 

I understand why Prechter is a forecaster and not a money manager! Ian Gordon actually has to perform for his clients or else he would get fried. So I think a synthesis of both of them (and others besides) is necessary.

 

Anyone who doesn't subscribe to the Theorist at least, then I'd say you are missing some damn fine coffee. Well, thought provoking.

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Prechter: Stocks down/Dow about 400 eventually, Gold down in the Deflation/possible 280 USD.

I really don't know why people take this guy seriously.

 

Anyone who listens to Prechter should also listen to the Financial Newshour interviews that were summarised in the Christmas/New Year shows. The whole Prechter theory is based on the idea that the monetary world still works as if we were on a gold standard. It's seriously ridiculous.

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I really don't know why people take this guy seriously.

 

Anyone who listens to Prechter should also listen to the Financial Newshour interviews that were summarised in the Christmas/New Year shows. The whole Prechter theory is based on the idea that the monetary world still works as if we were on a gold standard. It's seriously ridiculous.

 

I think it is prudent to see how he comes to his conclusions. 280 was a 'could' rather than forecast. 680 is more his tune.

For anyone with a massive pile of gold I would worry about his method. For him gold is in a bear market rally of its own, now :blink: .

 

Any links for the FS Xmas summaries?

 

BTW I hope you are right and he is way off on gold, but that is only because

I feel more comfortable in a Gordon world than a Prechter world. Still I don't think you can just rubbish him.

 

Can you trash Ian Gordon's Deflationary thesis for me so easily? Or is that somewhere you haven't been to try out your hyperinflation arguments?

 

What is he not seeing that the hyperinflationists are seeing exactly?

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Can you trash Ian Gordon's Deflationary thesis for me so easily? Or is that somewhere you haven't been to try out your hyperinflation arguments?

I am not sure what you're talking about, but anyway, the main problem is that the hyperinflation vs. deflation debate will be decided by politicians. Now, how many examples do we have of politicians who chose the hard, honest way (deflation)?

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I am not sure what you're talking about, but anyway, the main problem is that the hyperinflation vs. deflation debate will be decided by politicians. Now, how many examples do we have of politicians who chose the hard, honest way (deflation)?

 

I was asking you where you feel Ian Gordon is wrong on Deflation. A good read can be had here. Well worth your time.

 

http://www.longwavegroup.com/publications/...222_Dow1000.pdf

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Looks like a bounce in the S&P500 is on the cards tomorrow or early next week..... wave 2 of a larger degree perhaps?

 

SDS2911030min.jpg

 

(SDS used for anyone following Larry P's trade of the year)

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A look at cable, possible EW count in confluence with a high probability crab pattern.

 

Cable.jpg

 

If this is a third wave then counter trend bounces should be very shallow.

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Ian Gordon: Ignore the Illusion of Spring

 

http://news.goldseek.com/GoldSeek/1266874951.php

IG: I am very much a deflationist. Taking the debt out of the system is in itself a deflation process. You can see it in falling housing prices. As debt comes out of the housing and mortgage markets, it deflates prices. We're going to see the same in stock prices. Wealth is being reduced considerably, and that is deflationary.

 

A lot of people who argue for inflation say that all the money being printed eventually has to go through the banks back into the economy. But it's like being on a treadmill. You running as fast as the treadmill goes, but you don't get anywhere. The Federal Reserve is printing copious amounts of money trying to re-start the economy. Unfortunately, the rate of debt being taken out of the system eventually will overwhelm their ability to do that.

 

TGR: Your Winter Warnings indicates that as we move through this collapse, China will become a scapegoat in terms of other governments implementing policies that will harm Chinese exports. If the Chinese GDP is growing and they're already becoming less reliant on exports, could they have a milder Winter than Europe and the U.S.?

 

IG: I think perhaps the Chinese Winter will be the worst of all, and again we have a parallel. China is the U.S. of the '20s. The U.S. came out of World War I as the world's largest creditor nation, with a major significant growth in its industrial prowess—all of which China is today. At that time, the U.S. government was paying down debt, and it wasn't that significant anyway. And now, the Chinese government doesn't have much debt; either. But in the U.S., corporations and consumers of the "Roaring '20s" built up huge amounts of debt. You see parallels in the housing market in the '20s to what we see today in China. A lot of suburbs were developed because people had automobile or railway access to the suburbs. At the same time, we had a major development of skyscrapers in city centers, monstrous buildings carrying monstrous debt.

 

China is in that kind of process. What happens when you get so wealthy, you're exporting so much, particularly to the United States, the Chinese government takes the U.S. dollars and credits the bank with renminbi. The bank has all this money on hand. So a local businessman goes to the bank and says, "I want to build a factory and build toys for Toys 'R' Us in the United States." The banker says, "Fine." He has all this money; he makes the loan; the borrower goes and builds his factory. Somewhere across town, someone else goes to another bank and does the same, and again and again with different borrowers and lenders. It's the mal-investment that occurs when you have so much money floating in the system.

 

TGR: And then what?

 

IG: Eventually, the United States, the biggest importer of Chinese products, cannot continue buying at that level. Despite the pace of growth in China's economy, it still takes probably at least 50 years, maybe more, to develop a middle class. Those are the people who have the wherewithal to spend. So, it's going to take China a long, long time; it's still very much an agrarian economy.

 

For these reasons, I think China's banking system will go the way the U.S. banking system did in the '30s, and the whole economy will go into a collapse. But out of it, she will rise as did the U.S. as the greatest economic, financial and political power. She will be the world leader.

...

TGR: So, it's a combination of owning gold and gold stocks. Or should we say precious metals—we'll expand it out to silver. Should our portfolios consider other elements?

 

IG: As for silver, it didn't really work as a monetary instrument in the early 1930s. Although at that time U.S. coinage from the dollar to the dime was minted in silver, so there was certainly hoarding of silver coinage during the last depression. During this depression silver may well take on a monetary role, since the price of gold might take that metal out of reach of many people. I think only the precious metals work—again because of the stock market debacle that I see occurring. We know that investing in precious metals worked in the '30s. People were pushing their money into gold stocks because they wanted to be in gold in any shape or form.

 

TGR: Because you're suggesting that all gold companies will increase in value during this timeframe, should the average investor be concerned about which specific gold companies to invest in?

 

IG: Certainly the producing companies will go up with the rising price of gold. Don't forget in the early '30s the gold price was fixed at $20.67 and it wasn't raised to $35 until 1934. But even so, people were investing in the gold companies, both explorers and big producers.

 

Today, I tend to put my money into the juniors because that's where I see the leverage to a rising gold price. But you've got to be very, very selective and very cautious. You have to evaluate management of these companies. In Canada, particularly in Vancouver where most of the junior precious metals companies are situated, we're living with these people. It's very tough in the United States, where you have to rely much more on what others tell you. Fortunately, a lot of very reputable newsletter writers and so on are trying to do a good job in their recommendations.

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Great article as ever from IG. Funnily enough I was staring at the 'wheel within a wheel' chart thinking that just about all the conditions for 'spring' in the Kondratieff cycle are looking to be met. 'Have we blinked through winter', I wondered, 'is this a 'false' spring in some way. Come home and here is this article, so thanks for posting.

 

'TGR: Will this Winter end in 2012 then?

 

IG: No, it's just the bear market bottom. Remember the bear market bottomed in 1932. But the Great Depression didn't really end until World War II. The Winter continued even though the bear market had bottomed.'

 

 

So some fun in store for us lot. Chuck in possibility of Kunstlerian peak oil and the years 2012 to 2025/30 sound like a load of laughs. Never mind I am going to have some scottish single malt now and quit thinking till tomorow. Its been a long day.

 

 

BTW here is the 'wheel'.

 

http://www.longwavegroup.com/market/charts..._Wave_Cycle.pdf

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My preferred count on the S&P500:

 

ESM023510.jpg

 

If it's correct we could see sideways action posssibly in a range of 1088-1051 carving out a triangle over the next few days, a close above 1117.50 would invalidate this count but the bear count would still be in place unless a close above 1178.75. Next resistance level is 1099.25 which conicides with the 50% fib RT of wave iii. Target for the end of wave v would be around 1028-1038 based on it being equal in size to wave i and a maximum RT of wave iii to the 50% RT level.

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Wave iii correction may be over -

 

 

ES24510.jpg

 

Anyone know why I've been receiving an "authorisation mismatch" error message when I try to post?

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I've counted this an impulsive move because of the acceleration of wave iii. Target for a turn is 1092 although it's possible that wave v is done here. If so a more complex corrective structure should play out.

 

If 1092 is breached we will most likely have zigzag with turn targets of 1099 and 1117, in which case it is possible that the down trend could resume at these points.

 

Es26510.jpg

 

Es1hrbest26510.jpg

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Diped a toe in on the short side, wave (2) may have completed.

 

es27510.jpg

 

A zig zag or less likely a triangel is a possibility, in the case of a zig zag turning point around 1102.

 

 

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Zigzag based on C being 61.8% of A (1:1= 1108)maybe complete, negative divergence on the RSI possible resumption of downtrend.

es27510-1.jpg

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Zigzag played out to the 1:1 ratio to within 1.5 points - wave c with and extended fifth - AB=CD pattern. Negative divergence on the RSI in place. Let's see if it's straight down from here or a more complex correction. The personality of wave 2 favours the correction is over. Whatever, the chances are, is that the high is in place if it is only a correction. Hence I'm short 2/3 of a full postion, keeping some powder dry for the unexpected.

 

ES28510.jpg

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The correction has turned out to be more complex. I think we are now in a five wave impulsive move to complete wave c of a flat correction back to resistance at the 50% fib retracement of the preceding 5 wave impulse down i.e. 1106 on the E minis. It's very possible that the terminus of c could hit the 61.8 retracement at 1122 if shorts are forced to cover on a move above 1106.

 

To add to the bearish case the trend has been strongest on the downside moves since the peak in the index. By the end of Tuesday 15th June the correction would have taken 1.618 of the preceding move down time wise. Although time in EWP are not as significant as price movement ratios it may well give an indication as to when a turn may occur. A break of 1174 would invalidate my count.

 

ESM0130610.jpg

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Free Week !

/ Click here:

http://www.elliottwavegms.com/free-resources-FreeWeek

 

Elliott Wave Forecast - US Markets 14th June 2010

http://www.youtube.com/watch?v=cIOcVEs8ZIw

 

Robert Prechter & the Severe Bear Market - RickSantelli.tv

http://www.youtube.com/watch?v=cIOcVEs8ZIw

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