Monday, October 2, 2017

The great game in the face of Fed deflation hell

The Fed is pulling their chips.  How long will everyone remain at the table?

An American Tragedy

It's all crystal-clear now.  Never say die.

S&P 500 returns to long-term support at 525

189 comments:

Christian Gustafson said...

That's a reference to Dreiser, for you noobs.

Kevin Wilde said...

This noob's target are SP 2144 (1,) 2359 (2,) 1533 (ker-rash 3,) 1794 (4,) 1255 (5 of A,) 1882 (B.) then somewhere between 250 and 500 for the buy of a lifetime. Tis a trader's dream, and a buy and holder's nightmare.

Hugh Jazole said...

Trannies looking mighty bearish this morning.

Hugh Jazole said...

Any significance to Nasdaq losing 6000?

Kevin Wilde said...

Hugh, the 200 day moving average for the NASDAQ is a tad above 6000. Crashes occur in 4 days, or 4 weeks, of breaking the 200 day. So I've say a close below 6000 for the NAZ would certainly get my attention (though I'd be short long before then as the trend turns negative.)

T.Berry said...

wont' be long till we 23k now. less than 1.5% could happen this week. 25k is looking good over the next 18 months then on to 40k within 8-10 years

42 new all time record highs so far and we still have 1 quarter left.

Bicycle said...

I'll agree to 25k. That's on the table now. DJIA has now broken inflation-adjusted trend going all the way back to 1929.

T.Berry said...

you'll have to hold through a lot of final highs , tops & crashes along the way but it's heading there and much much higher. we'll never see a market as strong as this one and there are no signs of a slowdown any time soon.

we are and have been in a historic market.

T.Berry said...

and the s&P will be over 3k when dow hits 25k

Kevin Wilde said...

Not seeing any sign of the acceleration that would suggest we the oomph to break above an ending diagonal triangle. That suggests markets are about to stall and reverse, as my NAZ 6729 remains illusive.
http://thepatternsite.com/EWDiagTriangle.html

T.Berry said...

kevin,
q3 earnings are about to be released. i'm not going to say the market is going to rally but over the past 3-4 years, the market has a nice bump during quarterly earnings about 90% of the time.

i look for q3 to come in better than expected and believe this market is going higher. we'll smash through 23k without much problem imo. did you see how easy we busted through s&p 2508? it ends up being like the umpteenth top before it. lol.

this is a once in a lifetime market and at best we might be in the top of the 5th inning. wishing you the best calling tops hope you'll do well.

dow 40k is coming

T.Berry said...

just how strong is this bull?---

-september being the worst month of the year for stocks and the dow jones was up 2% making it one of the best months of the year. that's what kind of power this secular bull market is carrying.

Kevin Wilde said...

The question remains: will we see a reversal that puts the cherry on top of this bull before we see the rally acceleration day that puts my NAZ 6729 target into play? We know see the answer to that this week.

Hugh Jazole said...

VERY strong close on both XLF and DJT.

T.Berry said...

what some fail to realize is the fed has been way ahead of the curve for the last 8 years. and that shouldn't change anytime soon as long as yellen is at the helm. the fed has helped us see record levels of wealth in our country. 401k's have never been valued higher and housing the same.

yellen will continue to do the right thing in my opinion as long as the donald stays out of the way.

there has never been a better time to be in the stock market.

Hugh Jazole said...

"as long as yellen is at the helm" That might change.

T.Berry said...

i wouldn't bet on it hugh. : ) trump is a disaster but i don't think he's that stupid. why tinker with something that isn't broken???? yellen has earned her stripes. now in four more years that's a different story trying to replace her will be a pretty big task. the dji will probably be somewhere in the 35k neighborhood (just using a conservative 11.5% annual return from where we are today)

Kevin Wilde said...

You do realize the FED has changed their stance, admitting QE doesn't work, and are terrified of facing a recession at zero bound and a balance sheet in the stratosphere. Interest rates are rising, and their balance sheet starting to shrink. Contrast that to what happened since the 09 low, when their sheet exploded north. Funny that the bulls are so quick to see FED stimulus as driving stocks higher, yet don't see the danger of reversing of such stimulus. I doubt the FED will survive the next recession. Note that FED action failed in 00 to 03, and 07 to 09, and only when the bear was over did FED activity work. Martin Armstrong has a piece this morning on central bank default risk

https://www.armstrongeconomics.com/world-news/central-banks/central-banks-at-risk-of-default/

Bryan Franco said...

But Kevin, maybe we reached escape velocity? Fed policy isn't symmetric under different state variables. Devil's advocate.

Bicycle said...

Trump's PR debt default comments are interesting in the implied disdain for GS and WS. Bit surprised equities aren't pricing in more of an out-of-left field anti-WS choice for Fed chair due to that, assume this is just more evidence no one takes him seriously anymore.

This is the danger to the markets with Trump, if he is backed too far into the corner, he will just put everything on the table, like in the 2nd debate with Hillary. A frustrated man, wandering from the script, Howard Beale style.

Hugh Jazole said...

Nasdaq slipping fast.

Kevin Wilde said...

Bryan, escape velocity with sub 2% GDP growth and sub 2% inflation despite Obama doubling the debt by adding $10 trillion and the FED adding $4.5trillion. Added together that is 10% GDP growth EVERY YEAR SINCE 2009. Hello, they added 10% GDP growth and we came in under 2%, which means the underlying economy is losing 8% GDP per year. How can the economy shrinkage not hit the news when the FED pull back, as they are, and government growth no longer hide the fact now the republicans are in power? While QE obviously can effect asset prices, it cannot effect the economy, and kills savers, workers, and the middle class, with the latters the real economy. What QE should be viewed as a bailout of the mega banks and the super rich. What Dodd-Frank should be viewed as is allowing the mega banks to steal the business of the small and medium banks - the part of the banking system they did not control prior - as well as allowing the mega banks to steal money from all of their customers in the form of fees and super high rates on credit cards. Prior to 2007 credit card interest was about 2% above FED Funds, and now its 14% to 19% above Fed Funds. And one wonders why the mega rich are getting all the love, while the middle class get slammed, all thanks the FED and Obama White House. Back in 06 and 07 I warned all who would listen that the next recession would see the housing and banking system collapse, and see overstretched companies like GM go BK. All that happened, and then some, and all it took was one little ole recession. Now, with government and central banks credit cards maxed out, and the middle class on ropes, the next recession will see the entire pack of cards collapse, with economic reality driving folks into the streets with pitchforks hunting down those responsible. The question is will it be the next recession that drives people in the streets, or a return of the draft, as the US axil of evil plan moves onto NK and Iran, now that the swamp has been able to remove most of the drain the swamp crowd from the White House. The power behind the swamp control the banks, the FED, the military, the media, with the aim of controlling the people with debt, economic misery, and population growth via war. The free markets and revolution will save us, and we should see all that after the next recession. I remain on top watch, waiting for an acceleration breakout for the NAZ that puts my 6729 target on deck next, versus a reversal day that starts the great slide right here. We should know the answer to that this week, and strongly advise everyone gets their financial house in order for the disaster that is headed our way.

T.Berry said...

there is nothing holding this market back. new all time highs are met with newer all time highs.

2nd worst month of the year for stocks and the markets are up over 1.5% in just 3 trading days.

still expect we will at some point get the standard 5-10% bull market correction but will never chance timing it by selling anything.

kevin, my losses from tvix & tza have been made up. no need to hedge in a secular bull market especially one this strong.

Hugh Jazole said...

"While QE obviously can effect asset prices, it cannot effect the economy, and kills savers, workers, and the middle class, with the latters the real economy" Perhaps that's been plan all along? A strong middle class is a direct threat to TPTB. They want lower/ middle class white males to have only one good option, and that's to join the military. Seems to be working brilliantly.

T.Berry said...

kills savers? just about everyone i know with a 401k or stock portfolio are at record levels. i'd say most people are doing pretty well especially with home prices back to record highs. a good indicator is restaurants are back to 1:30-2:00 waits on friday and saturday nights. hiring signs are everywhere too. i don't think the economy has been this strong in a very long time 20+ years.

T.Berry said...

the fed has helped create record amounts of wealth in this country

Hugh Jazole said...

Long OSI Systems?

Hugh Jazole said...

T.Berry, those of us who frequent financial blogs are the fortunate ones. A great deal of people can't afford to sock away 10+% of their income away in 401K's. It's easy to forget this when we have it good. 2017 has been an amazing year for me, and all I did was move some money around in 401K/IRA and brokerage accounts. That is simply not the reality for a lot of people, as their entire income goes to pay for basic needs. Skyrocketing rent/housing has made this even worse.

Kevin Wilde said...

Savers are poorer and middle people who need the additional income from their savings to maintain their lifestyle, such as retirees, and those living on SS. Savers are pension funds, which provides incomes to current and future retirees. Pension funds regularly tilt their invests towards bonds, as safety is critical for such pension funds. 401Ks are a recently new approach that are owned by only a small amount of people in regards to all other monies. 401ks are mostly tilted toward stocks, following a buy and hold approach, thus are held hostage to the whims of the boom/bust cycle. Stocks doing well - for now - is simply a side effect of the FED and government policy helping the super rich who control them. These super rich love the bubble building and bubble bursting model, as they get to sucker people's money in, so they cans steal it when the bubble bursts. Think the Joseph Kennedy's and JP Morgans of the world raking it in and gobbling up the destroyed assets of the masses in the 1930s bubble collapse. It was no surprise the housing bubble collapse, and the surviving big guys who gave us the bubble build - BofA, Citi, JPMorgan, Goldman etc - were the ones to thrive when the bust happened. 401K holders might be doing OK today, but what will happen to them tomorrow when TPTB tell the FED it is time to collapse the bubble? What will happen to pensioners - current and future - in places like Illinois, and California, whose pension funds are vastly underfunded due to interest rates being so low? What will happen to retired saver money now that has been pushed into stocks to earn a yield? Their money will be stolen, and their pensions will be gutted, that's what. Like in the UK in 07, when a big bank took over a savings and loan company, the Halifax, where for generations people put their savings in return for good interest. This merger forced all people with savings their to accept stock in return for their savings. The next year they lost everything as the stock went BK. What did the government and central bank do? They bailed out the bank, though not the people. What did the government and central do in the US when the housing market collapsed? They gave money to big bank hedged funds so they could buy up properties on the cheap, so they could charge high rents. So they not only stole houses from the people, then forced the same people to pay high rent. I could say this is all a game, though it's more insidious than that, because it's all planned. What you see as a helpful FED, I see as a device of the big money devil to keep us in our place as they help the mega rich. You should take a photo of your 401K balance, because they are coming for it, and at least then you can have some piece of paper to look at to prove it once existed. The collapse is coming very soon, and it's got your name on it, all thanks to the FED you love so much. I prefer to play the game of the JPMorgans of the world mano A mano. They make the rules, and since you can't beat them, one is best joining them, or better yet, front running them.

Hugh Jazole said...

"401ks are mostly tilted toward stocks, following a buy and hold approach, thus are held hostage to the whims of the boom/bust cycle." Not MY 401K! I trade with mine, back and forth between stocks and cash. Been doing it for years. Avoided the 2008/09 bust by having 90+% in a stable fund. I got bearish a little early, 2006 or so. I felt vindicated after the crash though.

Hugh Jazole said...

Kevin, all of the things you mention here could be avoided, if the average person understood even the most basic economic conditions. If you're properly allocated, you can avoid the problems of inflation/deflation. The "goldilocks" middle between the two is where stocks thrive. My all time favorite Libertarian Harry Browne taught me this years ago.

https://en.wikipedia.org/wiki/Fail-Safe_Investing

Kevin Wilde said...

Hugh, sophisticated investors, or followers of sophisticated investors, can easily avoid all this, or even profit along with the big boy elites, though those are so few. I made 70% profit in 2008 following the trend, though on reflection I should have done considerably. Since then. my work has been profiting to the max throughout all phases of the bull/bear cycle. I'm up near 50% this year, and poised to make out like a bandit if trends and volatility increase, as I expect. I pity the regular Joe and Jane, who won't be ready to act till its too late. And this time around, the markets will NOT bounce back to bail them out. Thanks for the fail safe investing link.

Kevin Wilde said...

Today looks like the cherry on top reversal day...

Bryan Franco said...

Kevin. Rut needs to slam back into those intermediate and long term internal trend lines. Already 3 to 4% lower

Hugh Jazole said...

I don't follow the Permanent Portfolio exactly. I just make sure sure I'm prepared for inflation/deflation by always having plenty of cash, and a small portion allocated to inflation hedges. I pretty much avoid bonds like the plague, with the exception of trading TIP in the past. Imho we are nearly always swinging back and forth between inflation/deflation. The trick is learn when the sweet spot between the two is likely. The Moore Inflation Predictor has helped me a lot, and I credit it with my performance this year. When the inflation rate is between 1 and 2%, stocks seem to outperform every other asset class. 1.50% is perfect, if the inflation rate stayed there permanently, stocks would never fall.

T.Berry said...


Blogger Kevin Wilde said...
And this time around, the markets will NOT bounce back to bail them out. Thanks for the fail safe investing link.

October 4, 2017 at 10:47 AM

kevin,
why not? it has every single time 100% NO FAIL come back. i remember all the experts in 09' saying the stock market wouldn't come back. given the worst financial crisis in our lifetime, it not only came back but nearly tripled in just 8 years. in 10 years i'm pretty sure the stock market will be considerably higher than where it is today. us markets always come back. we aren't japan. our central banks have proven that they know how to execute and handle a crisis.

congrats on your 50% return this year.

Hugh Jazole said...

" it not only came back but nearly tripled in just 8 years" I think it's a lot more useful to compare previous highs to current ones. In 2007 the DOW topped out around 14,000, and it's around 22,600 now.

T.Berry said...

yeah good point hugh. but if you price average in you made a huge return buying at or near the bottom all the way back to 14,000 and you're closing in on a double from there. that long term buy/hold while price averaging is 100% fail safe. the easiest least complicated way for average investors to make good solid year after year returns.


well, for the toppers, there's always tomorrow : )

Kevin Wilde said...

T.Berry, the reason it will NOT bounce back is because we have a completed generational wave, which I call America's wave. The first wave was the run up into the 1929 peak - the promise of good things to come. The third wave - the real economic one - was the run up in the 1960s peak. The final fifth wave is about to complete - run on debt as internals slowly go the other way. All bears during that time - even the secular ones - were corrective waves of ONLY the prior wave. The next bear is slated to correct the entire century long rally. If corrections take only a 1/3rd of the run up, we are looking 3 decades of bear misery, though I expect would have some major bounces in between (just ones that lead to lower lows.) During that multi-decade generational correction governments and government debt will be restructured, and the battle between socialism versus Liberian versus capitalism versus fascism have be solved, as will Sunni versus Shia thing versus Israel's right to exist. That means world wide revolution and loss of control of governments (at least for a while.) Even if all we faced was simply a cyclical bear that WAS destined to see new highs a few years after the bear, buy and hold is still a stupid way to invest. What comes next is horrific, but necessary.

Kevin Wilde said...

And, yes, today does look like the cherry on top reversal day I was looking for, following the mantra of the world will not end with a bang, but with a whimper.

Hugh Jazole said...

Comments on every blog bullish as hell. Time for a break!

rotrot said...

interesting tidbit from Mark Newton
"...one should study this time in 2007, 1997, 1987, 1957, or even 180 yrs prior in 1837, & also 1931, 1974"
https://twitter.com/MarkNewtonCMT/status/915692174171402241

T.Berry said...

thanks for the explaination Kevin. i can't imagine a century long correction. its never happened before (at least not that i'm aware of). i'm pretty sure our government nor fed would sit back and allow that to happen as it would devastate our country beyond belief.

not to question your analysis or projections, but is this the first time you have predicted a a market top since the financial crisis of 2008/2009? reason i ask is that we have heard many times over the past 5=6 years (way too many to count) the market was topping at levels considerably lower than where we are at now. The first such call was that s&p 1400 then 1440 then 1493 and so on up to where we are now. it seems as though a new top or final top is predicted every other week and has been for the last 5-6 years. why is your nasdaq number 67XX thee latest top of all tops?

thanks for your input, always enjoy reading your replies and wish you well!

Kevin Wilde said...

T.Berry, It is not about forecasting. It is being positioned correctly for when the big moves land. That means cash or short for bear market collapses, and in stocks for the bull market rallies. I was early in my warnings going into the 2000 top, and again into 2007, though nailed them both from a trading perspective. My Bull/Bear cycle indicator has tracked and correctly forecast every bull and bear market over the past century. Trend following, with exposure adjusted for risk, tis the best way to trade these beasts. The FED and government could not stop the 2000-02 bear, nor the 2007-09 bear, and they will be unable to stop the next one. Indeed, they are the prime target this time around, as they are as bankrupt as any overleveraged stupid hedge fund manager. The only opinion that matters is that of the stock market, and one has not been paying attention is one believes the only opinion the stock market ever has is up up and away! Every up, up, and away! phase throughout history has been followed by a near complete retrace of the move. Unless, of course, you believe "it's different this time?" (which are the four most dangerous words in investing.)

Kevin Wilde said...

BTW you have to no further than Japan to see how a generational looks and acts. Japan peaked in 1989 at 40,000. It fell near 90%, before sort of stabilizing, with rally peaks stopping at 20K, and sell-offs near the 10K level. That's 30 years of bear misery, AND THAT WAS WITH THE US AND EUROPE STILL IN BULL MODE. The US, nor Europe, won't have the luxury of anyone in bull mode when we suffer the fake of Japan. And the reason we are suffering it later than Japan did is we had better demographic profile. And now we don't. Now have the too many old people syndrome that collapsed Japan. The Japanese government and central bank failed to stop their generational bear, despite help from a reasonably healthy US and Europe. There is zero hope our fate - and soon to be Japan's again, as there bear has still a few decades to go - won't be far worse than the Japanese experience. Try exposing the virtues of buy and hold to Japanese investors....

Hugh Jazole said...

DJT shifted into reverse fast off 10,000.

Hugh Jazole said...

I just don't see the similarity between the US and Japan. The US is still the worlds greatest military power for one thing. I commend Japan for having a low birth rate, and trying to maintain their ethnic majority. That's the reason they have one of the lowest crime countries in the world. I believe that 98+ of the population in Japan is Japanese. Unfortunately in this crazy global economy, that's not exactly a recipe for economic success.

Kevin Wilde said...

Japan and the US are the same due to demographic mix, as is Europe, Russia, and China. The only difference is peak boomer spending age landed in 1989 for Japan, and 2008 in US/EU/Russia/China. Once a country hits peak spending, it is all down from there, as aging people spend and borrow less than young people growing into middle age, and there's nothing anyone can do about it (unless you find a cure for aging.) Since birth to old age takes many decades all the way up to 100 years, generational bull should follow young through middle age, then reverse post peak into generational bear misery in a near complete reversal. That is what has happened to Japan, and that is what is happening in the US and around the world.

Hugh Jazole said...

That sounds like Harry Dent's predictions. Never listen to a guy named Harry Dent.

Bicycle said...

There is literally nothing now to stop this save an unpredictable massive exogenous shock. Not until DJIA 25k+. The supercycle bear case is dead and buried until then except for whatever BTFD pullbacks we get.

Nothing else is working for the supercycle bearish view. Not technical analysis, not fundamentals, not rate increases, not jawboning, not celestial cycles, smoke signals or rain dances. It's just time to admit it.

Hugh Jazole said...

"The supercycle bear case is dead and buried until then except for whatever BTFD pullbacks we get." Even the UBER BEARS are bullish!!! Time to hibernate.

Kevin Wilde said...

Martin Armstrong update: looking for a peak and reversal today, with resistance at 22,801 and 22,903. Market has NOT begun the phase transition phase, thus 23K is unlikely to be breached, with the latter needed to bring the longer term blow off target at 40K. Gold is not ready for prime-time yet, either.

Bicycle said...

I'm not an uber or perma bear. I was calling for us to hit S&P 2200 way back when it was at 1500. I merely think a supercycle bear market remains a possibility and am interested in its timing.

There's one thing for certain though... the longer this goes on and the higher we climb, the worse the final reckoning is going to be. And maybe this is the final reckoning--beginning phases of a true hyperinflation in the United States.

Bryan Franco said...

Bicycle. The hyperinflation wipes the debt away. Stock markets also have gone parabolic in that scenario too.

Bicycle said...

What is Martin Armstrong's rationale for DJIA 22801 and 22903? On an inflation-adjusted basis there is absolutely nothing out there to stop the Dow until 25k+

There was much stronger historical resistance in the mid-22000's and we blew right through it like it didn't even exist.

Hugh Jazole said...

If hyperinflation is around the corner, we're currently not getting ANY signals. Here's a crazy idea, for the time being we're in a GOLDILOCKS environment. No inflation, no deflation, but juuust right. People ARE starting to get very emotional though, they think the train is about to leave the station without them, and never come back. Slowly but surely looking like a correction on deck.

Kevin Wilde said...

Bicycle, not sure what Martin uses, though his big picture work has been spot since I began tracking him daily in 2011. To him, short term moves like he's forecasting here gateways to bigger moves, but only if bigger support/resistance lines get taken out. Something like this: short term top here confirmed if we break 22,650, and if slide takes off 21,250 on a weekly basis then larger correction underway. Such a larger correction could be a painful sling-shot dive to get everyone bearish to provide the fuel for eventual breakout of 23K to target the ultimate peak at Dow 40K in 2018. (That would be like repeating 1998 dive that morphed into a double the following year for the NAZ.)

Tom McClellan making a case of top here too
http://www.mcoscillator.com/learning_center/weekly_chart/another_narrow_range_for_mcclellan_oscillator/

Anyone who had listened to Harry Dent would know how to make a fortune of the run up of the housing bubble, as well as being able to step aside ahead of the collapse, thus instead of being a dumb victim one could have been following Goldman Sachs to moneysville. If you want to know what's driving market trends to see what comes next then read Harry D. If you are a blind follower of buy and hold, Harry has some real estate he wants you to buy...

Bicycle said...

Look, there is a Bradley middle-terms turn date on Saturday, Oct. 7. I still have the thought that this is a real blow-off and the weekly close can mark a top. But where is the chart? We need to find the rationale for it being a top. Right now what is the reason we should fall? What is the resistance level and why does it exist? What is the confidence level? Why should the ramping stop?

Bicycle said...

I read Martin Armstrong since he was submitting pencil-drawn charts from prison to his buddy back in 2008. It becomes exhausting. His model forecasts turn dates and if they don't pan out on a market basis he starts 20/20 hindsight assigning them to political or economic turns. It's useful to be aware of his turn dates (some of them have been dead accurate) but I don't think its valuable to hang your hat on every one of his calls.

Bicycle said...

If it isn't clear I'm begging for someone to show me a path back to being bearish. Hardcore charts and analysis. Show me the way.

Hugh Jazole said...

"If it isn't clear I'm begging for someone to show me a path back to being bearish. Hardcore charts and analysis. Show me the way." The first step back would be to stop looking for a 2008 like crash, it's not happening anytime soon. There's a big difference between being a bear, and a crash caller. The next best chance for a bear market will 2018/19.

Hugh Jazole said...

CAPE ratio over 31. Sheeeit!

Hugh Jazole said...

The RUT is most interesting index now. Not leading anymore, and hasn't for about a week now.

T.Berry said...

we are nowhere near like japan. japans market crashed in 1989 and hasn't come back.

our market crashed in march 2009, and fully recovered in less than 4 years (feb 2013). our fed proved their monetary policies put in place after the crash worked. they have been ahead of the curve ever since.

for those calling crashes, i highly doubt we'll see another in our lifetime. between circuit breakers, the fed and the donald a crash (something in the range of 50%) isn't going to happen.

there is nothing holding this market back nor is there any reason for it to go down other than a standard bull market 5-10% correction.. plenty of air above and with earnings set to start rolling in better get used to seeing new all time record headlines for a while. this is an epic historic secular bull.

my year end target s&P (2550) got hit today and that was revised from 2500 in late spring.

we're set to take on 3000 within 18 months (think dow 25,000). it doesn't matter how many tops, final highs, full moons, turn-dates, hindenbergs, spinning tops, triple lindy's we have, it's going there. lol

kevin, you mentioned someone calling for a run to dow jones 40000 if it busts through 23000. now that 23000 is clearly in the crosshairs (basically a rounding error away) and should be hit in a matter of weeks or maybe even days,at what point does the 40000 officially get on the table?

remember, free beer tomorrow lol

T.Berry said...

bicycle, if charts worked, every ta'er would be multi-millionaires and would have caught the dow's epic run to 23,000 from 6,600.

Kevin Wilde said...

T.Berry, 2017 US is EXACTLY like 1989 Japan. They were just ahead of us. What happened to them is about to happen to us. Martin Armstrong has two targets from the Dow crash will occur: 23K and 40K. 23K is expected to be a tough nut to crack, and may lead to a big sell-off as a prelude to eventual breakout of 23K. If - IF - we are able to smash though 23K only then we will 40K be on the table. Remember is the collapse of European banking system - including the ECB - and collapse of the political structure that he believes will drive money into the US as the last refuge of money. I find it a stretch to see the US near double while Europe collapses. More like, we collapse together. You latch onto 40K as if its a sure thing, and even if it is, Martin sees the US then following everyone else down the crap hole to reset the entire financial system. Good luck buy and holding through that. Yes, I did catch the run up from Dow 6,600. As did Martin Armstrong and a few others. So, yes, TA does work, if you're following the trend while adjusting exposure in-line with risk. Martin says Dow not ready for prime time yet, so don't expect 23K to be taken out anytime soon.

Hugh Jazole said...

"Dow crash will occur: 23K and 40K" What's the time frame on this 40K call? I can't see that happening for at least another decade.

Kevin Wilde said...

Hugh, I believe Martin looking for either a major bottom next year from where we blow off (which he calls phase transition) into 2020, OR we see a major top and sell-off into 2020 and phase transition after that. He had this year has the year from political hell, and next the return of the European financial crises, and an explosion in civil unrest.

I sort of suspect that his talk of painful swoon as a prelude to the phase transition is correct, which would be a repeat of the 1998 financial and currency crises.

All high risk (pre crash) phases are essentially the same, with the only difference how fast we crash, and whether they come in pairs or triples - like 1929 thru 1933, and 2000 thru 2003 - or singular events - like 1987 and 2007.

1998 was the lone failure, where the crash was only 30% from the peak, and the indexes soon rocketed to new highs (versus the normal 50% to 90% drop that ends when the bull/bear cycle indicator says the bear should end.

So that's what I'm looking for here.

If we crash drop 30% and the central banks do QE4 and we rocket to new highs then that I believe would be the slingshot down to phase transition that targets Dow 40K a year later. Remember 1998 was followed by a doubling for the NAZ into its final peak.

If we crash drop 50%, then will be tracking the bull/bear cycle for signs of a bottom, which it signaled in late 1987 and early 2009. That indicator also said the bear had not ended till early 1933, early 1975, and early 2003. So a good indicator to follow no matter what happens. If we do see Dow 40K, then tis the end of the road, akin to 1929 UK and US peak, and 1989 Japan peak. Then talk to me a couple of decades down the road to see if things are worse than those experiences...

Hugh Jazole said...

"Dow 40K a year later." So, 40K in the next couple of years? I'm willing to entertain close to 30K in 5 years. "If we crash drop 50%" Not happening.

T.Berry said...

i doubt we'd crash 50% or 30% for that matter. like i've said, between circuit breakers, the fed and the donald there isn't going to be a crash. besides, the economy is firing pretty well these days. as for calling crashes, they're a dime a dozen, lost track of how many along with final tops and one last highs, have been called since 2012


as for japan, again, their market never came back yet whereas in LESS than 4 years, the us stock market was again at record highs and in 8 years the stock market is 70% higher than the previous peak. seems alot of people (especially the permabears who've missed the bull market of a lifetime) can't handle the truth that the fed got it spot-on this time. gotta have faith in the fed, they've been ahead of the curve for over 8 years. we will soon be going into the 10th year next march of this secular bull .


as for 23,000 we're a rounding error away. it's coming, probably once earnings reports start coming in. q3 will be better than the street is expecting in my opinion.

Hugh Jazole said...

T. Berry, the valuation chickens will come home to roost at some point. Here's a great read about where we are currently.

https://www.hussmanfunds.com/wmc/wmc170925.htm


Kevin Wilde said...

T.Berry, interesting you see short term history of the markets, yet continue to scoff at the longer term analysis history yields. I take the opposite view as to what happens next, and we will let our portfolio performance be the judge.

T.Berry said...

kevin,
not sure how we're like japan. our stock market crashed over 50% in 09 and in 4 years was back to record all time highs then in just 4 more years went up another 70%. japan still hasn't gotten back to all time highs on their exchange.

our fed is clearly superior to theirs and knew exactly what to do. the amount of wealth our fed has created for american's in the past 9 years is unprecedented.

we are very fortunate

Bryan Franco said...

My eyes are watching football, but my head is elsewhere. I can't help but wonder how on earth an entity such as the Swiss National Bank can print Francs to buy U.S. stocks, all the while being publicly traded! How is this legal?

Bryan Franco said...

How can "they" have the nerve to call themselves agents of financial stability? How is deliberately weakening the Franc by printing them, repatriating those Francs to USD, and then buying Apple, a foodchain that works in the interests of financial stability? And to be publicly traded to boot?

Hugh Jazole said...

"My eyes are watching football" Please tell me it's not the NFL.

Bryan Franco said...

On Saturday Hugh?

Hugh Jazole said...

Forgive my ignorance.

Bryan Franco said...

So much for being a 'boring bond proxy'

https://www.bloomberg.com/news/articles/2017-09-19/snb-shares-climb-and-climb-as-investor-seek-boring-bond-proxy

Christian Gustafson said...

If we draw a sharp key-reversal candle on the daily S&P like we did 10 years ago, why wouldn't every algo + mom go on a massive SELL for the following week?

T.Berry said...

just 9.5% from dow 25000. we're well within 12 months of hitting it.

23000 is just around the corner, with a final high of 40,000 lol

Hugh Jazole said...

CG, keep honing those chart skilz in on spring/early summer of 18.

T.Berry said...

atta boy hugh! kick it baby. lol

Hugh Jazole said...

T. Berry spring/summer of 18 will be another BUY opportunity for you.

Kevin Wilde said...

Looking for a one day wonder move to break us out of our malaise, but before TB gets too carried away if said big move tis to the upside, all that would do is complete the 1987 repeat I've been mentioning all year. If the big move tis to the downside, then, well, we will let TB let us know how painful that is. since I'm pretty sure he's too young to have experienced the dark side of the markets. ANY dark side.

T.Berry said...

lol hugh. thanks for the heads up. must be that 2012 the experts have been calling for : )

i happen to believe the dow jones will be well north of the elusive 23,000 (crash bang boom- LOL) and on the way to thee final op of 40,000. :)


kevin, still in the fall crash camp? if not then the market goes up?

T.Berry said...

oh and....

free beer tomorrow

T.Berry said...

pretty heavy volume on another record setting day. positioning for the earnings rally?

Bicycle said...

Heavy volume in what? Shorting volatility? Wasn't this the lowest volume day this year?

T.Berry said...

spy's traded 120% of their 90 day average. 74.8m vs 62.2m. mkts usually go up during earnings so this really isn't much of a surprise.

Kevin Wilde said...

Bicycle has it right, volume has been weak and contracting of late. On the question of a fall crash, we are in the part of the high risk blow off phase where tops are slated to land. The one I believed all year is the best fit is 1987 pattern, which, if that continues, then we should see the NAZ rally to the 6700-6800 range, before grinding sideways for a couple of weeks, before the crash begins. The problem with that is the NASDAQ remains trapped in an ending diagonal triangle pattern, which requires a big rally pop to escape from. Any acceleration pop would put directly in-line with 1987, while a failure to rally pop means crash begins from this position. On the question of earnings, how much has already been baked into the cake? Have you never heard of buy the rumor sell the fact? As always, tis not the news itself that future forecasting abilities, rather than the REACTION to the news. Sure, one can gamble and bet the reaction to earnings will be good, just as one can bet that the reaction will be bad. I prefer to follow the trends, while keeping a wary eye on risks and history. Trends say up for now. Risk says watch out below. While history says crash coming.

T.Berry said...

i can't remember the last time stocks sold off during earnings. the trend appears to be up into and through earnings.

as for volume, i follow the spy since i own it and today the volume was higher than average supply and demand thus another record setting day. as for the sept/oct crash call, i just can't see that happening. only 14 trading days left and we haven't even hit the sweet spot in earnings. that fall crash will get pushed back . that has definitely been a trend : )

Depriv said...

Yo

Old stuff (I think I posted it here once):
http://keptarhely.eu/view.php?file=20170607v00lfpf3b.jpeg

As it looks today:
http://keptarhely.eu/view.php?file=20171012v00mzppa4.png

Price is already around the target, but time is not ripe yet. For various reasons (wave count) I do expect one more bear trap ahead, more or less the way it is drawn on the second picture. Next year spring would provide the 'turning point'.

As for the top - this kind of accelerating fifth wave is hard to predict. Conservative guess is around 2570, but only one thing is 'sure' - it'll be higher than most would think...

rotrot said...

S&P 500 Elliott Wave Count (long term) - Grega Horvat | April 27, 2017
https://twitter.com/forexanalytix/status/857594711598653440

S&P 500 Elliott Wave Count (short term) - Grega Horvat | October 10, 2017
https://twitter.com/GregaHorvatFX/status/917645739332947973

Hugh Jazole said...

"Next year spring would provide the 'turning point'" That's the way it's looking. Not a crash necessarily, but the biggest downturn in a while. 2017 still looks fairly safe, sideways/bullish.

Kevin Wilde said...

http://stockcharts.com/public/1957888/tenpp/1

Hugh Jazole said...

Dullard speaks.

https://www.investing.com/news/economy-news/bullard-fed-should-defend-inflation-target-risks-losing-credibility-otherwise-540661

T.Berry said...

"biggest downturn in a while."

hugh,

back in summer '15 we had a 10% downturn. are you thinking it'll be more? if so, how much? 20%?

still looking at dow jones 40,000 as the top

T.Berry said...

"Next year "

that's been the trend since 2012. lol

Hugh Jazole said...

"back in summer '15 we had a 10% downturn. are you thinking it'll be more? if so, how much? 20%?" Hard to say just yet. 10-15% is probably a very safe bet, we're at much higher valuations now.

T.Berry said...

thanks hugh, that's basically a standard bull market correction. i think when we get to dow jones 40,000 it'll be more like 20%. then as with all tops, it'll be temporary and it'll end up going higher than 40,000 after the correction is over. need to remember, all tops are temporary. every single one 100% of the time.

as for expecting a crash, if you live another 60-70 years it's possible you'll see one. :)

Kevin Wilde said...

T.Berry, like the 1929 one that took 25 years to get your money back, or the 1989 Japan one, which is still cut in 1/2 some 28 years later? Or the South Sea bubble one that took a century and more to recover from? Or the Tulip Bulb one. What we face is closer to the latter, and buy and hold will get destroyed for a lifetime when the turn comes.

T.Berry said...

kevin,
as for japan, i don't believe we're anywhere near like that. our fed proved they got it right after the meltdown in 09' our stock market was already back at new record all time highs 4 years later. they proved we're not japan!

we almost had a repeat of 29' back in 2009 but the fed stepped up and got it right. back in 1929 the fed didn't have the tools they have today. a repeat of '29 in my opinion would never happen again as the fed passed that test in 09. besides the market updated the circuit breakers policy back in 2013.

just what constitutes a crash anyway? 15%? 20%? 25%?

Depriv said...

"back in summer '15 we had a 10% downturn. are you thinking it'll be more? if so, how much? 20%? "

My bet is a 25-50 year sideways period around the top and 400-700.

Everybody is free to take it as a looong series of doomsdays - or as a base-building before the next big upward thrust. Both would fit.

Kevin Wilde said...

T.Berry, what we face is a generational bear that corrects over a hundred years of bull market. That makes this the worst set-up since the South Sea bubble and Tulip one, the kind that ended Rome's power. We face many decades of misery, with each decade worse than the last, though of course there will be some good bounces along the way. Just not ones that breaks us out of our economic fate. Governments around the world are bankrupt. Central banks are bankrupt. The financial system is bankrupt. At a minimum we face a 50% loss to start, with that followed by a 80% to 90% loss. That is normal bear market action, and were it not for the demographic and fiscal big picture mess we are in we could look at better times ahead once we hit the down 90% reset. Unfortunately, demographics and fiscal situation are great and helpful like it was in 1933, when the US was a virgin undeveloped country facing a huge demographic growth spurt. Now we have the opposite. The numbers simply do not lie, and what cannot be mathematically, will not be. US, European, Japanese, Chinese, Russian citizens are not going to get their pensions, they are not going to get the healthcare they need, anyone with money will hunted down and taxed to death. The financial world has we know it tis over. Yes, we will be better off as a world for the experience, though the darkness we must suffer between now and then is of the history making times, more like 1930s Germany. As the people in Winterfell put it, the children of summer know nothing of what is coming, and sooooo unprepared for it. Yes, we may see the Dow at 40k, but only after a 30% crash, and even then it would not change our fate. Only the arrival of people from out of space - or other awesome unforeseen act of God that changes the mathematical and demographic variables - can safe us. The fate of the world is set.

Kevin Wilde said...

Nice earnings from JPM and Citi, yet the stocks tank. Hmmm, I thought stocks only went up on earnings?

Hugh Jazole said...

"I thought stocks only went up on earnings" Earnings of many high fliers in the late nineties were terrible, overall earnings in 87 were stellar. Little correlation when the broad market is moving one direction or the other.

T.Berry said...

" I thought stocks only went up on earnings?"


dow jones this week

monday up
tuesday up
wednesday flat
thursday up
friday up

up just a tad over .5% this week.

doesn't look like the sept/oct correction/crash is going to happen.

sounding like a broken record but lol today brings another batch of new all time record highs.

Kevin Wilde said...

Yes, we remain on top watch, though the bulls are hardly making headway either. The 1987 pattern - which is the one I, and the NASDAQ, has been tracking all year - requires the NAZ to peak around 6850 level. To do that, the NAZ needs to pop across resistance of the upper trend-line of an ending diagonal triangle, with that resistance level stopping all rallies the past couple of weeks. That rally pop remains as MIA as the reversal day to signal the top is in. Till such a big up day lands, the bulls cannot relax, and when - if - we see such a rally acceleration, a 1987 crash awaits the bulls as the NAZ nears the 6850 level. So big bad bear starting now, or after a run to NAZ 6850, remains the technical story. I remain with the bulk of money in QLD, hedged with small amounts of TZA and TVIX, up about 53% on the year.

T.Berry said...

"NAZ to peak around 6850 level"

wasn't the peak supposed to be 6729? did something change?

not to be a smart @ss but every crash target seems get pushed higher and higher over the last 6 years.



still looking at dow 40,000 is the top (albeit a temporary one).

Hugh Jazole said...

Hey T. Berry at least this bear was bullish on 2017. Not sure I feel the same about 2018 though.

T.Berry said...

right on hugh! 2017 has been outstanding as has the past 6 years. 2018 will be ok. not expecting a year like we've had this year. set a very conservative 2800-2825 s&p estimate although i reserve the right to raise it like this year (original target 2500 raised to 2550 in the spring).

Kevin Wilde said...

T.Berry, as we near the target, I calculated the exact end zone, versus a projection made earlier in the year. I do that for the open minded people in the group for those who give a damn. Some day I expect you too will join that group. Since the topic of this group is deflationland, and since your posts are always counter to that view, one can only conclude you are here as a spoiler. If that assessment of you is wrong, and you are indeed here to learn, and judge fairly, then let's start at the beginning: how old are you, and what kind of investment skin in the game do you have?

Hugh Jazole said...

"how old are you, and what kind of investment skin in the game do you have?" I'm guessing T. Berry was not long any significant amount of money circa 2007.

T.Berry said...

kevin,
yes i would love to learn however i do not believe we are in a deflationary period nor close to one. i am a long term buy & holder that price averages in. go back 2-3 years and read my posts that i have been pretty much all in. as for age, lets just say i'm old enough to be president :). and at this point within 10 years of retiring.

i have been maxed on on my 401k and my online non-401k portfolio account have both been 100% invested on the long side. i currently see no reason to sell at this point. i believe in 10 years when i'm ready to begin scaling back from the markets they will be considerably higher than were they are today. one thing i have learned is that the stock market comes back 100% of the time, you just need to make sure you have enough time and are patient. given my time horizon is 10 years i'm very comfortable in my positions now. do i think we'll have a correction? heck yeah! bull markets always have corrections. am i going to get spooked out like those who did in 2009? no way. i'm a long term investor not a trader like many who post here. i wish you all the best in trying to pick an intermediate top however for me it is easier making money in a secular bull by staying on the long side.


T.Berry said...

hey hugh i was in the market in 07 however not as deep as now. i took my lumps and did sell in a panic however got back in in 2011 (no i didn't catch the bottom:( ) awelnd have never looked back. it's been an amazing 6 years years though. all the best to you! be careful getting too bearish in 18' it may surprise you how well the markets respond.

Kevin Wilde said...

T.Berry, glad you hear that your retirement plan is on track. Sorry to hear that you plan to risk that retirement to the whims of the market when there's a much easier and safer way no matter what happens. The starting value in the performance chart is 100, with the black line buy and holding the NASDAQ, and you should factor in at a minimum a 50% hair cut along the way (though my expectation is a 80 to 90% haircut.) The purple line is a simple 401K approach that trades into a stock index mutual fund on stock market uptrends, and moves to a money market fund when the stock market is in sell mode. Note how many more zeros one would have following the trend over buy and hold, AND that has defense against bear markets and crashes, where as buy and hold does not. Even if risks were low here (had we been in a bear markets for years and valuations super cheap) trend following is clearly a superior investment approach, Had in the extreme risks we currently face, tis a no brainer. The green line is how I invest, following a +200% thru -200% allocation model based on trends and risks. Once again, focus on the extra zeros one gets over buy and hold.

http://alphaking.com/performance/

Kevin Wilde said...

Real investment advice for those who care about risk versus reward

https://realinvestmentadvice.com/the-coming-snap-back-of-markets-10-13-17/

Hugh Jazole said...

Check this out T. Berry.

https://inflationdata.com/Inflation/Inflation_Adjusted_Stock_Price/NYSE_Inflation_adjusted_stock_price.asp

"So rather than a 23% increase, if you count inflation and had held stocks for the 16 years from 1966 to 1982, you would have actually lost about 59% of your purchasing power due to inflation."

Kevin Wilde said...

How about the NAZ at 6608 returning 1.19% per annum since its peak in 2000. NAZ goes down by 50% (minimum expectation) NAZ will have made no money since mid-90s.

T.Berry said...

kevin,
had i listened to all the experts back in 2012 who called 1400 "thee top" only to change it about 50 times (ie 1440, 1493, 1515 etc......) my balance would be half of what it is today. i'm staying the course and sticking to my plan.

hugh, the key is to price average in. you win 100% of the time as i've said before the stock market will always come back. has 100% of the time.

as for earnings and the market, we're up over 1.5% since they began. not to say i told you so but that has been a very strong trend over the last 5-6 years. earnings continue to be strong as is the health of the us economy.

i wish you all the best calling the top (albeit a temporary one) but believe the targets will continue to climb as we've watched for the last 7 years.

T.Berry said...

kevin,
as for the nas, if you we're disciplined and price average in, your returns would be considerably higher. if you just bought and hold depending on where you got in on the naz you may not have done very well.

Christian Gustafson said...

A retest of the April lows is in order.

Kevin Wilde said...

T.Berry, you seem to think that its all bull or all bear, in that "if I'd listened to the bears back in 2012." Well, how about following the trend? That way, you can bearish and still make money, or bullish and still not get wiped out WHEN the bear comes.

When valuations and stock prices are high - such as they were in 2000 and 2007 - forward returns are essentially zero for the next decade with the potential for a massive hair-cut along the way.

When valuations and stock prices are low - like they were in 02 and 09 - forward returns for the next decade are seriously double digit.

THAT is what happened. You bought near the 02 and 07 peaks and you made almost no money, despite new highs and another massive bubble. You bought after the bear and you made out like a bandit. Dollar cost averaging only works if there's nothing better - there is - and even then only if you have little money now compared to how much you are putting in in the future.

Talking of friends, Martin Armstrong private blog today talks of potential melt-up if Dow can make another high here, targeting 23,700 in quick order. Of course that would complete my 1987 repeat expectation, perfectly, though let's not quibble over minor details.

T.Berry said...

kevin,now
price averaging is working well. given my 10 year time horizon it should work out ok. as for timing the trends, i don't have the skills for that nor the ability to time the market.

as for armstrong, isn't he the one who said if the dow jones busts past 23,000 it's on the way to 40,000? if so, wouldn't 23700 be considered a bust through? again, it seems the bears targets always get pushed higher.

i highly doubt we'll ever see the dow below 20,000 or the s&P below 2100 again. only a matter of time now that 23000 goes down. next target is 24000 which is just less than 5% away then onto 25000 within the next 12-18 months.

T.Berry said...

don't forget earnings drive the stock market higher :)

T.Berry said...

kevin,
year end (2017) where do you see the dow jones & sP & nasdaq? rough ballpark figure

T.Berry said...

cg, yeah a nice pullback to the april lows would be a very healthy move for this bull market. may have to wait till earning season is over though. good set up for the year end rally

Bryan Franco said...

T. Berry... You have been talking about your 10 year time horizon for well over a year now. Is that horizon not getting shorter? Like, shouldn't it be at 8 or something?

T.Berry said...

bryan,
it's like calling a top it keeps getting pushed back so i'd have about a 6-7 year cushion lol. just kidding. i believe i originally said 10-12 years but i'm looking at 2026/2027 or maybe sooner depending on market returns. that is well before normal retirement

Kevin Wilde said...

Earnings DO NOT drive stock prices. Never has. Never will. Money flows drive stocks prices, especially in regards margin debt of big money. They build em up, then the turns comes, and the markets crash and burn to wipe out the unprepared.

Dow 23,700 is the updated number to cap this leg of the bull, per Martin A (and only then if we see the Dow make another high here, where a failure of that opens the door to a painful correction.) Eventually, Martin expects Dow 23.7 to get taken out, with that opening the door to 40K that he likens to 1929. But don't forget even he concedes we may see the markets tank 30 to 50% prior 23.7 getting taken out.

I personally believe we are within spitting distance of the turn from where a ROYAL corrective push will emerge, with 1998 30% downer in a hurry, competing with 1987 down 50% even quicker, competing with 2007 down 18% rally back to close out the year with hope (and we know how the following year ended.) I will update as the winning pattern reveals itself. Once the top is reached, I doubt we will see it eclipsed for one to two decades.

T.Berry said...

thanks kevin, but doesn't strong earnings like we've seen over the past 6-8 years drive money into stocks? why else would money flow in? i believe the fundamentals count and frankly they've been strong and getting stronger. the biggest fear is the economy begins to over heat and we get too far ahead of ourselves.

so is the sept/oct crash is called off now?

bet we see dow jones 40000 before we see a 50% correction. no different imo from the calls since 2012.

Kevin Wilde said...

first off, kudos to Martin Armstrong's 23K target, which he said back in 2011 would happen.

what drives stock market action is whether margin is rising or falling from the big money players. See chart in link below showing margin debt never being higher. These big money gamblers on debt are what give us bubbles, busts, and financial crises (aided by the FED.) These guys think nothing of earnings, nor of any fundamental, beyond whether they can get their hands on more debt to gamble with in the stock market, as well as checking their cojones to see if can go one more round.

Earnings are noise in the markets to fool the average Joe and Jane into believing the stock market is logical. Stocks trade a wide range of earnings valuations, where one time stocks trade at 40 times earnings, the next 4 times, with the difference the amount of margin debt being implode, as well as whether the margin debt is contracting or expanding.

On 2012, if I recall it was a very difficult year that saw the markets go no where in the end. While 2013 was a big up year - where my trend indicators stayed long the entire year - stocks went no where in 2014/2015/2016. This year has been good, so 3 good years since 2009, versus 6 sideways churn ones. Many smart people bought the 09 low - like me, and the guru's I track - and simple trend following would have ensured one was on board 2013 and 2017 go somewhere moves. Sure, buy and hold ensured that too, though that also ensured an entire give back of those gains when the next bear lands. Just because someone calls for a crash in 2012, and it didn't happen, does not exclude a crash here, there, or whenever. Crashes and bears require certain elements to be in position, such as record high margin debt at bubble levels (which we have NOW, though not in 2012.)

I was looking for a September/October bubble PEAK. The crash happens once the final tick is delivered, though topping process may take many weeks or months before we get in the crash positon.

The trend remains up, so being positioned long remains called for. Take profit on any move above NAZ 6800. Risks are extremely high so hedges are called for. Add more hedges and raise a lot of cash at 6800, or if the trend turns negative before then.

The big picture is one of bubble topping, and while we are close, we are not there yet. When those three variables change - trend, risks, what comes next in the big picture - then one changes the investment allocation.

Kevin Wilde said...

margin debt link here
https://www.advisorperspectives.com/dshort/updates/2017/09/26/a-look-at-nyse-margin-debt-and-the-market

T.Berry said...

kevin,
3 good years since 2009 but overall the stock market tripled off the lows and exceeded the 2007 high by over 70%. pretty impressive especially if you were buying off the lows. as for martin, that's awesome he called 23k back in 2011. there were many who called the crash ahead of time too however since they have been completely wrong about the stock market (see jim rogers, peter schiff, kyle bass to name just a few). seems everyone gets a home run but the follow up calls are busts.

as for armstrong what i don't get is he first said if the dow jones busts through 23k it's on to 40k and now if i understand correct is calling for a possible melt up to 23700 but still a chance of a crash. i guess he's covering himself.

well it was bound to happen sooner or later, 23k goes down today.

we are now just a hair over 4% from the next round number, 24000. it's not out of the question we could get there this year but i'm guessing we'll have to wait till the first of 2018.

T.Berry said...

forgot to include marc faber . too funny he's been calling for a crash for 5 years and is out again today touting one lol. free beer tomorrow marc lol

Kevin Wilde said...

But of course your buy and hold is never wrong or early?

I expect Martin to have more than Dow hitting 23K. Will pass along if anything useful. He has always said 23K will be hit, though provide stiff resistance. Eventually he expects us to get through that - probably after a down move that gets everyone bearish to provide the fuel for the breakout. He calls that a "sling shot", and the blow from 23K to 40K the "phase transition," like we saw going into the 1929 and 2000 peaks. Of course, since you seek perfection, you dismiss what he says going forward, since now his 23K call that he made back 2011 (if not earlier) has been adjusted to 23.7K.

Interesting that 700 Dow points (3%) would drive the NASDAQ into my 3850 target should the NAZ perform similar to the Dow. Note NAZ and SP not following Dow today.

I have been wrong before, so feel free to dismiss me too.

T.Berry said...

i'm just interested in the sling shot to 40k which i'm confident is going to happen. once there, i'll likely be out and sitting on a pile (huge) of cash. the sooner the better too. i may end up retiring well before 10 years.

good luck to you kevin.

T.Berry said...

clarify, confident we'll see 40k just not that it will necessarily be done in a slingshot fashion. i'm confortable waiting 5-6 year for it to hit

Bicycle said...

If we are to hit 40k the move from 30k to 40k will come faster than the move from 22k to 23k did

you don't really want that

even 100% long your purchasing power will be falling faster than you can believe

you'll be better off with arable land that can produce without petrochemicals

Hugh Jazole said...

"even 100% long your purchasing power will be falling faster than you can believe" That's why it's not going to happen.

T.Berry said...

the move to 40k will be slow and steady, it's a marathon not a race :)

hugh, the move from 22k to 23k only took a month. a 33% in the same time would be crazy :)


dow jones up 5 of last 6 days since earnings starting rolling in. earnings earnings and earnings has been the trend over the last 5/6 years.

just another 4% till 24k. don't think we do it in the same time as 22k to 23k. it could take 2 months maybe even 3. as for dow jones 25k we'll see it within 12 months now as it's less than 9% away. slowly but surely the market continues grinding higher on the journey to dow jones 40,000.

T.Berry said...

actually we could see dow jones 25,000 by next june

T.Berry said...

oops, i meant to comment to bicycle not hugh on the move to 40k from 30k. sorry for the confusion

Kevin Wilde said...

If we get from 23K to 40K I expect it to happen in under a year, just like 1999. But first the sling shot test that is more likely to confirm THE top is already in, rather than a fake out crash that hits new highs. I'd put it at 66% chance that we crash and burn well prior to 40K, and 33% chance we do a 30% crash that reverses to see the Dow hit 40K within a year. Glad to hear T.Berry has a plan to sell if he gets his dream move. Maybe there's hope for him yet?

Kevin Wilde said...

BTW Martin A says Dow 23K to 40K phase happens quick, like 1929 and 2000 NAZ, though no yet ready to make that move yet...

Bryan Franco said...

0.85% range over the last 10 trading days in the S&P 500. I have never seen anything so bizarre.

Hugh Jazole said...

LOL @ Marc Faber!

T.Berry said...
This comment has been removed by the author.
T.Berry said...

23k didn't seem to be much of a problem. it's possible we see 24k this year and no doubt 25k by next spring/summer (or sooner). this market just keeps getting better and stronger with age.

epic bull (secular)market of a lifetime. just like the 2008/09 meltdown was a once in a lifetime event.

40,000 and counting --- only 73% more to go : )

T.Berry said...

Kevin Wilde said...
Glad to hear T.Berry has a plan to sell if he gets his dream move. Maybe there's hope for him yet?

October 17, 2017 at 3:24 PM

lol kevin.

yeah, had i listened to the experts i'd have sold back at the s&p 1400 top. lol or the 1493 one or the 1515 one lol. depending on when we hit 40000 will determine how much i'll sell. if it takes 5-6 year i'll most likely just scale out a little at a time however if we hit 40000 in less than 2 years i'll sell most and wait for a correction. either way, in 10 years stocks will be considerably higher.

only 3.5% till 24k

Kevin Wilde said...

T.Berry, Your trading plan has improved immensely, and all you need now is to work on your defense and you got it! If those bears also didn't have a defensive plan and continued to bet against the trend (name any year you want,) then, well, they know the error of their ways. Tis not about opinions and being right or wrong. Tis about making and preserving money in all market environments. Buy/Hold/Hope that the future will remain bright no matter what is the SAME as bears expecting the market to crash and burn. Both are happy when the markets do their bidding, and get wiped our when the markets have a different opinion. Since no one is right all the time, and since the markets operate by the majority positioned one way before wiping them out by going the opposite way, some trading skill and assessment of risk and trends is critical. Seems like you are headed in the right direction.

Hugh Jazole said...

Time to spook the sheep before the massive year end rally.

Kevin Wilde said...

For the bears, AMZN H&S top complete? 1020 L and R shoulder, 1080 head, 940 neckline crash point. AAPL looks sick too. And how about IBB long term chart? There's the fuel for bear collapse right there.

For the bulls, is that a two stage rally for RUT? If so, should find support at the 20 day MA, to rocket too new highs. Will the 20 day hold though?

T.Berry said...

yep hugh, shaking out a few weak ones before the next leg up. they will get mine as we close in on dow jones 40,000 : ) ..... ho ho ho, santa is coming :)


how about those jobless claims? outstanding and more proof the economy is firing on all cylinders. and you ask why does the market keep hitting new all time record highs lol


like the healthy pullback earlier today. sets up nice for the next rally

T.Berry said...

hugh, seems they are going to have to do a bit more to spook out the sheep. buyers heavily outweigh seller besides it looks like not many willing to sell at these prices either.

up 8 out of 9 days during the first 2 weeks of earnings season. strong 4/5 year trend holding up well.

armstrongs 40k is looking good : )

Kevin Wilde said...

Sounds like stocks have reached a permanent plateau to me...

Kevin Wilde said...
This comment has been removed by the author.
Kevin Wilde said...

For those who are unfamiliar with "stocks have reached a permanent plateau" should google the term to gauge the implications of those famous words.

T.Berry said...

i don't believe so kevin. more new all time highs today : )

T.Berry said...

if tax cuts go through this year dow 24k is on deck to get taken out. we'll get to 25k way before next spring/summer when that happens . the journey to 40k is moving forward :)

Hugh Jazole said...

Must read post from Pretzel today.

http://www.pretzelcharts.com/2017/10/the-acrobats-why-central-bank-driven.html#more

Bicycle said...

Related to that Pretzel article, ZH posted BoA's chart of CB liquidity yesterday. Peak is basically March '18, then it begins to fall.

I'll throw out there that it IS possible that we can hit some absurd level like S&P 4000, DJIA 35k by that time frame. A 50%, epic, blowoff rally over 5-6 months.

This would be completion of wave 5 of some potentially very bearish long term patterns running since post-WW2.

NO ONE will be willing to take bearish positions after that and the central banks will all be in a massive panic about asset prices.

Hugh Jazole said...

"Peak is basically March '18, then it begins to fall." That's inline with what I'm seeing. Not sure if it's THE peak, I kind of doubt it.

T.Berry said...
This comment has been removed by the author.
T.Berry said...

throw out the charts, they don't work, haven't for the last 8 years

stocks are held by strong hands, have been for a while too. they ain't selling either. that is why the market is going to continue going up for a very long time. think 5th inning. and "next year" isn't the end imo.

Kevin Wilde said...

T.Berry, the charts work, though not every one knows how to read and interpret them. Just because stocks are up today does NOT forecast what happens tomorrow. Come on, surely you're not THAT naïve? Stocks are held by big money speculators gambling on today. They don't give a shit about tomorrow, nor about fundamentals. Nor do they care about collapsing the financial system when what they do fails, and there goes the system. We are in 15th innings, not the 5th. Fine that you're saying today is up, were you actually forecasting that, though since you are buy/hold/hope you offer nothing, and I'm done responding to you. I suggest you move on to a more bull focused board, since your participation like this going forward would simply confirm my view that you a spoiler, and the folks coming here do so for a reason way beyond your comprehension and desire of comprehension. Goodbye, and I will see you on the other side, and one of us will be dishing out the soup for the other.

john said...

Yeah sure and the Japanese economy is firing on all cylinders too because all the fundamentals are healthy , that’s why the Nikkei is at all time highs too? What a load of crap. The JCB got it right this time as well T.Berry?

Kevin Wilde said...

Great stuff from McHugh.
https://www.technicalindicatorindex.com/subscribers/guest-articles/McHughs%20Article%2010.20.pdf

Kevin Wilde said...

more good stuff
https://realinvestmentadvice.com/examining-the-most-hated-bull-market-ever-10-20-17/

Hugh Jazole said...

"more good stuff" Not bad, but I would avoid traditional bond funds like the plague. Stick with stable/money market.

Hugh Jazole said...

"The truly civilized man is always skeptical and tolerant. His culture is based on "I am not too sure.”

― H.L. Mencken

Kevin Wilde said...

interesting stats on ISM and stock markets returns
https://finance.yahoo.com/news/goldman-sachs-warns-peak-growth-falling-stock-prices-3-6-months-100353338.html

Christian Gustafson said...

onoz ... teh rising channel break ...

Kevin Wilde said...

ending diagonal triangle for NAZ held. XLF clear 5 wave advance, which suggests tis all over. trannies testing neckline of H&S top. RUT still looks like only a 3 step advance, so might have one more blast off push to new highs. So no cigar for either the bulls or bears, though volatility is sure about to explode for the remainder of the year.

Kevin Wilde said...

Per Martin A private blog post: looking at an October high that results in a correction into December OR we hold here and rally into a December peak. All depends on how October ends and November begins, with lower lows = bear into December, while higher highs = bull continues into December. On a daily close 22970 is key, with 22415 the weekly technical line in sand between bull versus bear correction period that lies ahead.

Hugh Jazole said...

"OR we hold here and rally into a December peak" That one.

Kevin Wilde said...

Got your hedges on?
http://stockcharts.com/public/1957888/tenpp/1

Kevin Wilde said...

For the bulls in the room, Martin A Dow update shows Dow has yet to trigger bearish reversal, which leaves door open for blow off to continue, and possibly begin the phase transition phase. If the latter happens, Dow could hit 28K next year, and possibly 55K by 2020 if we see a plateau move similar to 1929. However, we remain in a Missouri show me market, and correction would be on if we see Dow sliding here, especially on lower lows for daily, and weekly, then monthly basis.

While Martin did not mention the sling shot possibility here - where market tanks bad, then rockets to new highs to begin the phase transition - I believe that is the best the bulls can hope here, similar to 1998 that led the glorious blow off into 1999 and early 2000.

Martin suggests waiting for evidence of what we face before acting, which means become a bull on any breakout, and a bear if we start to see support get taken out.

Bryan Franco said...

i posted this on Caldaro.

I think the steroidal sector rotation phenomenon that has fueled the mkt all year is at the end of its rope. This gasp in AMZN, MSFT, INTC, GOOG can’t even get the S&P futs green. The critical tell will be if these names fade all day. Buying seems exhausted for the broader mkt. We have seen this movie before, but it is rare, and comes at major market tops (at least major degree).

Kevin Wilde said...

Interesting, perhaps, is the turn coming in Martin Armstrong's cycle, which you can see by copying and pasting the link. The current rally was slated to begin late 2016, and end November 2017, and here we are, with the chart saying what comes next is drop into a MAJOR low into 2020. However, Martin is out this morning thinking that phase will invert, and we rally into a 2020 peak, though not sure I'd be betting against his cycle (which calls for a major downturn beginning early November this year.) The last major buy from his cycle was mid-2011, and that one turned out not to be bad call, was it?

Kevin Wilde said...

https://www.bing.com/images/search?view=detailV2&ccid=KmMtoIum&id=98957BC2890A33D7035365B730DA1861B368EFDB&thid=OIP.KmMtoIum8pA5IDc1JB3BkwEsCu&q=martin+armstrong+cycle+chart&simid=607998342520374001&selectedIndex=0&ajaxhist=0

Hugh Jazole said...

You'll love this CG!

https://akamaitree.wordpress.com/2017/03/20/deep-state-misappropriation-the-cryptocratic-clique-behind-trump/

Bryan Franco said...

The S&P equal weighted index is down today. Not buying the hype.

Christian Gustafson said...

FWIW, the top of the rally channel is about 2611 SPX into Weds FOMC next week.

The petro-Yuan elephant in the room suggests that a little Amish austerity may be ahead. China has proposed an existential threat to us with this one.

The West can drain liquidity and collapse their debt ponzi ahead of ours.

Otherwise, petro-Yuan goes live and the $USD is a zero.

Kevin Wilde said...

I love this line in this article on the FED: did I miss a crises?

https://realinvestmentadvice.com/the-fed-balance-sheet-unwind-myth/

TSE said...

"That's a reference to Dreiser"

"The Great Depression of the 1930s ended Dreiser’s prosperity and intensified his commitment to social causes. He came to reconsider his opposition to communism and wrote the anticapitalist Tragic America (1931). His only important literary achievement in this decade was the autobiography of his childhood and teens, Dawn (1931), one of the most candid self-revelations by any major writer. In the middle and late ’30s his growing social consciousness and his interest in science converged to produce a vaguely mystical philosophy".

https://www.britannica.com/biography/Theodore-Dreiser

With the advent of Technocracy, Trans-humanism will commence - as we (once again) begin the ascent from Feral Beasts to Gods.

Numbers are infinite only have meaning when they have been differentiated. The Wizards at the FED know this - and even EROEI has become irrelevant. The night sky is passing from the Age of Pisces - to that of Aquarius.

Enjoy! https://youtu.be/BKAYGVIkbok

TSE said...

Since the beginning of the year, the Federal Reserve has been heavily discussing, warning rather, they were going to begin to “unwind” their gargantuan balance sheet. As Michael Lebowitz recently penned in his subscription-only article “Draining The Punchbowl:”

LOL!


DRAINING THE PUNCHBOWL.... Ummmmm..... Steven Kopits already addressed this issue:

https://youtu.be/dLCsMRr7hAg

And so did Dr. Albert Bartlett:

https://youtu.be/e_VpyoAXpA8

Get yourself some Existentialist Gum from Archie McPhee

TSE said...

https://mcphee.com/collections/new/products/existentialist-gum