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Special Report

 

Date October 4th, 2009

First a little reveiw of the comments I have made in past newsletters:

  • August 22 (thereabouts) Derivatives problems reappear in the weekend press reports. Maybe something scary after the Friday (21st) close. Maybe FDIC closes some huge number of banks?
  • Following weak, market drifts down with sharp rallies offsetting things to let the Big Boys out.
  • Mid September, downside action building. Short term panic low maybe around the 15th and a chance to play a bounce rally into the option expiration.
  • Month end rally (Sept).
  • Ugly October.
  • October 25th Iran bombing or market crash date.
  • November 4-8 Administration under fire for something or other and getting very defensive.

Up to this date, the predictions seem to be coming true. Now what?

Looking ahead, I am confident the other shoe is going to fall this month making it just as ugly and scary as last October.

My observations:

  1. GANN: The last two Gann reversal dates (09/18 and 09/30) appear to have coincided with the last two highs in the market. The next upcoming Gann Angle convergence is 10/19, (+/- 1 day) which marks 90 trading days from the June high and roughly 180 trading days from the January secondary high.
  2. Murrey Math: the September high was nearly a perfect hit to the 8/8th MML, which is considered the strongest MML in this theory. A bearish indication.
  3. Bearish Divergence: Many multiple instances of intermarket in the last two weeks.
  4. Sentiment has gone quite bearish, and the urge to sell is spreading quickly. I can see sudden and voilent surges in market emotions over the next couple of weeks.
  5. Gold and Silver highs are holding as well as highs in the Euro and Swiss Franc, while the U.S. Dollar has fallen to its lowest level against the Japanese Yen in over 14 years. The 'official consensus' is that the U.S. Dollar should descend another 20+%. Not good for the so called recovery. Is this why Gold is holding?
  6. The Dow: Ominous Parallels to the 1929-1930 Era
    Excellent article: http://www.safehaven.com/article-14632.htm
  7. Astrological Factors: www.mmacycles.com
    The Saturn-Uranus opposition reversal continues. It has a 100% historical correlation to 4-year or greater cycles in U.S. stock indices during the entire period it is in effect. Along with the conjunction, it is the only signature we know of that has a 100% correlation.
    But it now begs the question: what was the significance of the recent high in world stock indices? Will the Dow Jones Industrial Average plunge approximately 2000 points in the next couple of weeks as it did on the first two passages of November 4, 2008 and February 5, 2009? It has already lost about 5% and 500 points from its high the prior week.
  8. Elliott Wave: It appears the 'C' wave has begun. 2000+ point loss in the DJI is possible.
  9. Candlesticks: Monthly and Weekly candlesticks are pointing to a reversal down.
  10. Preditions from the Time Monks: See colored box below.

Urgent Web Bot Update Ref: 10/25

Source: http://urbansurvival.com/week.htm

The following in from Clif at www.halfpasthuman.com on Saturday - changes somewhat our expectation for the way things will be working out both in markets and in the defense world over the next month:

"Heads up! Reality Change Ahead!

in running our MOM (model of modelspace) cleanup of the lexicon prior to tuning, it became apparent that October 25 turn in emotions globally will be dominated by a [lock down/implosion] of the [planetary financial/banking system]. The data suggests that such things a [currency trading] and [commodities trading] as well as many other [digital trading forms] will be [suspended]. Some will never resume, or if they do, they will be in entirely different forms. There may be a [banking lock up] in many countries emanating from the USofA outward. There may be [inter bank lock downs] in which [central banks] and [wealth storage clearing houses] will not be able to function. There are data sets suggesting that the rapid shift into building tension language on the 25th originates from and is propelled by the [financial system implosion] that then morphs over into [dollar rejected by all] a mere 10/ten days (more or less) later. There may be shut downs of all kinds of banking activity within the USofA and the rest of the anglosphere.

The [sudden/urgent travel] of the [administration (obama et al) minions] in early November, under this MOM background load shows up as being about [desperately trying] to get the rest of the [planet] to [loan] the actual [resources/wealth] to [restart] the [USofA banking system].

This MOM data set can be wrong in a way that the larger modelspace can not. The MOM set is so small that if it is wrong it is usually widely so. However, the data sets here are so focused, and bring in such crisp emotional shifts relative to the same days (10-25-2009), that it made sense to prepare this note.

If correct, this is the beginning of "The Big One" relative to the dollar and the central banking system. Everything else in the modern world depends on this structure...so it will be a big one throughout all of the social infrastructure.

If MOM is correct, then the [dollar death] will be way more dramatic and waaaay shorter than i had first thought. MOM is showing very dramatic language shifts (albeit against a much smaller background) for not only October 25, but also in a very sharp crocodile tooth pattern from November 4 through December 10th indicating a very very emotionally choppy time.

So, heads up! Reality shift (time/event bump) just ahead. If MOM is correct, there will be some additional levels of [visibility] on October 10th through the 15th that will put a focus on the 'trigger' that will show on October 25th and beyond.

Masa Katsu! Pie up now, panic later.

clif and cathy and igor.

The usual caveats here - doesn't mean, for example that war between Iran and Israel won't happen, it just means if it does (which is may anyway) it will be so far down the food chain as to pale in terms of personal impact.

If you didn't have anything else to do this weekend, you might be pondering: "How could I survive - and for how long - if there were market suspensions, hold-ups of executions of electronic transactions and all the other things other countries have gone through when faced with calamitous financial events? Refer to any Argentinean or Icelander who's been there... Sure means out earlier piece this morning may be closer to the mark than comfortable....

Waiting for Black Monday

Maybe it will be this coming Monday - or maybe one after that - but the forces which have been building as this 'bounce from the first leg down' in the market continue to evolve, I can tell you the absolute last place I'd have money today would be in stocks. I spent part of Friday working on the subscriber report (www.peoplenomics.com) for this weekend and the Dow still appears to be higher - by a factor of more than two - than competing investments. Lots of myths and 'old sayings' from that period which will be reviewed in Sunday's report. But most stem from common sense - you can't live high on borrowed money forever - yet with a continuing balance of payments deficit, a moronic mantra like 'strong dollar' and an increasing lag in manufacturing, the American dream stands on the precipice of becoming the American nightmare. Such is the stuff of economic tipping points.

Speaking of which, time for your Saturday morning count of banks to go down:

Southern Colorado National Bank
Jennings State Bank
Warren Bank

Only 10 branches, so just 3,726 branches have been reorg'ed since IndyMac in May of last year. That's not so bad, is it?

The good news - if there's any to be read if one takes off the rose-colored glasses about this economy - is few and far between. September payrolls dropped 263,000 jobs and given that the cash for clunkers is over, auto sales tumbled and on and on goes bummer headline after bummer headline.

If you want to read some fine 'whistling past the graveyard, click over to the Wall Street Journal which reports the "IMF Chief: Double-Dip not 'Key Scenario". Yeah, right, you betcha, sport.

Not saying that this next week will bring a further market collapse - the hype may keep things intact a while longer. But at some point, global recognition of our 4.6¢ dollars (that's how much has been hollowed out in purchasing power since 1913) will start to dawn on people who we've been depending on to keep us living high on borrowed money.

Next week's Treasury auctions will be closely watched, since China is not expected to be stepping up. The g-7 finance leaders are meeting this weekend in Istanbul (Turkeys anyone?) and may not be able to issue a joint statement. Could it be that's because the US if babbling about 'strong dollars' and other participants know how to read a balance sheet?

Stopped Out

"InStop abruptly closes all 152 retail stories and lays off all workers" reports a Cleveland.com headline.

Wasn't it just last week I was telling you to expect a swarm of small business closings about October 1st as companies which had been counting on (bought into) the 'recovery is just ahead pant load would be having to file BK or reorg? Tell me about this '

recovery' again, wouldja...

 

Final comment: Duck-and-cover

--Rob

 

 
 
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