Weekend Commentary

The stock market continued lower this week and precious metals began the expected waterfall decline. On Tuesday, the market rallied 4% but did not dissuade me from the short side. The normal 8 day cycle low due Feb 25 came 2 days early on Feb 23. The PM stocks 8 day low was due Monday and we had a slight bounce and then sold off into Thursday and then bounced into Friday where the 8 day cycle top is due. E-wave wise, I believe we are in either wave 5 or wave 'c' of "c" of an a-b-c decline in the stock market off the Jan 6th top. This current a-b-c decline is the second in a series off the Oct 14th top near SPX 1044 known in e-wave terminology as a "double three". It is part of a bigger B Wave downward slanted bear flag that should terminate around March 17th in the SPX 870 area. In e-wave terminology, I label bear flags 'w' up, 'x' down and 'y' up. Bull flags would be 'x' down, 'y' up and 'z' down. R.N Elliott originally just labeled these a-b-c. If so, we are finishing wave "b" of B with "c" of B into the expected March top. Wave "b" or "x" is what is known as a "double three", that is two sets of a-b-c declines. The current expectation is that wave "b' or "x" will terminate Tuesday near 660 SPX. That is 10.2% lower than where it finished Friday. Then I would expect a bounce -wave 'a'- into the next 4/8 day cycle top due Wednesday or Thursday and then down into March 6-9 to finish an irregular 'b' wave bottom near SPX 650 and then 'c' up to the 870 area by March 16/17 to finish "y"of B. March 9th is where the original 8 day cycle should have bottomed. If Tuesday is the bottom, the next 4 day cycle low would be due either Friday or Monday. Astro speaking, the full moon of March 11 is close to the one that happened in September 2009. If we look at precious metals in this light, silver should bottom near SLV 9.83 on March 6-9 [where there is a nice bisection of rising and falling trend lines at that price]. GDX has an 8 day cycle low due March 5th +/- 2 days. It has a low due Tuesday according to the rising tops and bottoms bisection of the declining wedge it has just come out of. I suspect we see the best buying opportunity for GDX on Monday March 9th, but we will cover our shorts if Tuesday drops far enough to satisfy my down side objectives. Gold should make its bottom near 871 GLD (POG $886/887) on Tuesday and then rally probably out of fear. It is not unusual for silver to bottom 4 days later than gold as it did in October 2008. The bottom line: we are looking for a horrendous down day in the market Monday with a follow through bottom Tuesday. A rebound rally should fail either Wednesday or Thursday and make a lower low around March 6-9. This should be true for both the SM and PM stocks. Gold should make its bottom Tuesday and then rally. Silver should bottom with the stock market around March 6-9 A top is due around March 17th for the stock market and March 18th for the PM stocks. Both the SM and PM stocks will stage a huge rally into OPEX week that will complete Wave B off the October 2007 top (Wave A finished as a "double three" on October 10th). From mid March into about April 23rd, Wave C will take the SPX from about 870 to 550, a huge 36.8% decline. April should set us up for a huge rally into May 2010 that will take the SPX from 550 to about 1600 in 13 months time. Precious metals [especially silver] could form a W bottom with the late October bottom under $9 an ounce. Gold may do the same under $700 an ounce. Gold looks to test the March 2008 top near $1032 in mid March. I'm not sure if GDX will make a new, W, or higher bottom in April.

Wait a second, you are saying that starting in April we will start a massive bull run that in one year will return all the market's losses? Wow....uhm...why?

Blu....You always go wildly wild in your up and down projections. I can see 550 to 950SPX. Ok a doublin' but the bull hi of 1600? Ok....never say never in this Biz!

it is TOTALLY bizarre. but that way he can come back and say he was right no matter what happens, LOL. sadly, there are enough folks out there who fall for this. he even had one of his handles try to push his service on me. no, i don't think so ... NOT! rubbish!

it is TOTALLY bizarre. but that way he can come back and say he was right no matter what happens, LOL. sadly, there are enough folks out there who fall for this. he even had one of his handles try to push his service on me.

no, i don't think so ... NOT!

rubbish!

This guy is a nut case.

Wait a second, you are saying that starting in April we will start a massive bull run that in one year will return all the market's losses?


Wow....uhm...why?

Fundamentally all the massive money the FED is printing will flow back into stocks. Chart wise, snap back rally wave 'c' of an a-b-c, inverted B wave flat rally off the 2002 lows. We are approaching b of B

Wait a second, you are saying that starting in April we will start a massive bull run that in one year will return all the market's losses?


Wow....uhm...why?

Fundamentally all the massive money the FED is printing will flow back into stocks. Chart wise, snap back rally wave 'c' of an a-b-c, inverted B wave flat rally off the 2002 lows. We are approaching b of B

Blu....."All the money", not wellfare families, jobless and lower class people gettin free money for basics,bread and food. Middle class will save and pay off credit cards and put six months of nut in their rainy day accts. 'cause they fear being laid off. GIVE it to you and me(others on ff) and we'll Buy stocks, invest and hire!!

I see everything as Opportunity, whether we go up or down.

Edited by mogreen, 01 March 2009 - 08:16 AM.

Wait a second, you are saying that starting in April we will start a massive bull run that in one year will return all the market's losses?


Wow....uhm...why?

Fundamentally all the massive money the FED is printing will flow back into stocks. Chart wise, snap back rally wave 'c' of an a-b-c, inverted B wave flat rally off the 2002 lows. We are approaching b of B

Also, a Benner's cycle top due in 2010

Wait a second, you are saying that starting in April we will start a massive bull run that in one year will return all the market's losses?


Wow....uhm...why?

Fundamentally all the massive money the FED is printing will flow back into stocks. Chart wise, snap back rally wave 'c' of an a-b-c, inverted B wave flat rally off the 2002 lows. We are approaching b of B

Also, a Benner's cycle top due in 2010

Blu, I am showing a possible high for about March 17 for the markets which is in agreement with your stuff. I have a chart showing it on my blog. However 870 seems like a stretch in this market environment.

Edited by Russ, 03 March 2009 - 08:48 PM.