It is too early in the day to offer an “I told you so…” BUT I did and it’s not to early to remind you of our outlook for the markets to pick up speed to the downside in coming weeks.
The next “window” for major decline comes around November 27th. latest details for people in the $40/year seats over in our Peoplenomics.com report tomorrow.
As always, this is NOT FINANCIAL ADVICE and please, it is only a possibility, not even a probability. At least till it happens.
We based these dates on some historical relationships. Like the 55-day span from the all-time high in September of 1929 to the October Great Crash in that year.
Crashes are funny things (not as in ha-ha, but as in queer): They don’t seem to happen from tops. They tend to happen at “channel bottoms.” Like a roof caving in.
There are two channels that are in trouble between now and year-end. The first one, which could fail between now and, oh, next Tuesday, or so, is the lower blue one shown here.
There are all kinds of asterisks and footnotes attached to this view. Some of these include:
- I look at markets as an Aggregate since its too easy for “one index” to dominate on a particular “news flow”
- The blue ascending line is a trend line that began in early April.
- The red line is a simple 9-Day Moving Average (9DMA) and it won’t be until we get under the 9-Day that things will begin to get interesting.
- Did I mention, this is NOT financial advice?
The problem with being able to “See” bits and pieces of the future when in the waking state (or, over in the dream realms on occasion) is there’s a major burden that comes with “knowing” the future. For one, the future is never all that “solid” until it gets here – drifty space oftentimes.
But then again, it can be usefu0l to see things in advance.
When you’re looking at financial items, it’s best *(for me, anyway) to stick with the hard facts and projections on the waking side of life. Hunches are very easily and very often misleading.
With such a long mea culpa, I’m expecting that blue support trend line to fail today and we seem likely to decline from this morning’s open, perhaps again Monday and then into a “turnaround Tuesday.” Where’s the good news? We need to ask that every day.
The problem is that when one of these trend lines breaks, particularly when it counts as an Elliott Wave 2 top, then it sets up the Elliott Wave 3 down. Since under Elliott, the 3rd waves are larger than first waves, we should be at a MAJOR CHANNEL BOTTOM along around the end of the month. That’s why the nail biting around November 27th.
Which, if you’ve been paying attention, is where that lower trend channel is. It’s also when that S&P 2,500 level gets within spitting distance and THAT (for rounding) would be 12 percent lower than we are right now.
Again, asterisks – disclaimers – because we can be dead wrong. The market could just as easily go delusional and rally like hell and we could get new all time highs before Turkey comes out of the oven.
Unfortunately, the cards do not support the optimism going forward that we had prior to election day. The trends are turning.
- The mass shooting this week out in Thousand Oaks will have a chilling effect on holiday revelry. The efforts of MAD will, we think, in the public consciousness, be driven by such events and Florida shootings and what-not such that a long-term decline in going out and “clubbing” is locked into our future. My wife Elaine hates this. She was a ‘disco princess” back in wilder times. Now? Life “going out” just isn’t the same.
- Along with this, social media is changing, as well. There’s a new study out today showing that use of social media increases depression and feelings of loneliness.
- People are sick of politics. Despite this, Michelle Obama is being touted top of the fold on Drudge today. When followed, the link is to an AP story about (selling?) Michelle Obama’s new book. Yes, she’s positioning for 2020 and it’s looking more and more like the Obama’s are working to set up the first black American family political dynasty in the style of the Bush’s and the Kennedy’s.
- The Great Divide, though, has not only been driven by money (and the revenue implosion of the legacy media sources) but also by extremists. Down in Florida, a republican claims democrat election officials plotted to steal an election. Hardly any novelty to that, is there?
- Life in America still depends on your Zip Code, when comes down to it. That area of Florida is still a disaster zone from the hurricane a while back. And besides the shooting in Thousand Oaks, people in Ventura County California have to deal with a massive wild fire as reports came out about how “Santa Ana Winds Could Push Hill Fire All the Way to the Pacific Ocean, Ventura County Fire Official Says.”
The snooze media keep walking in the “same-old ruts.” Technology has opened up so many new ways to look at the world. We’re not using the resources we have.
News By Zip Code
20530-0001: US Dept. of Justice offices in D.C.
87545-136287545-1362: Los Alamos National Lab
20008: Chinese Embassy, Washington D.C.
20210: US Dept. of Labor
Press release on Producer Prices is just out:
“The Producer Price Index for final demand rose 0.6 percent in October, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices advanced 0.2 percent in September and declined 0.1 percent in August. (See table A.) On an unadjusted basis, the final demand index increased 2.9 percent for the 12 months ended in October.
In October, over 60 percent of the rise in final demand prices can be traced to a 0.7-percent advance in the index for final demand services. Prices for final demand goods moved up 0.6 percent.
The index for final demand less foods, energy, and trade services rose 0.2 percent in October after climbing 0.4 percent in September. For the 12 months ended in October, prices for final demand less foods, energy, and trade services advanced 2.8 percent.”
Yes, one could say this :”sux-a-bunch.”
Did I mention the Dow is likely to open down around 150?
No more “news by zip code” but, you get the point, I hope. If something is going on outside of Zip Codes you personally walk-around in, so what? Not there’s much you can do about it.
Unless you’re Rachel Maddow and want to organize a whole country to march in order to bolster ratings. Fine, we get that. (See yesterday’s comments on the monetization of personality in lieu of news reporting._)
Such protests are about the stupidest thing possible – unless it is (as we totally grok)_ a ratings play. Here are just a few reasons why its likely hype.:
- Trump can fire whoever he wants. He is what? The President! People serve at the President’s leisure.
- Trump is NOT going to re-hire Jeff Sessions, so what’s this march crap aimed at? Think maddow can “force feed Trump?” AYFKM?
- Congress is in lame duck – and they are out to lunch most of the time anyway…so again, what’s the point? Besides ratings, lol.
- And when the new clowns show up in January, what will be the point then? The House can impeach 10-days a week to no end since the GOP owns the Senate.
- Someone needs to think a little more and deeper…
I would like to believe these “street marches” are “spontaneous” and such. But when it becomes a “ratings tool” we wonder about the sincerity of the promoters.
No: We’ll stick to our guns on this: Division in America is an Economic Function. Maddow’s Marches are Monetization of her brand and her media.
Old-time capitalists (moi) look at the news a little differently. We look at the Maddow marches very suspiciously. After all, how did MSNBC do in their election coverage? Well, figures Ad Age in their TV Newser section, not bad! “Last night represented MSNBC’s highest-rated midterm election coverage ever during 8 p.m. – 11 p.m. ET in both A25-54 and total viewers..”
As we have suggested, economics is everything and if MSNBC can make headway with elections, gambling that millions putting on their Doctor Martens and hitting the streets (though to no particular point) would be a fine ratings hype.
Perhaps. But and howsome ever: We would love to live in a country where people are brighter than that and wouldn’t falal for such demagoguery, but this is a country of sheep…waiting to be sheered.
Maybe I’m just old and grouchy…or (and this is scary to consider) maybe we have a pretty good bead on things and the world really is verging on insane.
Tell me it ain’t so!
Moron the ‘morrow!