The Outlook

This Tuesday evening the analysts at DecisionPoint, my technical market studies provider, posted this comment:

Our primary short-term focus is on the rising trend line drawn from this month’s low. It is very steep and not likely to be maintained much longer. Overhead resistance is just inches away, and on the thumbnail chart we can see that a rising wedge has formed. The expected resolution of the wedge is downward:
spy WEDGE
The market reversed on Wednesday and has now fallen out of the wedge. Every indication I have tells me that the last attempt at new highs has failed. The bear market has most probably resumed. If the Wave Principle forecast is correct, the next wave down will be longer and more severe than the decline from Dec 31. The major market trading cycles, from seven years out to fifty years, are all joining in a hard down phase, scheduled to bottom around mid year 2016.

It stands to be a very difficult time for anyone owning investment assets of any kind. The only thing likely to hold value is cash.

The downturn will be driven by a steep decline in social mood. The artistic community is already sussing out the vibe. This is to be expected. Pericles, leading Athenian during its golden era, would complain bitterly that his advisors were clueless-that to find out what was going on he had to go down to the agora to hear the songwriters. So it’s no surprise that today our film makers are out in front of the rest of us with this soon to be released new offering:

The dialogue at the end of trailer is high melodrama:

Noah’s wife asks, “Is this the end of everything?” Noah, replies, “The beginning. The beginning of everything.”

It’s a good thought. When we get to the lows, with the Dow Jones Industrial Average well below 1,000, most will be seeing it as the end. Better to be prepared to see it as the beginning.

Cheers,

Rod

No one should consider any part of this presentation as a recommendation to buy or sell any securities whatsoever.

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