crusty, fwiw I too have a lot of time for BB.
Additionally I have the SPX and the DOW in the 5 of 5 of a 1 of C. The 3 of C DOW wave down will likely be a 5000 point decline or so, from the peak of the 2nd. It will be killer, especially the last portion. People will think it has ended after the iii, but will be slammed by a huge v shortly thereafter.
I've pushed my current timeframe for the beginning of the next major down out beyond my original estimates, made several months ago. Will just have to see how the corrective 2nd goes, but late 2nd qtr next yr would be a good estimate.
Of prime interest to me at the moment is the count on the 30 yr treasury rates (as well as the 10 and 5 yr). Although the momentum indicators on all decisionpoint treasuries have turned up, I tend to think the 30 yr rate is in a 4th of 5 and has one more little spurt down, before putting on a good correction. The momentum indicators often cross over in the 4th, only to reverse for a breif period thereafter, before turning up again. If this is correct for bonds, they should begin a large correction within a month or so, if they haven't already.
It is very interesting that decision momentum indicators on the XAU crossed up, last Nov, about one week after the 30 yr rate momenetum indicators did the same.
Looking forward I think a similar scenario may be in the making this year. Looking forward even further, if the DOW and SPX both put in a huge 3rd wave down, and start sometime next yr (as per EW they must), this 3rd will be accompanied by a large fall in the dollar. This in turn, since it will be accompanied by a large USD drop, will drive gold to the levels we've all been talking about.
Prechter was right in that this last huge up we had in the PM indices was a corrective. I don't know what he thinks the next will be - but I'm thinking it will be the true impulse we've been looking for.
Here are the 30 yr treas rate weeklies.
stockcharts.com[l,a]waclyiay[df][pb50!b200][vc60][iUb12!Li14,3]&pref=G
FWIW that is how I see it and is how I'm playing it as of now. Everyone should stay on the right side of the trend, or they will be squashed, and if it works out the way outlined, shorts and puts will be the order of the day, sometime next year. Unlike what most of us have not done this last wave however, the thing to do will be to hang on to them, for a long long ride down. We're not used to this, hence the tendency has been for most IT players to cover to early.
Other interesting tidbits from decisionpoint data that I offer:
Rydex PM asset levels have recently been halved. The momentum indicators on the CEF and RYPMX funds are both down, indicating more down should yet occur.
XAU momentum indicator is heavily down. I mention these repeatedly as decisionpoint momentum indicators are decent at predicting reversals. Not quite yet for the XAU according to dp.
Rydex Bear/Bull bond ratio bollinger bands tightening up, indicating a change is coming. Looks like a peak in the ratio may have been put in, or is very close.
Rydex US Govt Bond Fund (RYGBX) momentum indicator just crossed down. Fund asset levels very high.
Rydex Juno Bond Fund (RYJUX) momentum indicator just crossed up. Asset levels are high and rising in a steady trend. Some folks are apparently betting decent sums of money that interest rates are gonna correct hard, soon. Just like the COMS shorting gold.
Rydex Bear Fund asset levels at an unbelievable level. May have peaked.
FWIW, just a synopsis of some stuff I'm presently watching. A key month coming up, starting about now imo. Looking forward some decent setups seem to be in the making.
A slightly dated decisionpoint freebie or two:
decisionpoint.com
This one is interesting. The pattern shown is somewhat typical in my opinion of the 3rd transcending to the 4th, something that has recently messed up many a waver (including this one).
decisionpoint.com
I've updated this verbally, but key info imo. |
