The problem is, of course, that if we drop another 100 DOW points, we will probably drop a thousand (Yes, 1,000!).
Why? Well first of all, the head and shoulders pattern has at least 500 hundred in it... and second of all, the panic which will come next will drop it at least another 500!
Remember, a lot of people bought into the crap (excuse the language) being handed out that October was the low and started buying... those people are going to get VERY nervous the lower we go! In addition, there is no hope at the end of the tunnel!!! None. Check out the numbers like industrial productivity, and you will find it flat in the low 70s for almost a year!!! You have to go back further than 17 years to find anything that bad... and it isn't changing! The consumer index, CMR, is down almost 20% from the peak back last winter. But Congress, in it's infinite wisdom, did not extend unemployment benefits which will knock another leg out from under this economy. And then there is the USD going lower and lower every hour, it seems!
So things are really dicey right now... and unless we have some really great news soon with a corresponding pop in the markets, I am afraid the worst is yet to come! |
