To: Crimson Ghost who wrote (56098 ) 12/5/1999 6:02:00 PM From: Gary Burton Read Replies (1) | Respond to
George--I would have responded to APH on the Kitco site but it takes a week to get a valid password--so I'll post it here instead--maybe you can copy it?--- I agree with his use of 1982 (rather than 1974) as the launch of this Great Bull Market--but I disagree with his count after 1982. In my view, Five Waves Up started with the 82 low but we did Waves 1,2 and 3 of this in a fairly short period of time of 5 years culminating at the 1987 top. Wave 4 was then either the crash low in 87 or an irregular ABC to the 1990 low (I favour the 87 low)...From there on,as I see it, we have been tracing out a long 5th Wave Extension during which the highest monthly peak RSI reading (as well as the a/d line)is actually LOWER than the peak in 1986/87! (thereby suggesting we are in a long 5th rather than still in 3, since 3 is usually the one with the strongest indicator readings)-----As I see it, from the 1987 low,this Fifth Wave Extension evolved as follows:- we ended subwave 1 at the 1990 top and subwave 2 at the 1990 Gulf War bottom (dn 22%) and subwave 3 at the July 1998 top, 8 years later, whereupon we again dropped 22% to 7400 for wave 4 and ever since then we have been in subwave 5 of such Fifth Wave Extension---Since subwave 1 of such Extension rose approx 86% (1616 to 3010), a common measurement for the peak of subwave 5 would be 7400 x 1.86=12,760. This also channels properly if one draws a straight line (on a log chart) connecting the the 1990 subwave 2 low with the 1998 subwave 4 low and then also draws another straight line parallel to it from the subwave 3 peak of 9371--ie subwave 5 would hit the top channel at approx 13,000 as i recall.----So, in a perfect world, one might expect the DJ to peak out near 13000 some time in 2000 a fibanacci 13 yrs from the 1987 crash low start--after which it should then embark on a substantial % correction, at least back down towards 7400-8000ish as APH suggests----bottom line-- I sincerely doubt that we are going to contain future dips to say 4-7%, let alone 10% and that after this current uptrend plays out, we will be at maximum risk for a breathtaking decline that will finally get the New Era folks back to reality (they always call it a New Era in a bubble!--and it IS a bubble, fostered in part by Greenspan's fear of reining it in and his strategy of allowing a heady money supply growth....In fact, I think Greenspan will ultimatly go down in the books as the one who let the markets get out of control and thereby cause major grief to a large % of the population that have now been lured into equities. We have now reached the point that the world, let alone the U.S. cannot AFFORD to have the U.S. stock market falter-which it will- becuase too many people are in it with a much too high financial exposure--Personally, I lay the blame for this at Greenspan's doorstep and sense that his legacy will not be kind when all is said and done. We shall see.
