Stocks, Gold, and the 10 Year Kress Cycle Peak

Commodity News Center ^ | 9/11/09 | Clif Droke

[h20skier66]

Talk is now circulating in financial quarters of a new "mini-bubble" in the making. Apparently the unbounded rise in the stock market is reviving fears of another collapse like the one suffered last year.

Another reason that the "hated rally" has sparked fears is that we're about a year removed from the final "hard down" phase of last year's 6-year cycle collapse. September 2008 witnessed the financial markets crater and the intensity of last year's fear was unmatched in our lifetime. Not even the 1972-74 bear market, which was the worst since the Great Depression, witnessed a comparable level of fear.

W.D. Gann used to emphasize the importance of anniversary dates when it came to financial market analysis. The 1-year anniversary of an important market event is by far the most pivotal such date since the collective memory of the investing public is rather limited. Most market participants can still vividly recall the "great unwinding" of September-November last year. The vividness of that primal fear is still strong, hence the reason for the widespread expectation of another crash.

What most investors don't realize is that the cyclical forces responsible for last year's debacle are the complete opposite of this year's. Instead of a bottoming 6-year cycle, the new 6-year cycle that began last fall is up and supportive of the broad market. Even more poignant is the fact that the 10-year cycle is currently in its final "hard up" ascending phase. More than any other factor, this is the reason behind the strong recovery rally of recent months.

[GnL]

the 10-year cycle is currently in its final "hard up" ascending phase

What does Bill Clinton have to do with this story?

[hoosier hick]

So looking at market charts is all anyone needs to do? Current business/political situations have nothing to do with anything?

hh

[mad_as_he$$]

Any idea of the author’s track record?

[RobRoy]

I remember when Reagan was elected my brother told me that every president elected in a year ending with “0” died in office. Except Reagan didn’t, nor did bush.

I’ve also seen a roulette wheel hit red 20 times in a row and the same number three times in a row.

Predicting these cycles can be an exercise in false correlations. This guy may be right, but I doubt it. I’m sure JasonC would agree with him.

Fact is, we are in a perfect storm that has been in the making, literally, since the great depression. A LOT of chickens are finally coming home to roost. This is not “just another cycle”.