Posted on 10/13/2009 1:48:03 PM PDT by blam
Stock Market Bull Trap Heading For A 50% Crash To 5,000
Stock-Markets / Financial Crash
Oct 13, 2009 - 11:00 AM
By: Captain_Hook
At the risk of getting ahead of myself prior to being able to confirm the turn, I am suggesting stock market action over the past week bears the distinct odor of a bull trap, with even informed technicians still waiting for a push to 50% retracements on the indexes. In this respect then, you should realize the context of such a bull trap would be profound in that we are talking about the March lows being tested and violated, meaning for example the S&P 500 (SPX) could be on its way down to test its namesake at 500 before this next sequence is all over. You will remember from previous discussions, and in framing context correctly here, it’s possible we could be looking at a Supercycle Degree Affair lower in global stock markets directly ahead, implying 500 on the SPX would be an optimistic target for a low.
It will be important to watch what happens after quarter-end Wednesday, because if the funds cannot jam stocks higher for a window dressing related payday, we will have a good indication that at least the intermediate term direction has turned for stocks, where we will be looking to confirm this with the penetration of key supports in stock indices that will be discussed below. Further to this, and to continue framing what the future could hold correctly, I bring to your attention the latest undertakings from two market observers that appear timely in this regard, both sticking to their guns as deflationists moving forward from here. The first is from Doug Noland discussing Jim Grant’s recent defection from the bear / deflationist camp. And the second is from Mish, who amongst other things also touches on Jim Grant’s change of heart, characterizing it as a contrary indicator.
If you know me, it should come as no surprise I could not agree more in this regard. What’s more, and as discussed at length previously in the full body of my work, although I am not a deflationist, or any variety of permanent ‘flationist’ for that matter, based on the evidence before us today I do think the ‘deflationists’ finally have it right. Moreover, and to continue drawing on the compelling case in this regard, one should take a few minutes to view this video by Steve Keen, the link for which I am also borrowing from Mish, who appears to have is ducks in the appropriate row as well. Here, Steve correctly points out that collectively the global population is past ‘peak debt’, and that although private debt and credit creation do not play into some people’s definitions of money supply, anyway one wishes to count it, when we are contracting in this regard so will the economy at large, government stimulus or not.
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Hmm and I thought they would hold it off until after Christmas...
All the talk that the recession is over is hyping it. Reality is going to smash some people in the face and give them a bad hangover.
I think we will pull back significantly, but I don’t buy into you can predict the future by some shape of a chart.
I WILL MOVE IT OUT OF MY EQUITIES INTO A MONEY MARKET!
Got devestated on the last go around...one small IRA I had in essentially the MOst conservative fund....nothing happened.
Would not surprise me. The only way companies have made any money is book cooking, laying off, and cutting back. I see no big demand out there. Obama is so depressing who would want to expand or start up in this anti-biz environment. Disgusting. The only silver lining is that Obama and friends now own it.
The “stock market” could well party on for a long time. Most brokers aren’t middle class Republicans, they are filthy rich Rats. Bummer and his friends has steered enough emoluments to Rats to keep that market going quite a while.
Inflation helps make the market look prettier too, because those dollars are worth less and so the prices adjust to reflect that.
has steered => have steered. sorry
my financial advisor said to get out of everything that is paper related. Go gold and precious metals - tangible goods. No paper whatsover. T-bills a possibility but not for long haul.
how about toilet paper?
LoL! The stock market long ago ceased being an investment in openly traded companies, now it is a slot machine managed by pimply faced graduates of ivy league universities, overseen by one world narcissists that can throw billions around without losing a dime. Play at your own risk.....
What? The jobless recovery isn’t sustainable?
Yeah. Time will tell.
The only time when a stock is related to the worth of a company is when the company issues them, or the infrequent occasion that the company (or somebody purchasing the company) buys them back. Otherwise it’s like betting on Vegas.
I would be curious to know if the doomsayers actually invest the strategies they write. Am I to take it this author is short selling big time? Or is he just writing about it?
What effect would another stock market crash have on real estate?
I have heard this also...and precious metals will ride out inflation.
Because of the wide spread uncertainty and anxiety, even IF the companies in the market stocks were “OK” , the market will tank becuase of the fear...and if it all goes south as the survivalists predict...then the ONLY thing worth anything will be the tangibles.
are you ‘investing” in gold and precious metals “how”? Are you actually buying the metals? Or going to “Gold Investments?”...wouldn’t that be untrustworthy? I really get confused about that.
It seems more and more like that...but then how does Buffet do so well? It must be all insider info he has.
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