Sunday, August 03, 2014 7:39:56 PM
The Major Markets: Where they're headed from here!
The DJIA downside target: 3348
The bull market of 2009 will end this year in 2014.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=104930402
Calculating a Forecast for the Dow and S&P 500
Our wave count provides a fitting downside target.
In 1970, A.J. Frost projected a low for wave IV by multiplying the decline of 1966 by 1.618 and subtracting that length from the 1966 high, yielding a target of 572. That turned out to be the low in 1974.
Applying the same ratio to wave a in the Dow/PPI gives a target of 14.38. This level is an excellent target, because corrections usually carry into the range of the previous fourth wave of one lesser degree, which in this case is wave (IV), the 1929-1932 decline. The target falls well within this range.
A target for the nominal Dow is more difficult.
The previous fourth wave is still 1929-1932, and the peak of that range is 381. A worldwide debt collapse would make this target accessible. But there are no typical internal price relationships that would get the index to that area.
Applying the same targeting method to the nominal Dow as we have applied to the Dow/PPI gives a moderate downside target of 3348
As it happens, a 2.618 multiple of wave a subtracted from the current 2014 high projects nearly the same level: 3396
If wave b is over or nearly so, the confluence of these targets adds weight to their validity. We can tentatively identify the area of the 3300's as a minimum target, which might serve if a substantial amount of the dollar's inflation since 1913 somehow remains in the system through the bear market.
If the Dow/gold ratio and the Dow/PPI ratio reach their downside targets while the nominal Dow falls into the 3300's in a clear five waves, we might recognize a final bottom for wave c.
If these two real-value measures are not at their targets, then the 3300s will not mark the ultimate lowest point of wave IV. A low in the 3300s still might mark the end of wave c of (a), but in that case wave ( will probably not turn out be a triangle but a flat, with a lower low to come years later. Either way, wave (a) is going to be a whopping bear market.
What to Expect in Wave c
Wave c down is the next big event.
To anticipate the ultimate resolution of this ongoing bear market, read this description, from Elliott Wave Principle regarding what to expect in the final wave of decline:
Declining C waves are usually devastating in their destruction. They are third waves and have most of the properties of third waves. It is during these declines that there is virtually no place to hide except cash. The illusions held throughout waves A and B tend to evaporate, and fear takes over. C waves are persistent and broad.
Despite widespread belief that interest rates, the money supply and the economy are all under the Fed's firm control, the Fed can do nothing to stop the approaching crash.
Worldwide debt is on the verge of a swift, stunning, deflationary implosion. The models for the coming collapse are British stock prices in 1720-1722 and American stock prices in 1929-1932, except this one will be bigger and perhaps even faster. As at those times, the market should undergo a few years of persistent melt-down, and wave c will be done. Whenever we see evidence that wave c has started, we will revisit our timing forecast for the ultimate low.
http://www.elliottwave.com/grpcontent/Special-Report-1407THE.aspx
The DJIA downside target: 3348
The bull market of 2009 will end this year in 2014.
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=104930402
Calculating a Forecast for the Dow and S&P 500
Our wave count provides a fitting downside target.
In 1970, A.J. Frost projected a low for wave IV by multiplying the decline of 1966 by 1.618 and subtracting that length from the 1966 high, yielding a target of 572. That turned out to be the low in 1974.
Applying the same ratio to wave a in the Dow/PPI gives a target of 14.38. This level is an excellent target, because corrections usually carry into the range of the previous fourth wave of one lesser degree, which in this case is wave (IV), the 1929-1932 decline. The target falls well within this range.
A target for the nominal Dow is more difficult.
The previous fourth wave is still 1929-1932, and the peak of that range is 381. A worldwide debt collapse would make this target accessible. But there are no typical internal price relationships that would get the index to that area.
Applying the same targeting method to the nominal Dow as we have applied to the Dow/PPI gives a moderate downside target of 3348
As it happens, a 2.618 multiple of wave a subtracted from the current 2014 high projects nearly the same level: 3396
If wave b is over or nearly so, the confluence of these targets adds weight to their validity. We can tentatively identify the area of the 3300's as a minimum target, which might serve if a substantial amount of the dollar's inflation since 1913 somehow remains in the system through the bear market.
If the Dow/gold ratio and the Dow/PPI ratio reach their downside targets while the nominal Dow falls into the 3300's in a clear five waves, we might recognize a final bottom for wave c.
If these two real-value measures are not at their targets, then the 3300s will not mark the ultimate lowest point of wave IV. A low in the 3300s still might mark the end of wave c of (a), but in that case wave ( will probably not turn out be a triangle but a flat, with a lower low to come years later. Either way, wave (a) is going to be a whopping bear market.
What to Expect in Wave c
Wave c down is the next big event.
To anticipate the ultimate resolution of this ongoing bear market, read this description, from Elliott Wave Principle regarding what to expect in the final wave of decline:
Declining C waves are usually devastating in their destruction. They are third waves and have most of the properties of third waves. It is during these declines that there is virtually no place to hide except cash. The illusions held throughout waves A and B tend to evaporate, and fear takes over. C waves are persistent and broad.
Despite widespread belief that interest rates, the money supply and the economy are all under the Fed's firm control, the Fed can do nothing to stop the approaching crash.
Worldwide debt is on the verge of a swift, stunning, deflationary implosion. The models for the coming collapse are British stock prices in 1720-1722 and American stock prices in 1929-1932, except this one will be bigger and perhaps even faster. As at those times, the market should undergo a few years of persistent melt-down, and wave c will be done. Whenever we see evidence that wave c has started, we will revisit our timing forecast for the ultimate low.
http://www.elliottwave.com/grpcontent/Special-Report-1407THE.aspx
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