Fiends In Stocks

[DeepBlue1]

I like Art too. In fact it's his observations on what a "normal" capitulation selloff looks like and is exactly what I've been waiting to see but it may or may not play out exactly like that this time. This is such a unique situation.

Like MANY OTHERS, I was pretty sure it was going to happen this morning, and IT MAY YET HAPPEN today nearer the close or even next week.

Santelli said something this morning that sounded really bad. Namely, that the "funny money" style of the market started just after 9/11, and I took that to mean that the unwinding of all this leverage will have to return to those "truly normal" levels before there's any chance of beginning to rebuild the "true growth" in this market.

I don't know if I'm getting psychic about all this or really beginning to understand the macro factors involved here, but it was much earlier this morning as I was listening and watching the overseas markets that the very same thought occured to me as well.

I then thought that if you take the levels of the market(s) back at pre-911 and then extrapolate a "normal" growth curve up through today's market you'd end up with a pretty good idea of where "true fair value" might reside.

Now if you look at the chart below you'll see that we're already below that level! This is very encouraging!

ALSO...notice that we're approaching the 7500 level FOR THE THIRD TIME. This leads me to the following conclusions...

With all that's been done by the Fed and worldwide, that's about to come online, we may well be testing the 7500 level withing hours or days and it'll hold.(These things will begin to come online in a big way over the next 2 weeks!)

So I can now imagine a HEAD AND SHOULDERS formation with 7500 being the neckline/support, and then a right shoulder forming that will, depending on what fundamentals are in place at the time, will either peak below/even with/or above the left shoulder's peak. This takes us back up a nice amount no matter what happens.

Conclusions: We'll retest 7500 or there abouts. If it holds(and I think it probably will), look for the pattern I just mentioned with a VERY NICE extended rebound in stocks with resistance levels around 10,000/then 12,000/and finally 14,000.

Art's been quoted saying that Monday is the 28TH day of the seventh lunar cycle??? and that that'll be the capitulation bottom. GET READY STARBOY! LOL











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