Ok lets continue the thread...

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BIGBLOCK

A broad look of the tecnicals as well as fundamentals shows no bottom for this bear market.
NO higher high or higher lows have been achieved, and none of the retracement carried any kind of exciting attention. Those retracements which a like to call up retracement since we are in a well established down trend, are part to the trend as fluctuations must occur.
This last rally may have still a little way to go, but nothing to worry about.
IN looking at the current chart of the DOW

It seems that the 10,700 level is just around the corner.  In fact much longer time frames show that the 7,500 level is not out of the question.
In a 60 day time frame the Stochastic shows just halfway through the correction, which indicate a possible target of 8400 before an oversold level is achieved.  Certainly if we reach those levels you are going to see some real panic and the posibility of further decline.
Realize, and I will say this again, that no changes has been made to the fundamentals.  The banking system is in trouble, and there is no easy fix on that.  But of course that is not the only thing pulling this markets.
One important issue that I believe is being overlooked  by the markets is the Russia situation.  Too much distraction wth the olimpic games, end of summer, and the mess with Fannie and Freddie.  Even the Oil futures fail to react due to the fact that South Ossetia is not sitting over any pool of Oil.  
The markets have focus more on the inevitable bailout of FRe and FAnn, and not enough on the repercutions that this Russia situation may have on future relations with Europe, and more specificly on how to establish a connection to Vladimir again.
Remember what happen in 1991 with Gorbachev, after the treasure mess and the hurricane mess.  All was recover except for Gorbachev.
This is opening a major hole in relations between east and west, and that will affect not just the economic health of Europe, but also the major foreign policies of global powers as well as global markets.
Russia was out of everyones mind, and now in just 2 weeks things have changed quickily.  This is already affecting conditions in Iraq, and Alghanistant, as well as the presidency campaign.  This is as of now a third front in our foreign policy.
This will not be ignored by the markets in times to come as this will impact emerging, debt, currency, commodities markets and any other market you can think of.
The circustances are clearly on the table, and I personally think they are not going to go away.  Russia knows well what is at stake, and they have been quite too much too long. 
How Russia play its hand will play a critical factor for all affected parties - Energy as well as oil could be a real threat to Western Europe already swamp with rampant inflation.
No matter what  - When markets have ignored circustances like those with Russia in the past, at the end the reality hits like a brick on the face - an ugly scene.
This will come into play later as a negative to US markets added of course to the ongoin mess already in place. 

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BIGBLOCK

Berkshire Hathaway will not bet agains the dollar, and Warren Buffet said clearly today that the economy will not rebound before 2009.  I think more like 2010.
Anyways he saids that the credit crunch among other things will continue to worsen. and furthermore noted that the FED Bernake has no "magic wand" to change give the economy a boost or lower inflation.
And to end he alleged that the nation could be facing economic disaster if it doesn't ge a handle on its growing debt.

I think there is still a little more room for shorts.

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ALLENBARY

If I remember correctly this bear market rally started with hedge funds covering naked shorts to meet the new requirements from the feds.  Nothing has changed that started the bear growling. Housing market and financials are still in bad shape, and getting worse. I see a greater potential for downside than up. So I will stay focused in short selling for now.  AB      

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BIGBLOCK

Yes Allenbary you are correct.  In fact,  Warren Buffet just yesterday said that wallstreet has been like a nudist beach, and that when you go swimming naked and the tight comes down you can alway see who hasn't been covered.  They are all trying to get covered now, and they are burning so much cash to cover payouts, that soon they are going to be in ruins.  But is a little too late, now they have been exposed.
Staying on the short side will definately increase your odds of making profits dramatically.  It makes no sense to want to go long against a well established downtrend of the general markets.

Take care.

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BIGBLOCK

Well even the FED agrees now - at their retreat at Jackson Hole the "economists" gathering say that there is no quick fix and that the economy has a long "long" way to go before recovery.
Did they really have to go to Jacksong Hole to come up with such lame statement.

The funny thing is that Feldstains say they have no clue where the lift is going to come from.
I surely agree with them that US will go into a recession  lasting as any post war history, which on the average has been 16 moths (remember mid 1970's, and early 1980's).
The thing to consider is how bad things are already, and with 16 month to go - those are going to be a long long 16 months for lots of folks.'

Cosumers are already getting toasted, and so will corporate soon after they run out of cash (business sector will roast), and so world growth will start to limp soon after.  
Then gravity will exercise its power and a new economy will surge.

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SHARPOLLY
 Fridays rally was a bit weak, IMO, I have to say.  Recent rally trendline was punctured and 50EMA held on friday.  I think a monday pullback will start another leg down.  I see the bottom being 9600-9800, not including the final scare- the- crap- out- us -blowout -bottom where the big dogs generally cover thier shorts and go long.


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BIGBLOCK

This coming week keep your eyes on the financials, and housing data.  Freddie and Fannie will probably be arranged, and of course Lehman Bros are still in the air. Good thing the market is still out on vacation.
When it returns there is going to be a lot of hair pulling.

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SCOTTNLENA

Time and paitence.  I've got both.
Man.. people a cooking now.  I have a neighbor that is an "investor"... they don't do anything crazy or foolish like trying to time the market, or move to cash, or look at emerging new sectors.  They trust their advisor who has been calling them this past several months to let them know "he's picking up some great bargains" for them.

boggles my mind how people can swallow that hook line and sinker.

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BIGBLOCK

Great business for the advisor.  About the bargains that is to be seen.
Ask them if the advisor offers them any guaranties.

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BIGBLOCK
Russias decisions today, are just pay back for US support to Kosovo.
The Geopolitical landscape has been changed as a consequense.  This will have repecusions (well it is already having)at a global level, and on global markets. 

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NOW WE CAN CONTINUE THE THREAD. 

Imo the looming Hurricane in the gulf will likely drive up oil prices next week adding weakness to a poor economy should make for good shorting opportunities in the oil and gas sector. AB  

I agree, to this date this is a well established downtrend.  There will be fluctuations as always, but again the primary downtrend is still down.  
As soon as I get a chance I will bring up illustrations base on Elliot which support the especulation that this is just the beginning of much longer downtrend.

Also keep in mind that strength on the dollar at this time is a negative of our economy as it will shut down exports.  Buffet just said he surelly will not bet against it.

It is unveliabable that the govenment tells us that GDP was up over 3% last quarter.  Come on folks!  What kind of magic is that?  black magic?
Today was announced the collapse of the 10th bank (Georgias's Integrity bank) taken by the FDIC.
Sarcastic ah!  INTEGRITY bank.
On the same pace, GM is now requesting bailout from the government.  They say they deserve it.
So Fanny, and Freddy on their knees, GM begging, housing in a slump, inflation eating us alive, Deficit never worse, personal debt out of control, healthcare in crisis, and consumer confidense down in the curve, unemployment up and up, and .... I could go on all night.
How did this magic GDP happened?
Maaay yy be is the goldylocks economy back on track! Just kidding folks.
but surely this must be a mistake or a bad taste joke.

The first 5 wave of an Elliot analysis.  The new wave 1 should complete another cycle, which in turn will become to be wave 3 of a larger cycle of waves. Well I am sure you know Elliot.  If not please google "Elliot Wave".

Like I said originally, I wouldn't rule out the 8500 level.  Don't worry it will not come tomorrow, but through the proper cycles and if left to work by itself we may very well get there.
I initially targeted wave to the 9500 level, but it didn't take it that low.  None the less this last 1 wave is longer than the original 1 as it is suppose to be.

Lucero interesting remark.  I am think the possibility of 3600 on the dow is more than doubtfull, but you know there is always a slight possibility.  I speculate that a level of 7500 is a much stronger possibility, althought once we are at those levels who knows what may happen.  I think that is the current economic conditions would had be present in the last bear the outcome would had been substantially lower

Bigblock ...

I find your chart note "major support from one the greatest bear markets" interesting ...

How do you quantify that ?

Percent decline from peak to trough ?

Time to recover to old highs ?

Big Block,

How can I get a copy of the template you use for the Dow?

Thanks,

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