Best of the Week
Most Popular
1.Gold Price Target of USD 2,300 - GoldCore
2.Greece Banking System Collapse Monday as ECB Pulls the Plug, Capital Controls Ahead of GrExit - Nadeem_Walayat
3.Why British Muslims Are Leaving Elysium Paradise for Syrian Hell - Nadeem_Walayat
4.Greece BANKRUPT! Financial and Economic Collapse to Follow IMF Debt Default - Nadeem_Walayat
5.Extreme Gold/Silver Shorting - Zeal_LLC
6.European Empire Strikes Back Against Greek Debt Fantasy, Counting Down to GREXIT - Nadeem_Walayat
7.Gold And Silver – Three Choices: Sell, Hold, Hold and Add. A Trading Treatise - Michael_Noonan
8.Gold and Silver Price Headed for Breakdown - Jordan_Roy_Byrne
9.Greece Crisis OXI - Raul_I_Meijer
10.Flatline Investing and Dead End Debt Schemes - Doug_Wakefield
Last 5 days
Silver Tunnel Vision 'Experts' - 1st July 15
Gold And Silver - Monthly, Quarterly Ending Analysis - 1st July 15
Europe’s Controlled Demolition - 1st July 15
The End of Dow 18,000; Bailouts No Longer Extended  - 1st July 15
Athens Mayor: Greek Government Should Resign - 1st July 15
China Stocks - This Is What a Bubble Looks Like - 30th June 15
Stocks Plunge on Greece Euro-Zone Financial Armageddon Blackmail - 30th June 15
Greece Crisis Shows Importance of Gold as Europeans Buy Coins and Bars - 30th June 15
Stock Investors Express Route to Profits in the Healthcare Sector - 30th June 15
Beyond the Greek Impasse - 30th June 15
Gold GDXJ : Impulse Move Pending - 30th June 15
Fed Interest Rate Increase Could Be Best Thing to Happen to Gold - 30th June 15
Marc Faber - Greece is Basically Bankrupt - 30th June 15
Greece - Shoot the Dog and Sell the Farm - 29th June 15
Grexit?, BIS Warning, Chinese Market Crash & Systemic Risk Shake the Global Economy - 29th June 15
The New "Sharing Economy" May Not Be the Profit Bonanza Everyone's Expecting - 29th June 15
Gold and Silver Greece and Short Positions - 29th June 15
Volatility and Sleep-Walking Markets - 29th June 15
Greece BANKRUPT! Financial and Economic Collapse to Follow IMF Debt Default - 29th June 15
Stock Market More Decline Ahead? - 29th June 15
China Stock Market Crackup - The Final Trap Looms... - 29th June 15
Greece Banking System Collapse Monday as ECB Pulls the Plug, Capital Controls Ahead of GrExit - 28th June 15
Investor Stock Play for Two Growing Missile Threats - 28th June 15
Stock Market Uptrend/downtrend Inflection Point - 27th June 15
Greece Crisis OXI - 27th June 15
Gold And Silver – Three Choices: Sell, Hold, Hold and Add. A Trading Treatise - 27th June 15
It’s Time to Change the Way You Look at Disney Forever - 27th June 15
Flatline Investing and Dead End Debt Schemes - 27th June 15
Stock Market Investors Avoid the "Herd" Like the Plague - 26th June 15
Extreme Gold/Silver Shorting - 26th June 15
USD Daily, Weekly, Monthly & Conclusions - 26th June 15
Gold Price Target of USD 2,300 - 26th June 15
Gold and Silver - Another Successful Option Expiration For the Insiders - 26th June 15
Why Buffett Bet A Billion On Solar Energy - 26th June 15

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

China Stocks - Where are they going?

Stock Market Dam is Ready to Burst

Stock-Markets / Stock Markets 2012 Dec 07, 2012 - 04:50 AM GMT

By: Anthony_Cherniawski

Stock-Markets

We finally caught the break we have been waiting for in the Euro. It broke its Bearish Wedge today, leaving no doubt of its destination. This is the first major “crack in the dam.” With the Euro uptrend broken, the rest of the markets will follow. Those who are long will be like the people living beneath the dam burst. They won’t even have time to make for higher ground.


There are several subscribers who are becoming impatient that nothing has yet happened. To them I simply say, “Stay on higher ground.” Please review the details from Edwards & Magee’s Technical Analysis of the Markets on the Orthodox Broadening Top. It is a very deceptive formation.

Here is an hourly view of what has transpired in the SPX so far. There is a less-than-50-50 chance that the SPX could be edged up higher (to 1418.91, the 50-day moving average) in the opening hour tomorrow. But neither the action so far nor the potential of a slightly higher open tomorrow changes the bearish outlook. This is the final and most dangerous stage of the Orthodox Broadening Top formation, equivalent to the dam burst mentioned earlier. Too many people will be looking for an exit and the doors will be blocked (due to a lack of buyers).

It would pay to read today’s ZeroHedge article on record margin debt. In addition, Net Free Credit has plunged -$44 billion in October. Investors are already invested beyond their capabilities to handle a downturn.

In summary, investors are swimming in debt and banks are becoming very concerned about extending credit any further.

Yesterday’s record sell-off in AAPL for no apparent reason should give one pause. Some of my Wall Street contacts have suggested that the Fed may have even stepped in today to prevent a rout in the market due to the AAPL sell-off, since Margin Calls would start on Friday. Whether the rumor is true or not, this is no place to “buy the dip.” NDX has been stopped at its 50-day moving average, its 50% retracement and its Broadening Wedge (slightly less bearish than the Orthodox Broadening Top). Although it made a slight gain today, the dip below the final support is a warning that the support may not hold the next time.

I did a triangulation of the different cycles in the Dow, the NDX and SPX. The ideal date for a cycle bottom now appears to be next Thursday, December 13. The fractal pattern starting at the high on Monday morning agrees with this analysis. Several of my compatriots also agree that December 13 may be a pivotal date for a significant low.

Be patient. The market does what it will in its own time. Fortunately, the Cycles Model appears to be making order out of what seems to be a disorderly market.

Regards,

Regards,

Tony

Our Investment Advisor Registration is on the Web

We are in the process of updating our website at www.thepracticalinvestor.com to have more information on our services. Log on and click on Advisor Registration to get more details.

If you are a client or wish to become one, please make an appointment to discuss our investment strategies by calling Connie or Tony at (517) 699-1554, ext 10 or 11. Or e-mail us at tpi@thepracticalinvestor.com .

Anthony M. Cherniawski, President and CIO http://www.thepracticalinvestor.com

As a State Registered Investment Advisor, The Practical Investor (TPI) manages private client investment portfolios using a proprietary investment strategy created by Chief Investment Officer Tony Cherniawski. Throughout 2000-01, when many investors felt the pain of double digit market losses, TPI successfully navigated the choppy investment waters, creating a profit for our private investment clients. With a focus on preserving assets and capitalizing on opportunities, TPI clients benefited greatly from the TPI strategies, allowing them to stay on track with their life goals

Disclaimer: The content in this article is written for educational and informational purposes only.  There is no offer or recommendation to buy or sell any security and no information contained here should be interpreted or construed as investment advice. Do you own due diligence as the information in this article is the opinion of Anthony M. Cherniawski and subject to change without notice.

Anthony M. Cherniawski Archive

© 2005-2015 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Biggest Debt Bomb in History