Global Stock Market Crash Extended Leg Lower
Stock-Markets / Financial Crash Nov 16, 2008 - 02:18 PMBy: Eric_Chevrette
As it was said in a previous article (see “Imminent global stock market crash” from Nov 12), “ we're now just days away from a severe global crashing impulse…… the current study is not prejudging any further extension that may arise in the future course of violet wave iii ”.
Chart #1
Alas, chart #1 does nothing but confirm the outbreak of a SIMULTANEOUS extension ( violet wave iii extending as black i/ii/iii/iv/v ) for BOTH ADR and the US $ within the current crashing leg from brown point P2 (please refer to “Global stocks: what happens next?” for more detailed explanations about brown P2 ). According to the basic “no overlap” rule, we should now expect a swift impulse to the downside to materialize next week for ADR (while the US $ would reach clear new highs thru its mirror EW path in the same time window ). Of course, this “next week” assumption is not prejudging the still possible case when ANOTHER extension would appear within the course of black wave iii , which would somewhat postpone the ultimate materialization of the swift thrust at the heart of the entire impulse leg for both ADR and the US $ .
So far, prejudging the size of the entire ADR crashing impulse from brown point P2 does seem to confirm our assumption that “the worst is yet to come with global stocks” (see previous articles with “Time to think of the unthinkable?” from Oct 24 and later articles); indeed the 6 trading days from brown P2 have gone 120 points down from 660 to 540 for ADR while the previous 6 initial trading days in late September went just 100 points from 810 to 710.
As to the “reasons” for that imminent downleg, it might come out to be the hard fact that the G20 meeting did bring NOTHING over the weekend to truly fight or resolve the worst world crisis ever since WWII , except for a terribly high though unnecessary load of carbon dioxide pollution (these people flew to Washington and will now fly back home). As any astute observer of “human nature” would say, “there's a low chance that human beings caught in a downward spiral of problems could ever unite, unless all of them would feel the bleeding pain of the knife on their throat”.
Current times seem not to be ripe for that common “point of recognition” about pain. As a matter of fact, the TRUE “pain in the neck” won't really feel more real than until around 2022 when the crisis goes on hitting the lower part of its wave C leg (see chart #10 in “What happens next” from Nov 8). Moreover, the fact that the global stock markets seem to be jolting back and forth along a common though volatile “bottom line” over the last 6 weeks has certainly contributed to lower dramatically the “sense of urgency” among the G20 participants. Unfortunately, the only question left since more than a week is whether the new lows would be acquired before the G20 meeting or not. The answer to that question does now seem to get ultimately written on the back of the G20 participants. Alas, the light-heartedness with which they take the current situation will most likely never go down into history.
By Eric F.M. Chevrette
France
eric_chevrette@yahoo.fr
Fone: 00.237.9.660.53.59
© 2008 Eric F.M. Chevrette
Eric Chevrette translated Bob Prechter's “Elliott Wave Principle” in 1989 after graduating in 1984 from the ESCP (Ecole Supérieure de Commerce de Paris, see http://www.escp-eap.net ) which has been ranked 6 best business school in Europe by the Financial Times in 2006. He since has become interested in “market forecasting” and “global economical analysis” since 1987 and is currently helping people to protect and grow their assets while anticipating the big trends.
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