Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

The Timmay Wave

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The last time I discussed my analog, I believed a drop from "h" to "i" was going to take place. It hasn't; the market has just chugged higher. I still believe this one last drop for the bears in 2010 is in the cards, and I've updated my charts accordingly.

Below is the chart from the late 1930s; the aforementioned drop would be from "12" to "13" (which is the equivalent of "h" to "i" mentioned last time). After this drop, a hearty rally challenging the April 2010 highs should take place, and I plan to have a ton of precious metals and stocks at that time.

1017-past

Looking at the present chart, you can see that the range for (13) is massive, because – – – even though the form for the analog has been holding up exceedingly well, the terminus points have been either muted or exacerbated, distorting the form. So (13) could fall from anywhere down to about (10) to much farther, down below (11). As manipulated as this market is, I'm leaning toward a more modest fall.

1017-present

Once this fall is complete, I plan to load up and be out of shorts almost entirely, if not completely. There is some kind of "shock event" for next spring (or thereabouts) that will change everything, but I want to ride things up until then. I imagine Bernanke's shenanigans will finally come home to roost, and the U.S. is going to be up the creek without a paddle.

I have finally set aside the Elliott Wave entirely as a predictive tool. Indeed, I would say that nothing has been more destructive to my own financial prosperity over my lifetime than the attention I have paid to this method. I know there are other prognosticators besides EWI, but I find them all collectively to be just noise.

I have taken readers' advice and am going to be following my own analysis. Because you know what? There is no wave 3. Or wave X. Or anything else like that.

It's a fun parlor game to put labels on "waves" after the fact, but for predictive value?……..I'm done with it. It doesn't work.

The Experts

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At the risk of seeming obsessed, I've got to vent a bit more about a certain well-known organization that makes a lot of money selling financial publications.

I used to run their ads here, but I decided a while ago I could not in good conscience run those ads anymore since the opinions emanating from the aforementioned house seemed – to put it kindly – unhelpful.

I happened to run across one of their missives from 14 months ago. It was stating that precious metals were about to plunge hard, and this sentiment has been repeated pretty much constantly ever since. Here's a quote from the August 2009 publication and a graph of the gold spot price to put things in context.

1013-gold

At the beginning of this year, there was a prominent headline in boldface type in the January issue of one of their principal publications. It was as follows, and a quote of the financial-based ETF symbol IYF is shown with it.

1013-runaway

My point in this isn't to diss a firm that has made (countless) bad calls. Lord knows I've been off the mark a lot this year. My points are twofold: (a) I respect an organization or a person a lot more if they will, at least occasionally, prominently state how they have screwed up royally; (b) please don't put a lot of stock in "experts", no matter how popular or well-read they are.

After all, if a firm makes 500 predictions, and one of them comes true, you can milk that one good prediction in your advertisements for years to come. You don't have to tout the 499 misses that were printed alongside the one exception.

Slopers are collectively a trustworthy bunch. Learn from them. But as for the rest of the world – – – take it with a grain of salt.

The Elliott View (by PUG)

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OK Bulls and Bears, we are at a very critical juncture here.  Taking a look at the SP-500 Weekly Chart with linear price scaling, you can see that the current price (1160) is right at the down sloping trend-line (red) that connects the Oct 2007 high (1575) with the Apr 2010 high (1220).  Price has also been bouncing off the up sloping trend-line (black) from the March 2009 low of 667.  Notice the “Diamond” Pattern that has formed over the past year from Oct 2009 to Oct 2010.  This type of Diamond Pattern in this position can form at “Half-Staff” or be a “Topping” pattern.  If its at half-staff, then we can expect another move out of diamond pattern of equal magnitude to the incoming move.  The incoming move was 1220-667 = 553.  So we can expect a measured move from 1011 + 553 = 1564, which takes the SP-500 back to it’s Oct 2007 high.
 
For the my primary count to be correct, the SP-500 needs to break through this down sloping (red) trend-line and move towards a new high above 1220 by end of 2010 in major degree wave [1]-P3.  From there, the SP-500 will be free to melt up in 5-waves of major degree within Primary Wave 3 (P3) to the old October 2007 high of 1575 over the next two years (see the green path on the weekly chart).
 
If however, the SP-500 fails to push through the down sloping (red) trend-line in the next few weeks to a month.  Then there is a good possibility that Primary Wave 2 (P2) will need to make a deeper correction below 1011.  In this case the move from 1220 to 1011 was only major degree [A]-P2 and the subsequent move from 1011 to 1163 was wave [B]-P2.  The next move will be a [C]-P2 drop to 954 (if [C]=[A]=209 points) over the next 2 to 3 months.  This 954 level would be a 50% retrace of P1 in price and time.  I’m calling this my alternate bearish view, in case the SP-500 fails to move higher that this 1163 to 1177 area in the next few weeks to month.  If the SP-500 falls to this 954 level for my alternate P2 low, then the P3 move to old high of 1575 will just be delayed by about 3 to 6 months in time (see the red path on the weekly chart).
 
SP-500 Weekly Chart (10-5-10):

1006-pug

Another Analog (by Nathaniel Goodwin)

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After reading some great posts on the thoughts of Serge and Pug Thursday, I thought I would throw this analog out there. This one has been in the back of my head for a few months, and is one reason I’ve tried to lighten up a bit on the bearish side. I am not trading off of this or any other analog, just keeping it in the back of my head along with all the others.
 
If this panned out, it would be  like a strung out version of the 1960’s. The pattern we are currently in could take a few years longer than it did in the 60’s. Elliott Wave wise; this is sort of like what I think Pug is projecting. ((We could also be in an X wave right now from the 666 low after a big A-B-C from 2000-2009, and possibly break the 2008 high to conclude the X wave. What could follow is another mess of A-B-C crash-rally-crash (or just painful sideways motion) that could last until 2020-2025)).

 

I believe that Prechter’s P3 then P4 and P5 is actually the quickest and easiest way this whole mess could end up in terms of EWT; unless the A-B-C from 2000-2009 ended the correction, and we are now in a new bull market. To be honest, I think there are better ways for me to spend my time honing my trading skills than worrying about EWT long term. No matter what happens, EWT will find a way to be correct in the end!


  SPX1960s
 
Here is a fun-fact, mom says I was actually conceived sometime in March of 1974, and was born on 10/04/1974, which was the day that awesome bear died.

One theory I have is that  I may need to impregnate a willing female sloper, which could possibly start the beginning of the next and final big sell off. When the slope-love-child is born, we should all probably dump our shorts and go very long for the remainder of our lives.

If any slope-babes between the age of 21 and 52 are interested in the creation of my spawn, please leave your contact information in the comments section below. This offer is also valid for Bloomberg’s Deidre Bolton and CNBC’s Amanda Drury.

Pug

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As many have gathered, I'm been kind of "down" on Elliott Wave lately (for reasons regular readers know all too well). One E-waver, though, seems to get consistent respect from Slopers, and that is Pug.

Here is his site, which appears to be partially free and partially fee-based. Now let me be clear that my general interpretation of the market's direction differs considerably from Pug's, although ultimately we are in total agreement (that is, the S&P getting somewhat below the February 2009 lows, but not by apocalyptic amounts). Here is his latest "big picture", which calls for a rise to new highs (gack!!) followed by a long fall.

There's been enough adulation about Pug in the comments section that I thought it was high time to point out this impressive site.

0916-pug