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Everything posted by ChrisN

  1. Well at least an honest and a detailed explanation of your thoughts and observations. IG must be/are the market leader in the UK. I say that because if your penchant is for small cap stocks then the first thing to realise is the sheer lack of volume/liquidity and hence the large spreads. Data will be sporadic because of that. Applies equally to AIM equities. Personally I try to steer clear of such markets but I wish you luck trying to find them within the SB arena.
  2. @Caseynotes Hah! You betcha bottom dollar fella! After Donald Trump became US President he went on a fact-finding visit to Israel. While he was on a tour of Jerusalem he suffered a heart attack and died. The undertaker told the American diplomats who were accompanying him, 'You can have him shipped home for $50,000, or you can bury him here in the Holy Land, for just $100. The American diplomats went into a corner and discussed this for a several minutes. They came back to the undertaker and told him they wanted the president shipped home. The undertaker was puzzled and asked, 'Why would you spend $50,000 to ship him home, when it would be wonderful to be buried here, in the Holy Land, and you would spend only $100?' The American diplomats replied, 'A long time ago a man died here, was buried here, and three days later he rose from the dead. We just can't take that risk.' Boom! Boom! @elle I'm very interested in what YOU have to say. I love opinion but a I said I limit my MSM reading otherwise it can get oppressive. You can't read it all...life's too short. I'm sorry if you found my response lacking.
  3. Just because you don't understand something is no reason, in my humble opinion, to doubt it. I don't understand Swahili, quantum physics nor Chinese mythology. Advanced EWT is not to be taken lightly but that should not in itself put you off. It can be massively simplified, using different timelines helps, and you certainly don't have to able to label W-X-Y (and sometimes Z!). It probably should be thought of more as an art form (subject to analyst's experience/judgement) rather than a science. It is simply, at the end of the day, recording sentiment. DSI is frequently used along with momentum/fibs as supporting tools. Can't remember who said it but "In the short term the market is a voting machine. Only in the long term does it become a weighing machine". Some want hard, definite results. It cannot do that. Nothing can in my experience, but if interpreted correctly it will give you a map of the way forward and therefore low risk entry points. Once you accept that the market is not driven by the MSM then you may be onto something. For example consider GBP/USD Brexit result at the end June 2016. Pound fell quite hard. The actual high of that wave occurred a full YEAR earlier around $1.70/£. Brexit was just a small portion of that wave but not the "cause" for the wave down. MSM dip into their drawer and pull out all sorts of arbitrary labels that they can slap on to try and explain "why". Often laughable and frequently contrary. Consequently, unless from a reliable & reputable source, I don't bother wasting my time reading it ( @elle that's my reply to you if that's acceptable?). If you understand that markets top on euphoria and bottom on despair then you're half way there. If you want results fast then you'll probably have to pay - but use a reliable source. Hopefully that is of some use ....and really, really I'm not here to sell EWT! As a side note I also use EWT to make some of my portfolio decisions As @Mercury said "But hey, if it does't work for you fair enough, find something else that does." I'd fully endorse that. Use it or don't. It's up to you but please refrain from insulting other EWT followers because you "don't understand it". Enough said, and no offense taken. Can we please now move on from EWT? Thank you and apologies for the length.
  4. Quite. Thanks for the great example. He correctly identified the low of wave 2 at 1270 and gave a big hint as to what he expected next. "Turning Up". A big move up in 3 which went off the top of chart!! If you know what you're looking at or employ the services of someone who does then I would regard the above as an excellent example of the power of EWT. Thanks again.
  5. More of a DOW man myself. I see this correction going a bit higher to a wave 2 top. If I'm right then get on board there because 3 down will be long & strong! Late cycle it is then. Hope that's not too much group think.
  6. @TrendFollower, I'm sorry i thought we had addressed this. See my earlier post on the previous page. OK try this as a starter https://www.elliottwave.com/articles (I don't think it's behind a paywall) You can enrol free and will get several articles/video links per week covering all areas. Give it time and keep an open mind. If you are intrigued there are several other good sources and cheaper advised professional services available. Like me you'll have to do your own due diligence I'm afraid. There's no short cut. How anyone could ever be expected to answer that is beyond me I'm afraid. And if they did I wouldn't believe them. Finally, sir, I respectfully ask you to draw a line under it.
  7. @MercuryI think the FRED chart backs up where are we in the cycle. I reckon towards the latter stages so still a bit further to go - hence my wave 4 thought/count (Don't go there). The recent quarterly reports out of US were generally better than expected. When I'm feeling euphoric I'll let you know!
  8. And this needs watching like a hawk. Care to guess what it is? Put you out of your misery!, It's the SX7E - EuroStoxx Banking Index. What's that? Well it's the biggest (roughly 25) banks in Europe (not UK). If they don't pull their skirts up soon....all will be revealed!!
  9. Thanks Mercury fully get that. On topic again. This is what the fuss is about. Inverted yield curves. As for choice of colour ...take your pick. Mine's blue but even that is very close now. Pretty easy to see why this has been regarded as a reliable indicator. The grey vertical bars are recessions. Hope it helps.
  10. And I should add that an economic recession is generally accepted to be a reduction in growth (GDP) in two or more consecutive quarters. Nothing to do with 20% although it's fair to say the stock market is likely to fall!
  11. My understanding is that refers to the period from the inversion point to the start of the recession.
  12. OK I think I see what you are saying but applying your own rules/interpretation of EWT isn't following the discipline. EWI is probably the best authority on this. They have plenty of free resources that can be very helpful with a free subscription. Ah! We all want proof in this world. Who doesn't? I won't be drawn into a us v them on this subject - been there done it - many years ago. It seems pointless to me preaching and I don't see it as my job to do so. In religion/politics/philosophy etc you have your preferences. So be it. Proof would destroy all of then. There are plenty of resources available and then draw your own conclusions. I'll leave it at that.
  13. Mercury, of course, how you label your wave counts is entirely up to you. Corrective waves (according to EWT) are in the following form: ZigZags, Flats (Regular & Expanded) & Triangles. Complicated corrections are usually a combination. A common one is a double Zig-Zag. Triangles can often found in wave 4 or B but never wave 2. Motive waves are usually pretty simple to spot even for a novice. The problem always occur with corrections in my experience. Knowing the substructure count is critical in that respect. ZigZag (5-3-5), Flat (3-3-5), Triangle (3-3-3-3-3). There is often an alternative count (although one will always be preferred) and only subsequent price action reveals which is correct. There are a few rules, but really not many, and some guidelines. With respect Mercury there is no rule nor guideline that I have ever seen that says "the move does not penetrate above the previous high" for a corrective wave!! For those that don't have the time nor inclination you can subscribe to various services. In the hands of an expert, when combined with Fibonacci ratios, trend lines and sentiment indicators it is, IMHO, a powerful tool.
  14. I'm sorry but I cannot rise to that bait. No comment
  15. Sorry for delay ....dental appointment! There is also a potential larger triangle for wave 4. Wave A & C often tend to equality. I'm drawn to this current wave being C down but it could fall short as a wave E. Stimulus or trade agreements being the likely catalyst.
  16. Sure Mercury....how about this?
  17. Not sure what you have in mind with that remark.Unless you know of a more powerful force than that unleashed by QE 1,2 &3? As for drug replacements I'd refer you to the on going antibiotic concerns.
  18. Recent attention to a looming recession has come about due yield spreads turning negative - see FRED. 2yr v 10yr seems to be preferred. It's been a pretty good indicator in the past and for those that say "it's different this time" - I doubt it. Average time from inversion to recession is quoted at 17 months. If that's right then it puts it late 2020 possibly early 21. We now have the longest bull market ever recorded and it's been driven by massive injections from the central bank needle. Drugs work until they don't. This fits with my motto "It doesn't matter.....until it does!" Remember this bull, rising since the GFC, has risen primarily on "bad" news ( i.e.the needles comin'). Any hint it will be withdrawn is met with the screaming abdabs. It's effectiveness is diminished after each fresh dose. You need more and more to achieve the desired effect. The US having the least smelling pile, now has rates at 2%. It's reckoned you need 3% -4% minimum to fight a recession and why, ideally, the Fed wants it higher. The firepower for easing in that situation isn't there. So more Quantative it is. Bull markets die on euphoria. It doesn't feel quite like that yet so I'd say we're in a wave 4 which will be exited on the next QE dose. The Fed will probably paint itself into a corner and be unable to fight the next recession with rate cuts when it comes. All boats (equity and bonds) rose on this last tide so expect the opposite by which time all thought of central banks being the great panacea will have evaporated.
  19. Ah! The $64 million (billion, trillion) question! Where's the inflation? I'm afraid I can only offer my own thoughts on that....there are far better qualified people to be had elsewhere. Here are my personal thoughts/threads however.. QE was used (expanded the Fed balance sheet) to purchase US Treasury debt. Elsewhere same reason. It was intended that it would be rolled over as it matured and sold back to the market. Now there's doubt about that or at least some of it. It could just disappear. You're effectively buying your own debt...nice game, nice game....and if you can do that (with one hand on the money press) then you want it as cheaply as possible. If you're effectively the only buyer, you own the market and that itself drives yields lower. Wash,rinse,spin. Throw in some safe haven moments and you get to where we are today. Throughout the whole of the experiment, and that's what it is because no-one knows how this ends (although I expect badly) it became clear that the elites are getting richer...they were the ones with the assets after all. For assets include everything...stocks, property, antiques, paintings, wine etc. Everything Trump has in other words!. Their pay (board level) also got a huge boost in my opinion from performance related share prices due to unprecedented share buy backs - this is on going because credit has never been so cheap. Your pay almost certainly didn't increase. In fact in real terms it went backwards. Lots of studies support that thesis both in US/UK/Europe. The policy is now driving rates well below zero. Just when you thought rates can only go up from here (2016 low) they actually went lower and bonds were and still are the place to be! Wish I had bought Reagan's long term debt. I think this will continue and it links in with my thoughts about Japan the past two decades. Keeping rates below inflation (and they all do) effectively forces you to do your consumer bit and that was the justification/hope/smoke screen, take your pick!. We'll grow our way out of it - scenario 2 a few posts back. The wealth divide is a real concern now and they know it. In consumer led economies, if the consumer had access to that increased money supply and provides it with some velocity (i.e. gets it moving around the economy) THEN you get inflation. You don't have access to it.........yet. Assets are being held up by funny money. Any whiff the central banks (i.e who now ARE the market) will dial back causes immediate stock market roll overs. Draw your own conclusions. The other thought is simply this. Think of deflation as air leaving your tyre. You're pumping like mad to get it back in but however hard you try the tyre is getting flatter! The hole's too big. Deflation wins.....or if you manage to stabilise the pressure then stagnant growth at best. Possibly stagflation 70s style. Get the plaster on and whey, hey! Hyperinflation here we come. Hold gold. Just my penny worth!...and apologies for the length.
  20. Thanks @Mercury for the personal experience. For a country of about 125 million and only recently relegated to 3rd largest economy it is indeed amazing that they have continued to enjoy such a high standard of living. Stoicism I guess....and one where you have to work well into western standard retirement age. Consequences of all that debt 30 years ago? or a dwindling youth (with no active immigration policy)? Probably both....plus massive, massive central bank intervention. I still believe they are the canary in the mine. If you're not yet retired....you probably never will! (Tongue -in-cheek).
  21. My understanding (simplistic view) runs like this..... If we expanded the Fed balance sheet from $800 billion to 4.3 trillion (with phoney money) and didn't get any inflation then whose worried about deficits? Spend, spend, spend. $1 trillion next year. That's what I meant ...a socialist's (Democrat) dream! As I said...it doesn't matter........until it does!
  22. Meltdown? Some context required. End of 1989 Nikkei stood about 39000. Within 9 months that had halved. Over the next 22 years it halved again. At the low, financial district property worth 1% (one percent!), residential 10% of peak prices. However you look at it I reckon that was a meltdown! Still if you blow a bubble .....it will pop in your eye. They entered a deflationary period 20+ years ahead of the rest. The consequences are daunting. Poor demographics often quoted but not 30 years ago it wasn't. Overall I'm sure the Plaza Accord and the subsequent currency adjustments had a big impact. Resets......reset everything. The Brexit/EU nonsense rolls on but I'm disappointed that the UK media have not picked up on the impending next European banking crisis. The EuroStoxx Banking Index is on a precipice. Levels last seen in late 80s, during the GFC and the last Greek/Cyprus debacle the outcome of which was the current "bail in" process you mentioned. Italy is seriously trying to issue min BOTs (because it can't afford to repay in Euros) to meet its future obligations. that's the third biggest economy in EU. France now well above accepted deficit levels and Germany probably in a recession. Show me the door.......
  23. Thank you JamesIG for your explanation of how IG determine their price charts. "This means there will always be a discrepancy with the highly publicized index price" ... Yes that is also noted but your company "interpretation" has the low 9 days before the other outlets. However you want to spin (explain) it. That makes it incredibly difficult to ascertain what a real low is.....is it the one you show or the one the others show? It also, at least to me, appears that best practise would be served if the resulting price chart reflects the index it purports to follow/promote. EWT users ( I follow a US analyst) will know the frustration. His DOW chart shows a different low....and therefore a different count. Tongue in cheek.....so when was the recent low in the past two weeks?
  24. "....more broadly we have seen currency wars but these have not really captured the imagination of the MSM yet" Actually I'd argue we have had currency wars for some years already. History shows it goes in the following order: Currency war, Trade war, War. (Regrettably). If I recall correctly the market falls of early 2015 (about 20% down) were blamed on Yuan being devalued by Chinese manipulation. Way before Trump! "....we suddenly get a super massive set of central bank policies that drop rates to zero" Again I'd say that has been going on for some years. Arguably you could say about 35 years since the Plaza Accord. Once fiat became unaccountable (no gold standard) the politicians proceeded to spend, spend spend =debt,debt,debt. Expect MMT (US Democrats pushing modern monetary theory) to allow them to continue in that vein. Again history says these currencies will all eventually disappear, like species, approx 95% no longer exist. Broadly I agree with what you say. The present financial system is critically sick that's for sure. It has propped up assets with huge doses of QE and zero rate interest policy (expect more of that when the ECB meets next month). You are correct about the size of stock markets. If the global market was a horse the bond market would be three legs of it! I digress.... However, if you are faced with massive debts then here are your options: 1) Default - Argentinian/Zimbabwe style. Not likely, at least until all other options tried - as that's the end game. 2) Grow the economy at a fast enough rate to meet and exceed future repayment obligations. In a global low anaemic growth environment? Unlikely. 3) Inflate like mad. It's the only viable option. You could, reasonably say, that after 3 massive QE sessions and ZIRP and now NIRP that deflation is winning. Arguably it's all been a waste of time / money. Where's the kitchen sink? Presumably more of the same and then some helicopter money? It seems to me that this is more in line with Japan (targeted 10yr bond rate = 0%) which someone said in the 90s was "...the dress rehearsal. The rest of the world will be the main event". Trying to get inflation without destroying the USD global reserve status is unlikely in my opinion and you can't help but feel that some sort of Bretton Woods global RESET will eventually emerge. It's certainly what Russia, China, Syria, Iran, Turkey etc are angling for.....and their central banks have been big buyers of bullion recently. That's why I'd recommend holding gold. Not as a trading strategy (which is what I appreciate this forum is). Nice sharing these thoughts with you>