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4:15 EST Update:
Nice. Right on track for a great Bear week into options expiration. Look for as low as 9,100 into late next week. ***** ***** *****
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2:33 EST Update:
A better count looks like my blue 5 (in the 11:20 update) probably completes the first mini 3 wave. No change to outlook, we still get a nice W1-2 fractal, with W2 potentially ending at 2pm EST, or if not, soon.***** ***** *****
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11:20 EST Update:
Again, this is just a possibility:
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IF Dow 9,916 was the kickoff off Wave 3 of Wave C, then we might look to embryonic fractal similarity to find a lottery ticket today.This is certainly not set in stone, it is so early in the 3 of C downturn, if we are even there at this point, anything can happen. This is a "best guess" right now. Wave C's, and especially 3 of C's, are the most destructive waves, so it is entirely possible that the wave form morphs to a plain crumble instead.
The best idea isn't to day trade this baby, rather, "sell and hold."
Yes, there could be an obvious "options lottery ticket" for sale later this morning, for those who understand how to create it, but it is only a lottery ticket. A better entry will be at an even larger degree after some level of confirmation into next week. So don't go play the lottery with capital you might need; capital preservation will be critical in the looming Mother of All Depressions.
With that said, as an interesting exercise, let's look into what is, potentially, the forming DNA of wave 3 of C. This 3 wave could be the most devastating wave Mother Nature has ever crafted to break the stock market. I post this in advance because everyone else talks about stuff after it happens, when it is too late.
Here is the Dow over the past day and a half, since making the recent "Fed-is-a-joke" 9,916 high. I used different colors to discuss various embryonic fractal similarities and their potential implications:
(CLICK TO ENLARGE)
Excellent work
ReplyDeleteFDRAOA,
ReplyDeleteHow far out in treasuries would you go?
Thanks
"How far out in treasuries would you go?"
ReplyDeleteBeing a trader looking for 100s of % in chunks, I can't get excited about long term Ts. I know Ts are a smart place to park, but accepting pocket change to lock up capital might not be the smartest move.
Personally, I buy short term T-Bills to get money through the door, then defund to C of I for continuous access. But that is a trader talking.
FDR
ReplyDeleteCould you please explain again how short term T-Bills are safer than dollars in a FDIC account at Wells Fargo ?
If their is a collapse, i understand that people may not get to their money for months or a year. How is it very likely that you will get to your T-Bills and cash them out in a crazy and frantic state of events?
"Could you please explain again how short term T-Bills are safer than dollars in a FDIC account at Wells Fargo ?"
ReplyDeleteWell, my thought is that the T-Bill is a government promise backed by our entire GDP, and the FDIC is a stone-broke private insurance company with $0 backing $15T.
That helps ! MY guess was that T-Bill holders would be first in line.
ReplyDeleteCashzilla makes a nice screen saver
FDR,
ReplyDeleteI am enjoying this blog quite a bit!
I'd like your comment on a few scenarios.
Scenario #1:
20k Cash in Bank
10k Debt
0k Investments
-----------
Scenario #2:
20k Cash in Bank
0k Debt
10k Investments
----------
Scenario #3:
20k Cash in Bank
20k Debt
0k Investments
----------
Basically, I'd like to know:
1) What would be a proper investment to preserve capital (besides an AR-15 and ammo)?
2) What should the person with debt do? Should they keep the cash in hand and let the debt deflate too??!! Will the rate of debt /asset deflation outpace interest??!! LOL!
3) If a person is currently invested in the market, will cash in hand appreciate faster than shorting the mess?
I hope this is clear! You have a young man up late at night reading voraciously!
FDR,
ReplyDeleteDo you have any thoughts on why the 29-30's
Deflation Bear Market was so quick paced
timewise compared to this 2000-? deflationary
Bear Market?
Could the timeframe pick-up into the C Wave
Thanks
"Do you have any thoughts on why the 29-30's
ReplyDeleteDeflation Bear Market was so quick paced
timewise compared to this 2000-? deflationary
Bear Market?
Could the timeframe pick-up into the C Wave"
Last I checked, on a percentage basis we are ahead of the 1929-1932 fall (from the Dow peak of 14K)
But...
We should be behind it, since our degree is at least one larger, it should be a larger scale, slower decline.
I think a better short term analysis is.... Friday, no volume = stick save and a ramp into the close regardless of Elliot wave. In hind site though after the close the Elliot Wave form will still play out, just will have to be reinterpreted
ReplyDelete"1) What would be a proper investment to preserve capital (besides an AR-15 and ammo)?"
ReplyDeleteI would lean towards mostly plastic guns to minimize door-to-door confiscation.
Minimum of 1 year of cash in home, then T-Bills or C of I.
"2) What should the person with debt do? Should they keep the cash in hand and let the debt deflate too??!! Will the rate of debt /asset deflation outpace interest??!! LOL!"
The problem is that inflated debt stays inflated while assets against it deflate. That is the hook that'll sink most people.
Best idea is to put cash on debt unless you are good enough to outpace the interest rate by trading the stock crash--and--you can accept the risk of market failure breaking your trading masterpieces.
"3) If a person is currently invested in the market, will cash in hand appreciate faster than shorting the mess?"
Depends on you. In general, houses of cards ignite much faster than they go up. So you can probably heavily outpace the growth of cash with shorting if you're a disciplined trader. The key is not to be afraid to jump into cash to avoid excessive risk, its got a great yield so you can and probably should refuge often.