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Dus volgens Fibo labels zou de correctie erop er al kunnen staan nu ( 23,8 % )  of naar 38,2 % = 10306  of 61,8 % = 10470  voor de dow ?

De weekend-update van McHugh, nogmaals zijn standpunt bevestigend dat golf 5 down van 1 down is gezet en we begin volgende week een correctieve golf 2 up kunnen verwachten tot 1/3 of 2/3 van de daling vanaf 17 januari.

For those of you with busy schedules, here is an executive summary:

This weekend's report covers a special report on our next phi mate turn date, our Primary Trend Indicator, and a discussion on the "January Effect," and what that portends for markets in 2010.

Stocks fell sharply Friday, the Industrials losing 53.13 points, closing at 10,067.33. The S&P and the Industrials both hit new intraday and closing lows for the decline from January 19th, 2009, and both closed around key support, 1075ish in the S&P 500 and 10,100ish in the Industrials. It looks to us as if both major indices completed the first significant downleg for catastrophic wave (C ) down Friday. We can count a clear five wave decline as complete in both indices, with ending small degree bullish patterns for their wave {5} down component waves. The S&P and the Industrials completed an Expanded descending Bullish Wedge which we show on pages 23 and 24 in this weekend's newsletter at http://www…..rindex.com . This, along with deep oversold readings in several short-term indices suggests to us that a small degree rally could start next week, which will retrace a third to two-thirds of the 686 point, 6.39 percent decline in the Industrials and the 78.86 point, 6.85 percent decline in the S&P 500. Once this coming wave 2 up bounce completes, a nasty wave 3 decline should terrify markets, and set a negative tone for the coming 2 to 4 year decline.

Downside volume led at 68 percent Friday, with declining issues at 65 percent, with downside points at 90 percent. S&P 500 Demand Power fell 5 points to 353, while Supply Pressure rose 4 points to 392, telling us the decline was moderate and solid. All of our key trend-finder indicators remain on sell signals Friday.

The January effect says that so goes January, so goes the rest of the year. This axiom is usually correct. Not always. It was wrong last year, in 2009. But the majority of the time this is how the market moves. In 2010, January was a down month, suggesting the odds are 2010 will be a down year. The Industrials ended January losing 360.72 points, or 3.46 percent. The S&P 500 was down 41.23, or 3.70 percent. The NASDAQ 100 fell 119.27 points, or 6.41 percent, and the Russell 2000 fell 23.35, or 3.73 percent. This prognostication approach in consistent with our years ending an a "0" study, which is available in our Guest Articles section at http://www…..rindex.com                                                                         

The percent of DJIA stocks above their 30 day moving average remained at 16.67 Friday. The percent above 10 day rose to 13.33 from 10.00. The percent above 5 day fell to 20.00 from 26.67. The NYSE 10 day average Advance/Decline Line Indicator worsened to negative -717.1, remaining on a "sell" signal from January 22nd, 2010, when it fell below the negative -120.00 threshold for a new "sell." 

Our three Blue Chip key trend-finder indicators (other than the Demand Power/Supply Pressure Indicator) remain on a "sell" signal Friday. The DJIA 30 day Stochastic Fast came in at 16.67, below the Slow at 18.67, remaining on a "sell" signal from January 21st. The DJIA 14 day Stochastic Fast came in at 10.00, above the Slow at 9.44, but not decisively above, remaining on a "sell" signal from January 20th, 2010. The Fast had to fall more than 10 points below the Slow for a new "sell." The S&P 500 Purchasing Power Indicator fell to negative -68.91, remaining on a "sell" signal from January 21st, needing to rise above negative -62.91 for a new buy signal.    

The McClellan Oscillator fell to negative -285.00 Friday. The Summation Index fell to positive + 2,668.69. The Demand Power/Supply Pressure indicators remain on an enter short positions signal from Friday, January 22nd. New 52 week Highs on the NYSE were flat at 54 Thursday, with New Lows at 7.

The Plunge Protection Team Risk Indicator rose to positive + 16.08 Friday, January 29th, remaining on a sell signal from January 11th, 2010. Since this sell signal, the Industrials have dropped 620 points.

The NASDAQ 100 fell 30.06 points Friday, closing at 1,741.04. The Russell 2000 fell 5.89 points Thursday, closing at 602.04. The HUI Amex Gold Bugs Index fell 15.60 points Friday, closing at 374.04. February Gold rose to 1083.0. Silver fell to 16.18, while March Oil fell to 72.89 The Dollar rose 0.54 to 79.47. Bonds rose half a point to 118^24. The VIX rose 0.89 to 24.62.  

Bonds are nearing a short-term top. Bonds have reached resistance at their 50 and 200 day moving averages, and the Daily Full Stochastics for Bonds are topping. Gold could drop toward 1,000 before resuming its rising trend. Gold's Daily Full Stochastics are bottoming. Silver has hit support at its 200 day and 50 week moving averages, while Silver's Daily Full Stochastics are bottoming. The HUI reached 375 and is ready to move higher. The HUI Daily Full Stochastics are bottoming. The HUI has reached support at its Weekly 50 and 200 week moving averages. The Dollar has hit resistance at both the 50 and 200 week moving average, the 50 month moving average, as well as the neckline of the huge Head & Shoulders top. The Dollar's Daily and Weekly Full Stochastics are topping, so the Dollar should be poised to decline sharply soon.        

Toch nog even de update van McHugh van gisteravond. Hij suggereert de laatste bewegingen van golf 5 DOWN van 1 DOWN, waarna begin volgende de correctiegolf 2 UP moet beginnen:

Stocks are struggling again Friday, finishing wave {5} down of 1 down. As this email is going out, there is a Bullish divergence between the Industrials and S&P 500 as the Industrials have not hit a new low for the decline from January 19th, while the S&P 500 has. Both averages are having trouble breaking below key support. That may not happen until wave 3 down occurs. The 15, 30 and 60 minute Full Stochastics suggest these averages are oversold, suggesting a pop could arrive Monday or Tuesday next week. These averages are due for wave 2 up. The quality of that rally will be interesting. At wave 2's top, we will likely short the market again, with a prudent strategy that fits our conservative portfolio.

We have updated short-term charts for the S&P 500, Industrials, and NDX and Canada's TSX on pages 8 through 12 in the Weekend International Market Newsletter, now available at the Australia Weekend button at http://www…..rindex.com. This report clearly shows that major stock averages all around the world are in trouble.

Mid-day Friday, the HUI is down 11.58, Gold is down 8.80, Silver is down 0.08, Oil is down 0.84, the U.S. Dollar is up 0.44, and the U.S. Treasury Bond is up half a point.

We will have more for you in this coming weekend's expanded U.S. Market Newsletter, including an update on our Primary Trend Indicator and the next phi mate turn date.

Hierbij de korte update van donderdagavond:

Stocks fell hard again Thursday, hitting new lows, but unable to decisively break below key support levels of 10,100ish in the Industrials and 1,080ish in the S&P 500. The retest of these support levels looks to be wave {5} down for the decline that started January 19^th, which means Wednesday's low was likely wave {3}'s bottom. We have made this adjustment to our short-term Elliott Wave count in updated charts mid-day Thursday for the S&P 500, Industrials, NDX and Canada's TSX on pages 5 through 9 in Australia's Daily Market Report at the Australia Daily button at http://www…..rindex.com

Markets are volatile and continue to press lower, which means Bears need to remain nimble at the coming corrective wave 2 bounce, which may have started at Thursday's intraday lows. It means in a major catastrophic declining wave, in our case supercycle degree wave (C ) down, bounces can disappoint. For this reason, we are more comfortable playing the declines than the bounces. We may elect to stay in cash as bounces approach, and play the ETF DXD or something similar like the mutual fund RYCWX when we identify tops during this stair-step decline. It will be impossible to pick exact tops and bottoms along the way, but we will do our best to get close.

The January effect says that however the month of January does, so goes the rest of the year. It does not always work out that way, however with our previously published study of years ending in a "0" warning that 2010 should be a down year, it looks as if January will be closing at a loss in most major averages, supporting that study.

Mid-day Thursday, the HUI is down 7.52, Gold is down 1.00, Silver is down 0.36, Oil is down 0.31, the U.S. Dollar is up 0.18, and Treasury Bonds are down 3 ticks.

 Opnieuw de laatste update van McHugh. Hij voorziet een daling (wave 5 down) tot eind deze week/begin volgende week, gevolgd door een wave 2 up, die een week tot 10 dagen zal duren.Daarna moet de grote daling wave 3 beginnen.

For those of you with busy schedules, here is an executive summary:

Stocks rose mildly mid-day Tuesday, then fell into the close, the Industrials ending down 2.57 points to 10,194.29. The bounce the past two days only retraced 21 percent of the decline from last Tuesday's high, which is not sufficient to be corrective wave 2 up, so it most likely was submicro degree wave {4} up. The decline into Tuesday's close could be the start of wave {5} down, which when complete should take the decline from last week to new lows and a bottom for the first significant leg of supercycle degree wave (C ) down. This bottom should complete by the end of this week. That bottom should be followed by wave 2 up, a correction of the decline from January 19th's top, which will retrace a third to two-thirds of the decline.

Downside volume led at 69 percent Tuesday, with declining issues at 64 percent, with downside points at 69 percent. S&P 500 Demand Power fell 4 points to 362, while Supply Pressure rose 5 points to 382, telling us the decline was stronger than the price move suggests.

The VIX generated a new "buy" signal Tuesday. This suggests a rally that lasts a week to ten days should start sometime over the next week. Once that corrective rally completes, the next leg, wave 3-down will follow and be nasty.

The 10 day average advance/decline line indicators worsened significantly Tuesday in the NYSE and the Russell 2000. That argues prices could decline to new lows before the wave 2 countertrend bounce starts.

The top alternate labeling is that wave {5} down of 1 down was shallow and brief and completed early Tuesday. See charts on page 10 and 11.

The news continues to be wretched. On Monday we learned Existing Home Sales plunged 16.7 percent in December, the largest monthly drop in more than 40 years. This occurred in spite of the Central Planners extending the $8,000 first time homebuyers credit and the $6,500 relocation tax credit. On Tuesday we learned that the Congressional Budget Office projects the 2010 Federal Budget Deficit  could reach $1.35 trillion. If the economy regresses in 2010, as we expect, this number could be much higher. This is not the stuff of Bull Markets and economic recoveries.

The percent of DJIA stocks above their 30 day moving average rose to 20.00 from 16.67 Tuesday. The percent above 10 day rose to 6.67 from 3.33. The percent above 5 day rose to 16.67 from 6.67. The NYSE 10 day average Advance/Decline Line Indicator worsened to negative -467.7, remaining on a "sell" signal from January 22nd, 2010, when it fell below the negative -120.00 threshold for a new "sell." 

Our three Blue Chip key trend-finder indicators (other than the Demand Power/Supply Pressure Indicator) remain on a "sell" signal Tuesday. The DJIA 30 day Stochastic Fast rose to 20.00, below the Slow at 29.33, remaining on a "sell" signal from January 21st. The DJIA 14 day Stochastic Fast fell to 6.67, below the Slow at 27.22, remaining on a "sell" signal from January 20th, 2010. The Fast had to fall more than 10 points below the Slow for a new "sell." The S&P 500 Purchasing Power Indicator fell to negative -64.08, remaining on a "sell" signal from January 21st.    

The McClellan Oscillator fell to negative -222.39 Tuesday. The Summation Index fell to positive + 3,414.31. The Demand Power/Supply Pressure indicators remain on an enter short positions signal from Friday, January 22nd. New 52 week Highs on the NYSE fell to 75 Tuesday, with New Lows rising to 9.

The Plunge Protection Team Risk Indicator was flat at positive + 19.09 Tuesday, January 26th, remaining on a sell signal from January 11th, 2010. Since this sell signal, the Industrials have dropped 506 points.

The NASDAQ 100 rose 1.47 points Tuesday, closing at 1,803.86. The Russell 2000 fell 5.95 points Tuesday, closing at 612.16. The HUI Amex Gold Bugs Index fell 1.29 points Tuesday, closing at 396.75. February Gold was flat at 1101.8. Silver fell to 16.92, while March Oil fell to 74.70. The Dollar rose 0.30 to 78.48. Bonds fell a tick to 118^09.

The VIX fell 0.86 to 24.55.  

 De laatste update van McHugh; hij verwacht op heel korte termijn nog een verdere daling (golf 5) gevolgd door een pull-back (a-b-c) naar ca 1/3, 2/3 van de daling vanaf 10729 voor de Dow, beginnend eind deze week of begin volgende week.

For those of you with busy schedules, here is an executive summary:

Stocks staged a mild rebound Monday, as we suggested was likely over the weekend. Today, Monday, January 25th was the 19th time out of the past 21 weeks that the Industrials rose the first trading day of the week, either Monday, or the Tuesday after a Monday holiday. Bizarre. Over 80 percent of all the gains from March 2009 through last week's high, have occurred on Mondays. Bizarre. But Monday's bounce was far weaker than what would be needed for a meaningful trend turn. It came on lower volume, which is not bullish. Further, the 10 day average advance/decline line indicator worsened Monday on the small rally, which is short-term bearish. Given this, and the Elliott Wave count we are tracking for the decline from last week's high, we believe Monday's rally was a small submicro degree wave {4} up move. If so, this means more decline is ahead for the markets short-term, to further lows than we saw last week, as wave {5} down does its damage. Once {5} down completes, which will be the bottom of micro degree wave 1 down of this new supercycle degree wave (C ) down move, a rally should occur which lasts a week to 10 days, and retraces about a third to two-thirds of the decline from last Tuesday, January 19th's high of 10,729.89. We believe this rally should start either at the end of this week, or very early next week.

The rally the past 11 weeks, from November 6th, 2009 through this past week, was reversed entirely in just 3 trading days last week, from Wednesday through Friday. Our "over the horizon" analysis saw this coming, with a ton of warning signs evident and published within our newsletters over the past several weeks. We are not in a long-term Bull Market, and have not been by some measures since the end of 1999. The third, and most devastating leg of this Bear Market is starting now if you count this Bear Market as starting in 2007, and the most dramatic wave of the third leg is starting now if you count this Bear Market as starting in 2000. In either case, we are headed for trouble, and we believe trouble has just started. That said, the Fed and Central Planners will do everything in their power to stop, delay, or mitigate this major decline, so shorting will be dangerous.        

Last week was a key reversal week. What that means is, we saw the Industrials and S&P 500 hit new highs for the rally from March 2009, but closed the week at a loss. Getting a key weekly reversal is usually a confirming sign of a major top. Last week was the worst week for the Industrials since March 2009, and last Wednesday through Friday's 3 days selloff was the worst 3 days since March 2009.

Major declines occur in stair-step fashion, so the next thing to watch for is a short-term bottom. The VIX set up the potential for a "buy" signal Friday, January 22nd. It generated a "sell" signal Tuesday, January 12th, 2010. Last week's decline started about a week later. So if the VIX triggers a buy signal this week, we should see the small degree wave 2 bounce start within a week of that signal. Once that corrective rally completes, the next leg, wave 3-down will follow and be nasty.

Most of the indicators we follow are now on sell signals as we show throughout Monday's report. The Industrials bounced Monday on significantly lower volume than the volume we saw the three days prices declined last week, ending up 23.88 points higher, closing at 10,196.86. The Industrials remain below several key support levels, including their 50 day moving average and bottom boundary lines of rising trend-channels from March 2009. Upside volume led at 59 percent Monday, with advancing issues at 58 percent, with upside points at 69 percent. S&P 500 Demand Power rose 1 point to 366, while Supply Pressure fell 2 points to 377, telling us the bounce was weak. Most major averages are now showing a loss for 2010. This is a fulfillment of a study we presented back in December that showed a significant decline has started in the first few months of the year in almost every year the past decade. Once again we are seeing that cyclical price action. We are also in a year ending with a "0,"  which, over the past century, has more often than not produced major stock market declines. We presented that analysis in December as well.

We are doing some long-term phi mate research right now that suggests a major crash leg could take place late in 2010. Any decline now may not have the magnitude initially that several other legs of this coming decline will. But keep in mind, this supercycle degree wave (C ) down could see the Industrials drop 10,000 points before bottoming. The late 2010 plunge should be one for the ages. There could be several plunges throughout the developing wave (C ) down leg of grand Supercycle wave {IV} in addition to the massive one we expect toward the end of 2010. There could be mini-crashes between now and then. The larger declines will come as 2011 approaches, continuing into at least late 2012. The totality of these down-legs should wipe out most of the value of stock market indices world-wide.

We have found huge Head & Shoulders Top patterns in formation for the U.S. Dow Industrials, the Dow Transportation Index, the U.S. Russell 2000 small cap index, Germany's DAX, Japan's Tokyo NIKK, and Australia's SPASX200. These patterns are not yet confirmed, but will be with declines below their horizontal necklines. Once/if those necklines have been broken, there is a high probability that the downside targets will be approached. Those downside targets are close to zero, believe it or not. This is horrific if in fact these patterns confirm.

These patterns add to the body of evidence that a catastrophic wave (C ) down is next, and may be starting. This tells us that catastrophic wave (C ) down will have world-wide impact, and most likely be accompanied by terrifying news events. What those events would be are anyone's guess at this point.

We can only hope these patterns will not be confirmed, which would require a drop in prices of about 30 percent from here. Unfortunately, these patterns are forming well to this point, and there is increasing risk we will see 30 percent declines over the next year or two.

The news continues to be wretched. We learned Monday that Existing Home Sales plunged 16.7 percent in December, the largest monthly drop in more than 40 years. This occurred in spite of the Central Planners extending the $8,000 first time homebuyers credit and the $6,500 relocation tax credit. This is not the stuff of Bull Markets and economic recoveries.

Monday's newsletter shows a chart of the VIX. It shows that the VIX rose above the upper 2 standard deviation Bollinger Band Friday, January 25th when it closed at 27.31, above the upper Band at 23.93. As of Monday, the VIX remains above the upper Bollinger Band. Once the VIX drops back inside the bands, it will generate a new buy signal. A rally should start within a week of that event.

In Monday's report, we also show three prior incidences over the past year when the VIX generated buy signals. In all cases, a rally followed.

The percent of DJIA stocks above their 30 day moving average remained at 16.67 Monday. The percent above 10 day remained at 3.33. The percent above 5 day rose to 6.67 from 3.33. These indicators can remain close to zero for a few weeks as a drop occurs. The NYSE 10 day average Advance/Decline Line Indicator worsened to negative -329.3, remaining on a "sell" signal from January 22nd, 2010, when it fell below the negative -120.00 threshold for a new "sell." 

Our three Blue Chip key trend-finder indicators (other than the Demand Power/Supply Pressure Indicator) remain on a "sell" signal Monday. The DJIA 30 day Stochastic Fast was 16.67, below the Slow at 41.33, remaining on a "sell" signal from January 21st. The DJIA 14 day Stochastic Fast rose to 10.00, below the Slow at 34.44, remaining on a "sell" signal from January 20th, 2010. The Fast had to fall more than 10 points below the Slow for a new "sell." The S&P 500 Purchasing Power Indicator rose to negative -63.14, remaining on a "sell" signal from January 21st.    

The McClellan Oscillator rose to negative -194.45 Monday. The Summation Index fell to positive + 3,636.70. The Demand Power/Supply Pressure indicators remain on an enter short positions signal from Friday, January 22nd. New 52 week Highs on the NYSE fell to 77 Monday, in spite of the price rise, with New Lows at 6.

The Plunge Protection Team Risk Indicator rose to positive + 19.10 Monday, January 25th, remaining on a sell signal from January 11th, 2010. Since this sell signal, the Industrials have dropped 506 points.

The NASDAQ 100 rose 7.57 points Monday, closing at 1,802.39. The Russell 2000 rose 0.99 points Monday, closing at 618.11. The HUI Amex Gold Bugs Index fell 5.85 points Friday, closing at 398.04. February Gold rose to 1102.2. Silver rose to 17.13, while March Oil rose to 75.08. The Dollar fell 0.10 to 78.18. Bonds fell half a point to 118^10. The VIX fell 1.90 to 25.41.  

Bonds are nearing a short-term top. Gold could drop toward 1,000 before resuming its rising trend. The HUI could drop toward 375 before turning higher.

milanek schreef:

jantje61 schreef: Milanek ff een beetje tegengas als iedereen verwacht dat het echt gaat dalen kan er nog wel eens een wave up tevoorschijn komen…….ik zit bv long op S&P met een korte stop.

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Het bericht is van M verheyen he !

O Sorry……

Hierbij de laatste update van McHugh :        

The latest Expanded Weekend Market Newsletter, issue no. 1252, January 22^nd, 2010, is available at http://www…..rindex.com  To access this report, simply log in and click on the Weekend button.

For those of you with busy schedules, here is an executive summary:

Every now and then I get an email asking us why our market narratives focus on a time period "over the horizon" rather than the short-term trend. We will write about a "coming" top while all key trend-finder indicators are on buy signals. It is weeks like this past week which explain why we do this. While our key indicators are outstanding at identifying tradable short-term trends, the problem is that there are rallies and then there are rallies. Some rallies are broad-based, with strong volume, suggesting a Bull market is going on. Those types of rallies are worth investing in a big way. But then, there are other rallies, Bear Market corrective rallies, often fueled by bizarre invisible deep pockets buying, for example where the bulk of the progress of that rally occurs on Mondays, with little to no follow through any other time, and occur on low or declining volume. These Bear Market rallies can be quickly reversed once they are complete. In other words, if you buy into them, you can get caught and experience an unexpected decline in the value of your investments. That is because Bear Market declines are fast, furious, and to someone strictly following trends and fundamentals, quite surprising and damaging.

The rally the past 11 weeks, from November 6th, 2009 through this past week, was reversed entirely in just 3 trading days last week, from Wednesday through Friday. Our "over the horizon" analysis saw this coming, with a ton of warning signs evident and published within these pages over the past several weeks. We are not a technical analysis service interested in riverboat gambling. Our focus is to survive and earn a respectable return safely in the midst of one of the worst Bear Markets in our nation's history. We risk manage our capital, allowing for some aggressive trades, but within the confines of limited risk, both as to amount, timing, and instrument. This approach is incorporated in our conservative investment portfolio model. We are not in a long-term Bull Market, and have not been by some measures since the end of 1999. The third, and most devastating leg of this Bear Market is starting now if you count this Bear Market as starting in 2007, and the most dramatic wave of the third leg is starting now if you count this Bear Market as starting in 2000. In either case, we are headed for trouble, and we believe trouble has just started.         

This does not mean anyone should go short the farm at this time. That would be a very dangerous move. Folks can get wiped out shorting for two key reasons: Markets never go straight up or down, they stair-step, and those periodic countertrend rallies in a Bear Market decline can kill shorts, especially options or futures traders. You can bet the farm that the President's Working Group, also know as the Plunge Protection Team, will do everything in its power to stop a Bear Market decline. They can slow it, can delay declining legs within a Bear Market, but they cannot stop it. There just simply isn't enough money to do that. For example, this week's decline wiped out half a trillion dollars from the stock market. And this decline is just getting started. The second reason shorting is so very dangerous is as a severe Bear Market goes into the throes of the abyss, counterparty risk increases. In other words, you could be right with your trade, and not get paid. We are not at that point yet. Until the Industrials reach new lows, below March 2009, counterparty risk should be minimal. However, the lower prices go, the greater counterparty risk will be. Shorting can be a useful strategy if the timing is right, and the amount is limited to what one can afford to lose in its entirety, and if the trader is experienced with the instrument chosen to short. Most folks are better off just by sitting with cash as prices drop.

We saw several news events this week that started to fulfill the expectation of the language of the market. The market has been telling us for a while, through technical analysis, that bad news events are coming. We saw this week several developments that will contribute to future corruption in elections, and restraint of free markets. Nothing is being done for the American household as things worsen, especially on the jobs (income) front. More bad news is coming as this newborn supercycle wave (C ) down gets legs. We have no idea what those news events will be, but the market does, and patterns are telling us the news is going to be some of the worst ever to occur.

This week was a key reversal week. What that means is, we saw the Industrials and S&P 500 hit new highs for the rally from March 2009, but closed the week at a loss. Getting a key weekly reversal is usually a confirming sign of a major top. This past week was the worst week for the Industrials since March 2009, and the past 3 days selloff was the worst 3 days since March 2009.

But as we mentioned, declines occur in stair-step fashion, so the next thing to watch for is a short-term bottom. It is possible that the first bottom could arrive later this coming week, Thursday or Friday. Then we should expect a corrective bounce that only retraces part of this decline, before turning down again. The VIX set up the potential for a "buy" signal Friday. If you recall, it generated a "sell" signal Tuesday, January 12th, 2010. This decline came about a week later. So if the VIX triggers a buy signal early next week, we should see the small degree wave 2 bounce start within a week of that signal. This would provide another shorting opportunity for short-term aggressive trading.

Most of the indicators we follow are now on sell signals as you will see throughout this report. Let's get started with the data. The Industrials plunged again Friday on very high volume, falling 216.90 points, closing at 10,172.98. The Industrials closed below several key support levels, including their 50 day moving average and bottom boundary lines of rising trend-channels from March 2009. Volume over the past week speaks clearly that a top of significance is occurring. Declines came on rising volume, and advances came on falling volume. Downside volume led at 89 percent Friday, with declining issues at 82 percent, with downside points at 92 percent. S&P 500 Demand Power fell 7 points to 365, while Supply Pressure rose 9 points to 379, telling us the decline was powerful with deep pockets intervention coming in to support prices, buying hard with both hands, accounting for almost half of the buying. Without that intervention, stocks would have fallen twice as far. Most major averages are now showing a loss for 2010. This is a fulfillment of a study we presented back in December that showed a significant decline has started in the first few months of the year in almost every year the past decade. Once again we are seeing that cyclical price action. We are also in a year ending with a "0,"  which, over the past century, has more often than not produced major stock market declines. We presented that analysis in December as well.

We are doing some long-term phi mate research right now that suggests a major crash leg could take place late in 2010. Any decline now may not have the magnitude initially that several other legs of this coming decline will. But keep in mind, this next leg could see the Industrials drop 10,000 points. The late 2010 plunge should be one for the ages. There could be several plunges throughout the imminent wave (C ) down leg of grand Supercycle wave {IV} in addition to the massive one we expect toward the end of 2010. There could be mini-crashes between now and then. The larger declines will come as 2011 approaches, continuing into at least late 2012. The totality of these down-legs should wipe out most of the value of stock market indices world-wide.

Below we see a chart of the VIX. It shows that the VIX has risen above the upper 2 standard deviation Bollinger Band. Friday's VIX closed at 27.31. The upper Band came in at 23.93. Once the VIX drops back inside the bands, it will generate a new buy signal. A rally should follow within a week of that event.

Wave {3} down looks nearly complete, meaning a rally Monday would fit the need for subminuette wave {4} up. That could take prices up 15 points in the S&P 500, before wave {5} down takes prices lower to a micro degree wave 1 down bottom late this coming week. See charts on page 25 and 26.

The percent of DJIA stocks above their 30 day moving average fell to 16.67 from 30.00. The percent above 10 day fell to 3.33 from 13.33. The percent above 5 day remained at 3.33. These indicators can remain close to zero for a few weeks as a drop occurs. The NYSE 10 day average Advance/Decline Line Indicator fell to negative -308.7, triggering a new "sell" signal from January 22nd, 2010, falling below the negative -120.00 threshold for a new "sell." 

Our three Blue Chip key trend-finder indicators (other than the Demand Power/Supply Pressure Indicator) remain on a "sell" signal Friday. The DJIA 30 day Stochastic Fast fell to 16.67, decisively below the Slow at 52.00, remaining on a "sell" signal from January 21st. The DJIA 14 day Stochastic Fast fell to 6.67, below the Slow at 46.11, remaining on a "sell" signal from January 20th, 2010. The Fast had to fall more than 10 points below the Slow for a new "sell." The S&P 500 Purchasing Power Indicator fell to negative -64.03, remaining on a "sell" signal from January 21st.    

The McClellan Oscillator fell to negative -238.30 Friday. The Summation Index fell to positive + 3,831.15. The Demand Power/Supply Pressure indicators generated an enter short positions signal Friday, January 22nd. However, it is very close to move to an exit long positions signal as the two converge. New 52 week Highs on the NYSE fell to 80 Friday, with New Lows at 6.

The Plunge Protection Team Risk Indicator rose to positive + 17.97 Friday, January 22nd, remaining on a sell signal from January 11th, 2010. 

The NASDAQ 100 plunged 60.41 points Friday, closing at 1,794.82. The Russell 2000 fell 11.24 points Friday, closing at 617.12. The HUI Amex Gold Bugs Index rose 0.21 points Friday, closing at 403.89. February Gold rose to 1095.4. Silver fell to 16.92, while March Oil fell to 74.54. The Dollar fell 0.09 to 78.28. Bonds rose 7 ticks 118^27.

The VIX rose 5.04 to 27.31.  

De hype rond Barack Obama heeft welgeteld één jaar geduurd. De populariteit van de president die de verkiezingen won met het thema "change" was de voorbije weken gedaald tot een absoluut dieptepunt.

Maar nu het lijkt het erop dat de beloofde veranderingen er eindelijk gaan komen. Obama werkte een uitvoerig plan uit om de banksector de duimschroeven aan te draaien. Het onderscheid tussen banken en hedge funds was de voorbije jaren sterk vervaagd en daar komt nu een einde van.

Als Obama zijn zin krijgt, dan zal het banken verboden worden om nog langer te traden voor eigen rekening of zelfs maar te investeren in hedge funds. Een nobel streven. Banken horen niet te speculeren met de spaarcenten die hen toevertrouwd werden door brave huisvaders.

Beleggers in Goldman Sachs worden al nerveus bij de gedachten alleen. Een flink deel van de winsten die het beurshuis genereert, komen dan ook uit de handel voor eigen rekening. De aandelen verloren op 2 dagen tijd een kleine 10% van hun waarde. Dezelfde evolutie zagen we ook bij Morgan Stanley, Bank of America, JP Morgan en de andere heersers over de financiële markten.

Alhoewel ik het voor de volle honderd procent ééns ben met het basisidee dat banken niet horen te speculeren met spaargelden van hun klanten, vrees ik dat deze maatregel tot heel wat onbedoelde gevolgen kan leiden.

Obama heeft mogelijk onbewust een einde gemaakt aan deze berenmarkt rally en het startschot gegeven voor fase twee van deze financiële crisis.

Indien banken hun handelsactiviteiten dienen af te bouwen, betekent dit dat de bestaande posities stelselmatig geliquideerd dienen te worden. De financiële markten worden zo geconfronteerd met een overweldigende verkoopdruk terwijl er sowieso al amper kopers actief waren. De perfecte storm voor een vrije val.

De voorbije 3 dagen geven je alvast een idee van hetgeen je kan verwachten wanneer aandelen gedumpt worden in een lege markt. De beursindexen gaven op enkele dagen tijd de opbouwde winsten van de voorbije weken prijs.

Ik heb in de voorbije weken en maanden herhaaldelijk opgeroepen om je aandelenposities af te bouwen of zelfs helemaal van de hand te doen. Een advies dat ik nogmaals kracht wil bijzetten.

Persoonlijk heb ik momenteel niet één aandeel in portefeuille. Ik zit voor 80% in cash (zowel euro's als dollar) en 20% in goud. Niet dat ik veel verwacht van goud op korte termijn, maar het is in deze onzekere tijden een interessante diversificatie.

Speculatief heb ik de voorbije dagen ook posities opgebouwd om te profiteren van een verdere daling van de indexen. In absolute getallen kan je zelfs spreken over mijn grootste shortpositie ooit. Om maar even aan te geven hoe serieus ik het meen!

groeten,

MV

Goede morgen,    Hierbij de nieuwste update van McHugh.

Sluit nu de bullishe variant uit, gaat voor de catastrophic wave C.

Tevens een interessante politieke beschouwing, die wat meer tijd vraagt om te beoordelen.

Dear Subscribers,

The latest Thursday Market Newsletter, issue no. 1251, January 21^st, 2010, is available at http://www…..rindex.com  To access this report, simply log in and click on the Daily button.

For those of you with busy schedules, here is an executive summary:

Wow. What a day. Where do I even begin? The minor news was the stock market plunged. There were two other events that occurred Thursday, one an announcement of intention, the other a ruling by the Supreme Court that virtually assures catastrophic wave (C ) down will occur to its fullest potential, that an economic depression is coming.

First the markets. The Industrials plunged Thursday on very high volume, falling 213.27 points, closing at 10,389.88. The Industrials closed below their 50 day moving average for the first time since July 2009, and have experienced the worst 2-day decline since August 2009. Volume over the past week spoke clearly that a top of significance was occurring. Declines came on rising volume, and advances came on falling volume. Downside volume led at 87 percent Thursday, with declining issues at 79 percent, with downside points at 91 percent. S&P 500 Demand Power fell 7 points to 372, while Supply Pressure rose 12 points to 370, telling us the decline was powerful with deep pockets intervention coming in to support prices, buying hard with both hands, accounting for almost half of the buying. Without that intervention, stocks would have fallen twice as far.

The Industrials are now showing a loss for 2010. The fundamentals, the news, was not good Thursday. Initial Jobless Claims rose 36,000 to 482,000 in the latest reporting week. We also learned that the Philly Fed Index of regional manufacturing plunged to 15.2 in January from 22.5 in December, apparently making a beeline toward zero.

As far as the Elliott Wave count goes, a key bullish alternate labeling has been eliminated with today's decline. We believe Thursday's drop is part of a developing wave {3} down. Wave threes are usually the most dramatic moves. The 15, 30 and 60 minute Full Stochastics are oversold, suggesting a bounce is coming, likely wave {2} up of {3} down. 

The Central Planners announced Thursday that they would impose size limitations on big Wall Street banks, and restrict their investment activities. The plan is to separate commercial banking from investment banking. Under the Obama proposal, banks that take federally insured deposits or have the right to borrow from the Fed would be prohibited from owning, investing in or sponsoring hedge funds or private equity firms. Obama called for limiting the size of a bank to 10% of the nation's insured deposits. Interestingly, the key changes only affect a few large Wall Street banking firms such as J.P. Morgan Chase & Co., but largely excluded is the giant of all the Wall Street banking firms – okay everybody, take a guess – yep, Goldman Sachs Group. That is because Goldman does not accept federally insured deposits. Goldman took a federal charter last year to accept free money from the fed and turned it into profits, however it paid off its TARP bailout loan and no longer needs a federal charter. This essentially gives Goldman Sachs a competitive advantage. This Central Planner step is a knee-jerk reaction to a misinterpretation of why Republican Scott Brown won the Massachusetts U.S. Senate election Tuesday. The real reason was the Central Planners are more focused on Wall Street banks, first to help them, now to hurt them, than the needs of American households. American households need cash from non-debt sources. The best source to provide across the board help would be a major income tax rebate to each and every household. That in turn would stimulate the economy from the bottom up, improving household balance sheets, generating spending to improve jobs generating small businesses.

There are two kinds of government. Think of it like this. Consider the situation where your neighbor has a cow, but you do not have a cow. One type of government approaches the situation and says, "How can we take away your neighbor's cow?" That is socialism, communism, under totalitarianism. The other type of government says, "What can we do to help you get a cow also?" That is capitalism under Democracy. The focus of the Central Planners has been to do the former, not the later. This approach is not interested in helping households increase their standard of living. This approach is more interested in punishing Wall Street banks who did well.

We learned Thursday, January 21st, 2010 that Goldman earned $4.79 billion in the fourth quarter 2009, and earned $13.4 billion for the entire year 2009.

Now to the meat of Thursday. The Supreme Court destroyed American Democracy Thursday. Stick a fork in it. We are done. The grand experiment in democracy called the United States of America had a nice run, about 235 years, but it has been destroyed today, Thursday, January 21st, 2010 from within, the Supreme Court of the United States. The Supreme Court virtually assured we will be completely ruled by an Oligarchy from now on, which will of course lead to dictatorship, as we saw happened in both ancient Greece and ancient Rome. The Constitution has been destroyed. What did the gang of five do? The Supreme Court ruled 5 to 4 that corporations are people, and therefore have the right to spend all the money they want to in support of any candidate they choose. The Supreme Court ruled that corporations have the first amendment right of free speech because they are "people."

They have erred of course, and violated the intent of the U.S. Constitution. They have stretched the definition of "people" to non-people. They have called black white. Up is down. They have redefined the plain definition of a word to something totally different than that word. Corporations are not people. That is common sense and plain to any rationally thinking honest person with a soul. Corporations do not vote. Corporations do not run for election to political office. Corporations are legal creations, associations of people with human souls (shareholders) who already have the right to vote and hold political office. The human souls who are shareholders are not the same as the corporation itself. They are different.

This ruling undermines the integrity of the election system. It throws out over a century of restrictions imposed by Congress against corporations so that they would not influence the outcome of elections. Corporations have an unfair advantage over the small Gie, over real people, in the amount of money they control.

What does this mean? It means future Supreme Court Justices will be appointed by presidents who have been bought, purchased, and are controlled by corporations, and confirmed by U.S. senators who also have been purchased by corporations. It means Exxon Mobil, who earn $45 billion a year, can spend any amount of money they want on advertisements supporting a political candidate. It means any candidate who wants to get elected will cut deals with corporations in exchange for their billions in advertising support. It means Goldman Sachs will decide elections. It means Chubb and Cigna and General Electric and Microsoft and Astra Zeneca will put their people in place in our government, who will pass and enforce legislation favorable to their special interests.

Those who are happy with the Supreme Court's decision believe that large corporations are good, that they know what is best for us, that we should yield our rights and interests for the greater good as defined by large corporations' boardrooms. It means more Enrons, more AIGs, more Lehman Brothers, more World Coms. It means gasoline prices of $10 a gallon if Exxon Mobil decides it needs the money, it means free loans to Wall Street firms so they can invest the money and make more profits and distribute larger bonuses to executives. It means biologically developed diseases being spread over land masses in order to sell more drugs to cure those diseases. It means higher health insurance premiums, mandatory health exams to keep that insurance. It means the elimination of unemployment insurance, elimination of the minimum wage, elimination of social security. It means firing without cause and without severance. It means invasion of your privacy, requiring you to have a chip under the skin on your hand or forehead in order to buy or sell anything.

It means the elimination of antitrust laws prohibiting monopolies, it means the gobbling up of small businesses through unfair business practices. It means more wars so large corporations that produce military resources can profit. It means the changing of all laws and regulations to suit the desires of large corporations. It means no benefits for full time workers. It means requiring more hours or risk getting fired. It means euthanizing patients who are sick and costing insurance companies too much to keep alive.

This Supreme Court ruling changes everything. Whether you are conservative or liberal, you are now a slave, a serf, within the new ruling class, the large corporations. Power will be in the hands of the few CEOs and majority shareholders of the large corporations. Elected officials will be puppets.

The result cannot be good. For those of you who thought those large Head & Shoulders patterns in major stock indices with downside targets of zero were ridiculous, I'll bet none of you anticipated this Supreme Court ruling. Markets know the future. They know where they are headed next. They foresee tomorrow's news today. There are likely more surprises coming down the pike, which will assure the destruction of capitalism, of world economies. This is scary stuff. This decision by the Supreme Court has arrived like a thief in the night. It sets the table for one-world government as future purchased politicians yield to the wishes of large multi-national corporation sponsors.        

The percent of DJIA stocks above their 30 day moving average fell to 30.00 from 63.33. The percent above 10 day fell to 13.33 from 36.67. The percent above 5 day fell to 3.33 from 33.33. The NYSE 10 day average Advance/Decline Line Indicator fell to negative -42.0, remaining on a "buy" signal from November 9th, needing to fall below the negative -120.00 threshold for a new "sell." 

Our three Blue Chip key trend-finder indicators (other than the Demand Power/Supply Pressure Indicator) generated a new "sell" signal Thursday. The DJIA 30 day Stochastic Fast fell to 30.00, decisively below the Slow at 63.33, triggering a new "sell" signal from January 21st. The DJIA 14 day Stochastic Fast fell to 16.67, below the Slow at 56.11, remaining on a "sell" signal from January 20th, 2010. The Fast had to fall more than 10 points below the Slow for a new "sell." The S&P 500 Purchasing Power Indicator fell to negative -55.45, triggering a new "sell" signal from January 21st.    

The McClellan Oscillator fell to negative -151.35 Thursday. The Summation Index fell to positive + 4,093.82. The Demand Power/Supply Pressure indicators generated an enter long positions signal Tuesday, December 1st, and remains there Thursday, January 20th. However, it is very close to move to an exit long positions signal as the two converge. New 52 week Highs on the NYSE rose to 174 Wednesday, with New Lows at 4.

The NASDAQ 100 fell 17.38 points Thursday, closing at 1,850.57. The Russell 2000 fell 11.25 points Thursday, closing at 628.36. The HUI Amex Gold Bugs Index fell 17.38 points Thursday, closing at 403.68. February Gold fell to 1093.9. Silver fell to 17.50, while March Oil fell to 75.74. The Dollar rose 0.02 to 78.38. Bonds rose a point to 118^20. The VIX rose 3.59 to 22.27.  

Hierbij de laatste update van McHugh. Hoewel niet z'n favoriete scenario (is nog steeds een al gezette top), houdt hij toch ook nog rekening met een al begonnen laatste wave 5 up.

Dear Subscribers,

The latest Wednesday Market Newsletter, issue no. 1250, January 20^th, 2010, is available at http://www…..rindex.com  To access this report, simply log in and click on the Daily button.

For those of you with busy schedules, here is an executive summary:

The Industrials fell sharply Wednesday on rising volume, closing at 10,603.15. NYSE volume was higher on Wednesday's decline, after falling on Tuesday's rally after being sharply higher on Friday's decline, and lower on last Thursday's rally. That is topping action. Downside volume led at 78 percent, with declining issues at 74 percent, with downside points at 89 percent. S&P 500 Demand Power fell 7 points to 379, while Supply Pressure rose 9 points to 358, telling us the decline was strong with deep pockets intervention coming in to support prices, accounting for about 20 percent of the buying.

While it is possible that the top occurred on Tuesday, January 19th, what is missing for clear identification of a down trend in stocks is a sell signal in our key trend-finder indicators. They will turn to a sell signal once this downtrend gets legs. Wednesday's drop in prices only produced a sideways signal, not a sell signal. The 15 minute Full Stochastics are overbought Wednesday night, while the 30 and 60 minute Full Stochastics are indecisive. That suggests a decline is possible Thursday.

Arguing for a significant top at this time is an intermarket divergence where the S&P 500 and Industrials reached new highs Tuesday, January 19th, while the Trannies, Utilities, NASDAQ Composite, NDX, and Wilshire 5000 did not.

As for the Elliott Wave labeling, prices fell below bottom boundaries of Rising trend-channels Wednesday in the S&P 500 and Industrials, suggesting a top is in. Prices fell hard below those boundary lines intraday Wednesday, then bounced in what looks like a 3-wave correction of the morning decline. If so, then prices need to continue lower from here. There is an alternate labeling that we show on page 11 that considers Wednesday's low as the bottom of wave iv down, meaning one final rally started Wednesday afternoon which should lead to a top for the rally from March 2009. Our top (highest probability) labeling is that a top is in.

The percent of DJIA stocks above their 30 day moving average fell to 63.33 from 80.00. The percent above 10 day fell to 36.67 from 66.67. The percent above 5 day fell to 33.33 from 60.00. The NYSE 10 day average Advance/Decline Line Indicator fell to positive + 197.4, remaining on a "buy" signal from November 9th, needing to fall below the negative -120.00 threshold for a new "sell." 

Our three Blue Chip key trend-finder indicators (other than the Demand Power/Supply Pressure Indicator) generated a new "sideways" signal Wednesday. Once they generate a new sell signal, prices should fall hard. The DJIA 30 day Stochastic Fast fell to 63.33, below the Slow at 73.33, but not decisively below, remaining on a "buy" signal from January 4th. The DJIA 14 day Stochastic Fast fell to 46.67, decisively below the Slow at 63.33, triggering a new "sell" signal from January 20th, 2010. The Fast had to fall more than 10 points below the Slow for a new "sell." The S&P 500 Purchasing Power Indicator fell to negative -47.28, remaining on a "buy" signal from January 4th, needing to fall below negative -50.16 for a new sell signal.    

The McClellan Oscillator fell to negative -53.68 Wednesday. The Summation Index fell to positive + 4,220.80. The Demand Power/Supply Pressure indicators generated an enter long positions signal Tuesday, December 1st, and remains there Wednesday, January 20th. New 52 week Highs on the NYSE fell to 156 Wednesday, with New Lows at 2.

The NASDAQ 100 fell 27.53 points Wednesday, closing at 1,867.95. Our key trend-finder indicators remain on a "sell" signal Wednesday. The Russell 2000 fell 9.54 points Wednesday, closing at 639.61. The HUI Amex Gold Bugs Index fell 20.43 points Wednesday, closing at 422.43. February Gold fell to 1114.9. Silver fell to 17.98, while March Oil fell to 77.67. The Dollar rose 0.91 to 78.36. Bonds rose a point to 117^31.

The VIX rose 1.10 to 18.68.