More socialistic intervention may spell trouble for oil and gold.
http://www.marketoracle.co.uk/Article5500.html
[youtube:http://www.youtube.com/watch?v=angbZB2WeMQ&feature=related 450 300]Fact: Worker productivity has grown 76% over the last 8 years while real wages adjusted for currency debasement (inflation) has fallen 2%.
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>> Worker productivity has grown 76% over the last 8 years while real wages adjusted for currency debasement (inflation) has fallen 2%. <<
Exactly! That’s the point I made on an old post re Ford paying his workers so much cuz if he didn’t nobody could buy his cars … thus explaining the current dilemma and the abuse of credit by Joey Bag-O-Donuts to maintain his standard of living. Couple that with deflation and what to you get? Grrrr….
Recap of Market Prognostication based on OEW theory per Tony @ http://caldaroew.spaces.live.com/default.aspx
SHORT TERM: sharp rally continues ….
Support for the SPX remains at 1240 and then 1219, with resistance at 1261 and then 1287. From the SPX 1200 low, this potential uptrend should unfold in three waves (abc): possibly an ‘a’ to 1287, a ‘b’ to 1240, and then a ‘c’ into the 1320’s. These are all OEW pivots.
MEDIUM TERM: downtrend may have bottomed at SPX 1200 …
From the May 1440 top, where the market spent exactly two hours, this downtrend has continued for two months. As we have noted during the downtrend, every rally had been limited to less than 40 points, for the entire 240 point decline. At tuesdays low of SPX 1200 the market rallied into wednesday reaching 1246, changing the characteristics of the selling. Thursday the rally continued higher to 1262, and then failed to break through that resistance pivot right into friday. This represents a 62 point rally from the 1200 low, which likely indicates that the downtrend is over, and an uptrend is underway. The typical uptrend rallies during a Major wave have been sharp or short lived. We witnessed one in December and another into February. The one in December followed an Intermediate wave A downtrend, and retraced about 50% of the entire decline. This uptrend is likely to do the same. So we would expect a short lived, sharp rally back to around 1320 into early August. There are two OEW pivots around this level: one at 1316 and the other at 1327. One of these two pivots should provide resistance to this uptrend. Then as noted above, another downtrend should follow into the final lows of this leg of the bear market.
LONG TERM: bear market …
The bear market, since October 2007, made new lows this (past)week. But we are beginning to see some light at the end of the nine month , Primary wave A tunnel. The lows for Primary wave A are not yet in place, because another downtrend will follow this rally. But the next downtrend may be the last.
The preferred OEW count, as noted on the SPX charts, is an abc Major wave A into the January low, followed by an abc Major B rally into May 2008. The recent decline from SPX 1440 to 1200 this (past) week could have completed Intermediate wave A of the current abc Major Wave C decline. Upon completion of Major wave C, Primary wave A will conclude, and a multi-month broad based rally should follow.
Now that most of this leg of the bear market has unfolded we can now refine our projections. Since Major wave A was about 300 points (1576-1270), and Major wave B ended at 1440, then if Major wave C equals A the low should arrive near SPX 1140 (1440-306). And there is an OEW pivot at 1136. Next, if the low of this recent downtrend was indeed 1200, then Intermediate wave A was 240 points (1440-1200). A 50% retracement rally to 1320 would complete Intermediate wave B, then the downtrend Intermediate wave C would follow. If Intermediate wave C equals Intermediate wave A, then a low should arrive at SPX 1080 (1320-240). This is in line with our projection of Primary wave A ending just under SPX 1100, and is close to the end of Primary wave IV of the bull market. There is also an OEW pivot at 1090. Therefore fibonacci relationships project the end of Primary wave A between SPX 1080-1140 in the coming months. This will be followed by a multi-month, maybe year long countertrend rally, retracing more than half of the entire decline from SPX 1576.
If Tony’s right, we will have something to look forward to come sometime around October … Odd, no?
The Elliot wave is similar to the GW wave.
I like this guy…nice link!