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I found this post and the Head and shoulder post not only interesting but
almost similar in their prediction of the demise of the DJIA. They both talk
of a low of under 6000 and even lower. Is this going to be a classic
retracement action of the magnitude referende in the TA books? In numerous
TA books , (Pring's , Murphy's, Elder's and Schwager's) they discuss
retracements of 1/3/ and 2/3 's. We are getting close to the 1/3 since the
Dow has begun its unprecdented rise. If history repeats itself (as it often
has although not exactly) and the H & S and the Elliot wave analysis proves to
be accurate than I believe we should expect a bear market that will retrace
about 50 % of its gain. The question is when. Again being a believer in
crowd histeria this could happen within the next month. Wouldn't that be a
surprise as the next month is Oct.
My real question is: has anyone else come to the same conclusions in their
analysis? Are not many stocks trading below their 200 day moving averages,
PE are outragously high (I know TA purist do not believe in fundamentals but
we cannot deny that PEs have been at an all time high, the world economy is
soft and our leadership although not totally paralized is suffering from a
sunken chest wound.
I am not advid trader and I sure do not have the technical background that
many on this list has but I do read what is printed and right now I am concern
that the bubble will bust especially if another straw is added to the camel's
back.
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