So far my stock market forecasts for 2016 have been accurate enough. Read through the previous articles for some background if you wish. Further insight will follow.
Stock Market Now Through January 12-29-15
2016 and the Stock Market of Course 1/3/16
Stock Market Heads Up 3-23-16
The forecast made on 12-29-15 has been completely accurate. I am going to update my expectations otherwise it won’t be accurate for the rest of the year. I no longer believe the averages will close up for the year.
I am not using technical analysis. Technical analysis is only effective in a free market setting. When government policy, not free market trading determines stock prices, technical analysis generates loss after loss. High frequency trading firms, friends of the Fed, use trader’s stupid adherence to technical analysis dogma to literally skin them alive.
To know what to expect, I use dog style forecasting. And, that is no euphemistic definitions of one’s self or anything else, complete awareness and knowledge of reoccurring behavior patterns.
The majority of investors still view the Federal Reserve as an autonomous institution staffed by honest economists who know how to improve the economy and are aggressively working in the public interest. I correctly define the Federal Reserve as a political institution that carries out political agendas of politically powerful stock market manipulators. Know that and accept it and you will stay ahead of the game. Chances are that the public will not recognize the Fed’s genuine role for many generations. Given this, chances of a classic bear market developing are minimized. Chances are better that there will be a complete collapse covering a few days or less. Back in December, it looked like a typical Fed inspired short squeeze would hold the averages up through December.
The stock market and the economy will probably collapse on the same day. It will likely work out that way because friends of the Fed are masters at creating low volume uptrends and maintaining them. The only way for actual supply and demand to apply is for the system to break beyond repair. As a rule of thumb in a manipulated market is that slow declines are for drawing in shorts. Rapid declines mean the market, at least temporarily cannot be controlled. Anytime a decline stalls for even a brief period, prices are pushed into what I call launching patterns. These are consolidation patterns that give the appearance that supply is about to take over and a new down leg is about to begin. This is by design. Shorting becomes heavy and the Friends of the Fed start a short squeeze. This process can repeat countless times. Traders for the most part are not aware they are being robbed.
Why will the market crash? The process of providing the elite with seemingly unending profits just for being alive guts the economy of any means of actually growing. The elite have nothing personal against you or I. We are like collateral damage. The rich and the poor have a lot in common other than money. Both have a high incentive to be paid. Each wants to make as much money as possible with the least amount of effort.
The poor are not very good at getting paid. They just go to work. Corporate insiders, given Federal Reserve support, get payed the most and the fastest by running the price of their stock into the stratosphere . Working and generating profits become a waste of time. It takes only a great story and a plan to reap billions in rewards. For this system to work, the poor and everyone else must buy into the notion that all of this is for their own good.
Timing a market crash is hazardous, but I feel like we are really close. There does seem to be some breaks in the ranks of the the elites. If even one friend of the Fed bolts, everything could come crashing down. Clearly the central banks are buying stocks outright. There is no way to tell how much they will buy or what they can get away with. To keep friends of the Fed on board, they must be offered a risk free trading environment. These are not patriots and they can only make a profit with the Fed’s thumb on the scales.
My best estimate is that a crash will hit between now and the Republican convention. The most prudent thing a person can do is stay out of the market until after it crashes. Just know that it will. I am still long some bear etfs and short a few stocks and have a slight profit for the year.