Tomorrow’s Stock Market

In 2005 I began to notice chart patterns which were previously useful were turning into traps, For example, when a head and shoulders top  pattern was  completed, a short squeeze would ensue. Every now and then this is normal.  But on every single trading, it is not.

In spring of 2006, Henry Paulson became the first activist Treasury Secretary in history. From spring of that year on, the market had an invisible floor under it.

The lower volume was, the stronger the market would be. The volume chart began making a perfect parabola pattern with few exceptions. Then there was the emergence of the snake pattern, on minute by minute charts patterns, never seen in history  before. All action occurred in the first and last hours. Could there be a conspiracy, devoted to elevating asset prices? Would it even be possible? Could it be done? The 100 or so richest folks in the world  certainly have enough money and power to do it. Would they? A better question to ask is Why wouldn’t they? But, Woo, James, that is conspiracy theory, therefore it couldn’t be true. Right?

Adam Smith, is well thought of, but his observations are routinely treated as platitudes..Some of us take his wisdom to heart. If Adam Smith is to be believed, it is nearly impossible that stock prices are not thoroughly manipulated. So, who should we trust here?

 

 

Lets look at a chart of the Dow along with the percent of stocks over their 200 day moving averages. Around 26 percent are above their 200 day moving averages. This is the level that would be expected at the bottom of a bear market. Is this the bottom? I am betting that the bottom is about to fall out instead.

This is based on the whole bull market being phony from the beginning. The ingredients necessary to move it higher are missing. There is one caveat… that means nothing….. will be done to try and save it. I made a similar point in the article below. In 1987, the market did suddenly crumble but there was a recovery. If we experience that kind of event this year, it will keep on dropping. Any recovery won’t start for at least two years. Our system is so corrupt, any recovery at all should not be taken for granted.

A One Day Stock Market Crumble

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About Fantasy Free Economics

James Quillian independent scholar,free market economist,and teacher of natural law. Who is James Quillian? Certainly I am nobody special, Just a tireless academic and deep thinker. Besides that, I have broken the code with respect to economics and political science. Credentials? Nothing you would be impressed with. I am not a household name. It is hard to become famous writing that virtually no one in the country is genuinely not in touch with reality. But, if I did not do that, there would be no point in my broking the broken the code. If you read the blog, it is easy to see that there are just a few charts, no math and no quantitative analysis. That is not by accident. Given what I know, those items are completely useless. I do turn out to be highly adept at applying natural law. Natural law has predominance over any principles the social science comes up. By virtue of understanding natural law, I can debunk, in just a few sentences , any theory that calls for intervention by a government. My taking the time to understand the ins and outs of Keynes General Theory is about like expecting a chemistry student to completely grasp all that the alchemists of the middle ages thought they understood in efforts to turn base metals into goal. Keynesian theory clearly calls for complete objectivity. Government can only make political decisions. Keynesian techniques call for economic decisions. So, why go any further with that? Fantasy Free Economics is in a sense a lot like technical analysis. Technical analysis began with the premise that it was impossible to gain enough information studying fundamentals to gain a trading advantage. Study the behavior of investors instead. Unlike technical analysis, I don't use technical charts. What I understand are the incentives of different people and entities active in the economics arena. For example, there is no such thing as an incentive to serve with life in the aggregate. In the aggregate, only self interest applies. It is routinely assumed otherwise. That is highly unappealing. But, I am sorry. That is the way it is. I can accept that because I am genuinely in touch with reality. Step one in using Fantasy Free Economics is for me to understand just how little I really know. A highly credentialed economist may know 100 times what I do based on the standard dogma. Compare the knowledge each of us has compared to all there is to know and we both look like we know nothing at all. There is always more than we don't know than what we do know. I am humble enough to present myself on that basis. Why? That is the way it is. I am not bad at math. I have taught math. What I understand is when to use it and when to rely on something else. Math is useless in natural law so I don't use it. While others look at numbers, I am busy understanding the forces in nature that makes their numbers what they are. That gives me a clear advantage.
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Dave del Dotto's Love Child
Dave del Dotto's Love Child
2 months ago

How long and how short are you?

I am hoping to trade what looks like a bear market rally.

Your blog has been valuable and is improving.

You might wish to return to ZH and present it to others. That is how I learned about it.

Thank you for your work.