Thursday, December 5, 2013

Sorry Dow has not finished its mini-wave 4

Dow Dropped another 25 points on Wednesday and it opened lower on Thursday morning. The mini-wave 4 can have a possible low of 15,746. But once it goes below 15676 level (the top of sub-wave i, then I will have to review my wave count.

Matthias Chang, "If any one of you venture into the market after Dow hitting 16,000 in the hope that it WILL soar higher, YOU WILL BE IN FOR A SURPRISE. Dow may collapse anytime, even before it hits 20,000".

Click 'Dow at 16,000 - Suicide Poker !' to read Matthias Chang's article.

If one can agree that the current bull run and records setting is fueled by excessive liquidity (money printing), and if one believes that this is something that is not sustainable, then one will have to agree with Matthias Chang that this is a 'Suicide Poker' game. Under this scenario, it is true that 'Dow may collapse anytime'. But as a charting technician, I believe that there should be some 'signs' that tell me to run for my life before the collapse.

Remember the banker that I have mentioned in one of my earlier articles. To him, the assets purchase is supported by solid liquidity. To balance or to absorb the excessive liquidity, the value of the assets has to move to a higher level (new equilibrium). The 'money printing' by central bankers is an unprecedented 'experiment' or 'untested new concept' of the central bankers. It is possible that they themselves also do not know this story has how many episodes and how the story is going to end. Under this scenario, the 'assets bubble' may be able to drag on for a few more years and Dow may go higher than 20,000.

A Super Wave VII scenario.


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