A DAY FOR THE BULLS
Oil is up 20% in four days. So, is the problem caused by low oil price mentioned in the Line Bear Letter over? Also, the Greek stock market surged 12% today. Are our problems over? Let the market tell us. Let’s see if the markets Dow, NASDAQ and S&P can get above their December high of 18,068, 4,814 and 2,092?
WHAT DOES THE MARKET WANT TO DO? It is time for the market to tell us what to do. See the chart below: For instance, if the Dow breaks above 17,400 and then makes new highs above 18,086, it would appear that my Lone Bear scenario is either wrong or delayed. However, if the Dow breaks below 17,147 and then breaks below the December low of 17,069 my Bearish scenario would be on track for the Lone Bear Letter! It is the same with reading the NASDAQ and S&P.
THE DAY THE MUSIC DIED! By the way it was the 56th anniversary today ( Feb 3, 1959) of the airplane crash in Clear Lake IA that killed Buddy Holiday, The Big Bopper and Ritchie Valens.
NOT EVEN NATE SILVER KNOWS
Nate Silver, the great prognosticator of elections has thrown in the towel in trying to predict either the economy or the stock market. As I said in the Lone Bear Lette, metrics and analytics can’t do it. It stills takes the human mind to sift through all the written material and to be able to judge human psychology in order to predict the economy or the stock market. Then why did I predict a Bear Market? Sometimes in the human brain things come together like a combination lock and there was a loud click. That’s what happened for the Lone Bull Letter in 1981 when interest rates were 21% and everybody was bearish and I predicted the market would go from 1000 to above 10,000. I have a talent, for being able to read very quickly and to sensitize what I read. It’s just a human feeling when those tumblers fall into place and the lock opens. If you read Isaac Asimov’s Robot Series or his Foundation Series you know how difficult it was for Harry Sheldon, Nate Silver and Carl Birkelbach to predict the future.
Dow NASDAQ S&P
Current 17,666 4,727 2,050
December High 18,086 4,814 2,092
January High 17,400 4,700 2,013
January Low 17,147 4,605 1,991
December Low 17,069 4,545 1,973
|Breakout Points||DJIA||NASDAQ||S&P 500|
|Short Term Up (Resistance)||18,086||4,814||2,092|
|Short Term Down (Support)||17,147/17,069||4605/4,545||1,991/1,973|
|Int. Term Up (Resistance)||18,062 See Fibonacci Projections above||5,002 See Fibonacci Projections above||2,486 See Fibonacci Projections above|
|Int. Term Down (Support)||15,855 /15,356 /14,688||4,166 3,986/3294||1,820 /1,560|
|Long Term Up (Resistance)||18,974||5,132||3,044|
|Long Term Down Fibonacci Support||50%12,000 62% 10,750||50%2,958 62% 2,555||50%1,390 62% 1,177|
|10 yr Treasury 1.78||Gold 1,261||Oil 51.86|