NEoWave Institute's Glenn Neely is forecasting the largest vertical drop of the decade for the S&P 500. Neely predicts the stock market will decline 50% in the next 6 months.
Aliso Viejo, CA (PRWEB) June 16, 2009 -- Glenn Neely, founder of NEoWave Institute and prominent Elliott Wave analyst, today announces a startling prediction: The S&P 500 is forming a major top in June, which will be followed by a large decline, eventually pushing the stock market to record lows for the decade.
"Technically speaking, according to NEoWave a correction began at last October's low; the March-June rally is the final leg of that correction," Neely explains. "The March-June rally is now ending, allowing the bear market to resume. During the next six months, the S&P will decline 50% or more, breaking well below 500!" Currently, the S&P is hovering around 917.
Glenn Neely is providing this information not as a specific trade recommendation but as a general public service announcement. A prominent Elliott Wave analyst, Neely was recently recognized in Timer Digest's May issue as the #1 stock market timer for the past 12 months.
Full Release here
17 comments:
Allan,
Thanks for sharing this from NeoWave. Some way out the money puts could be very profitable!!
Anon, which one ???
Thanks for the post.
All the more reason to keep NG in the WatchList.
-Mike
Several ways to profit from the crash would be to buy either short term spx puts or go out several months to the end of the year with the spx puts. The spx closed today at 910.71. The July 500 puts are at $15 and the Dec 500 puts are $350. If in fact we get the C wave crash the market will go down hard and fast. So each month a person could purchase some puts as a hedge.
I got a question. According to the chart you showed last year, Neely mapped out a 4 year bear market with two alternatives. Green and Red. Neither of those mapped out cases seem to be aligning with what he is saying now.
what gives?
>what gives?
A few things have happened since then to change the forecast. Perhaps you could scrape up the $39/month to subscribe and keep up to date?
I happen to agree that we are in wave C of the usual A-B-C correction that follows any large 5 wave Elliot wave pattern. However, I'm not sure how NG is so positive about what happens next. couple facts about Elliot Wave (which I'm sure NG knows well, but I want to throw out here):
A. Just because we completed a long-term 5 wave pattern, and are now finishing a 3 wave post-move correction, there is no guarantee that the ensuing wave 1 will be in the same direction as the previous trend.
B. NG could argue that we are not finished the 5 wave pattern yet, and that we are in wave 4 right now. Of course, ABC corrections dont just happen after a move, the wave 2/4 corrections can be ABC or more complex corrections within the larger trend. So, if NGs argument is that we are in wave 4, then the next drop, wave 5, must complete with a new low. Technically speaking, a close around 670 or lower could fit this profile. Thats about 240 points from here. Painful for bulls? Sure. 50% end of the world cliffdive? Not really.
Wonder if NG has done the math to figure out this prediction. Problem with S&P sub 500 predictions is that none of these bears realize what some stock prices would have to be for the index to run that low. Not to mention the manipulation (cough, I mean free market purchases) that occurs in the futures markets. Somebody out there is gonna load up on positive futures if we go that low again (happened in March, part of what started this rally!!!). Finally, too much demand for many of the S&P names would come in about 20% down from here. Again, too much to allow declines that large.
Now if NG has some cataclysmic event her foreshadows to , thats aifferent. Absent another trauma that systemically damages our capital markets, theres just too much newfound hope in the market to let it go that low without furious buyers stepping in.
Derek - Neely has his own version of pattern recognition analysis that shares only partial similarities with orthodox EW. It is complex and way too complicated to take on here, but is well worth your independent study. Glenn made a rare public statement today, I am respecting the enormity of its implications.
I dunno Allan....the government does not want the market to crash and I think they have the tools to keep it from crashing.
Anon, I respectfully disagree, the government do 'not' have the tools to keep it from crashing ... they already run out of tools, even printing more money is not going to prevent the crash ...
Allan,
In re-reading earlier posts, you mentioned the Dines Letter - -back in Sept 2008. Beside, that call, can you provide your thoughts on the Dines Letter - -thanks
Allan,
Thanks for this post too, EW is much too sublime and intricate in it's power to be uniformly understood and used so badly and unfortunately incorrectly by so many people (including myself) but Glen's outlook is pretty much correct with and in line with independent non EW analysis such as traditional TA, even fundamental TA and even exotic things like Kondratieff cycles (which IMO are basically very sound....and Ian Gordon is a such a good interpretor at that stuff it's incredible).
Even good ole Prechter is at the core...correct, although the way he comes across he scares the living pants out of many people...maybe that's necessary..
All good stuff again, thanks.
Hey guys, just rolled in from vacation. Am I too late for the rally? I don't want to miss all those profits coming from the green shoots. LOL
You really have to laugh at the Associated Press today: "A surprisingly bleak forecast for the world economy pushed stocks to their biggest loss in two months."
SURPRISINGLY? Those numbers that the bulls were crowing about were all cooked. Jobs are getting worse, not better. Housing is getting worse not better. Therefore, financial matters will continue to worsen, despite huge GoldmanSachs bonuses for "huge profits" paid for by the taxpayers.
All you can really trust is price action because the fundamentals aren't all that fundamental anymore. It's a full time job keeping track of the lies. You might as well just follow price and ignore the babble. When will we learn that we just have to take our medicine? Until P/E ratios shrink to more reasonable levels and the economy grows, this market is going exactly nowhere but a zig zag path to the bottom of the ocean.
Smiddywesson
Prediction didn't work. It's rallytime.
Man, is this guy wrong..big time.
Someone posted that Neeely told him in July that he staked his career on the fact that March 2009 would not be the low. Now I hear he thinks all the triangles he had must be thrown out and that we are halfway through wave (b) and will do a triangle and not make a new low. Man, that haad to kill subscribers to be waiting for a collapse. The guy has been wrong for 200 S&P points. That is an expert?
An old song singed by Neely
http://www.prweb.com/releases/2010/01/prweb3492414.htm
Post a Comment