THIS IS NOT THE BEGINNING OF A MULTI-YEAR BEAR MARKET

Extreme right translated multi-year cycles are not how extended bear markets begin. They often end in some kind of crash, but bear markets don’t start with a crash.

145 thoughts on “THIS IS NOT THE BEGINNING OF A MULTI-YEAR BEAR MARKET

    1. Gary Post author

      Historically though bear markets don’t start as a crash in an extreme right translated cycle. So the odds are heavily against this being the start of a protracted bear market like a lot of people are now calling for.

  1. Dee

    What about gold? Is it going to pullback for us to buy it? I assume it has to rally if the market sells off.

  2. David Silver

    NICE theory Mr. Savage
    MY theory (based on historical data):
    S&P pivot points:
    TEMP bottom 1875? (THIS 3rd time will fail) hence a MUST trip there from here NOW
    1767.99 (IMPORTANT Nov 2013 support/resistance zone) hence a MUST trip thereafter in between bounces)
    1357.04 (TRUE 36.43% bear market drop from May 2015 top aka 2134.72)
    Timing band (time window):
    NON-FED intervention (2 1/2 years) Nov 2017
    FED intervention (QE 4 easing) 1 year 4 months aka Sept 2016

    On a side note:
    Silver miner candidates either @ open (depends on NY pre-market OR strategic limit orders)
    FSM
    GPL
    SSRI

    1. Brandon J.

      David & Gary,

      September ’16 would be right about time for Gold’s 8 yr CL, yes? That seems like a reasonable time frame for beginning of Gold’s catapult.

  3. Walt

    I agree w Gary . This is a correction with higher highs to follow later this year .
    Bear market starts in 2017

  4. David Silver

    Bear market INDEED:
    All US Indices possess a doming pattern
    MOST equities also possess similar pattern
    Bear market started summer 2015

  5. pepe le pew

    David Silver,

    I would also look toward THO (TAHO), SLW, and FR (AG). The first broke out mid week and consolidated on Friday; the second had been languishing until a big move up Thursday and good resistance to Friday’s correction; the third will break out explosively if/when the PM complex kicks it up a notch in the coming week.

    I believe that silver is going to deliver a punch that a lot of people are dismissing as possible. People saying that it is too industrial to catch a bid in this world economic (read China) environment. When stocks continue down and liquidity rotates, silver will play catch up to gold as a PM investment.

    Thinking (wishful?) this begins in earnest by Tuesday, dependent on gold finishing it’s present correction.

    1. David Silver

      Thank you pepe!
      SLW and TAHO consolidating indeed
      AG (weakest of the bunch technically)
      SSRI (AWESOME basing)
      FSM (BEST technically heading higher)
      GPL (darkhorse/basing at lower trendling/good time to nab shares)
      Aiming for FSM and GPL

  6. felix

    How long do you think will last the next (and the last one…) phase of the bull market??
    Thanks.

    Felix.

    1. Gary Post author

      Maybe a top in 2020???

      Then followed by a multi-year bear market once the parabolic bubble collapses.

      1. tulip

        am I remembering correctly Gary… didn’t you say weeks ago a top for the Dow
        in 2018…. ? maybe I got it wrong..

  7. ChrisG

    When’s the potential big bottom? R2K may provide clues. It led the market down, so could provide clues. It could be the first to test breakout point at 850. Now 1050. 20% more to go. With bounces in between

  8. Stevie

    Can it be possible the 7 year low occurred in August 2015? Classic flash crash that got quickly reversed. If market bounces right back above 2050 then the bubble phrase can begin.

  9. Dan

    Yeah yeah yeah. You and Armstrong and every other letter writer and most mainstream long only fund managers, dismiss the bear market scenario outright. Let’s see how that goes. Plenty of Stocktwitters still anxious to catch a bottom..

  10. ChrisG

    Dan, Armstrong saw this sell offs. He knows new highs not on the cards. Big drop, crash then bubble just like Gary

  11. Stevie

    What exactly are folks afraid of again?

    Theres no bank failures.
    Employment is at 5% and improving.
    Jobs are expanding.
    Earnings are strong.

    1. Gary Post author

      That’s why I think this is just a correction. We just need to change sentiment after 6 years of QE driven bull market. Then the bubble can begin.

    2. Martin

      Thanks for the humor.

      Theres no bank failures.
      Employment is at 5% and improving.
      Jobs are expanding.
      Earnings are strong.

      The reason Armstrong predicts stocks to rise after a crash is he thinks money will flow out of government bonds into stocks.

  12. ChrisG

    I have been looking at Deutsche Bank, DB, for a while. It’s looks like Lehman moments. Any opinion, insights?

    1. AlexP

      short term it alongside European banks makes an excellent swing trade for going long for 2 reasons:
      – stocks will start their bear market rally on Tuesday
      – ECB will increase its QE gun the other gun.

      I EXPECT THIS BEAR MARKET RALLY TO BE POWERFUL FOR THESE 2 REASONS AND EUROPEAN BANKS WILL BE LEADERS IN THIS FUTILE ASCENT.

      After that, once SPX clears above 2070 nearing pivot 2104, the story will change as stocks dumping time will come and getting in on the short side will make sense.

  13. abaud

    Can the Fed do more QE? I have heard and read they are way too over-leveraged, like over twice the amount Lehman was, and being as they are composed of private banks they need to unwind, which is what they started doing.

  14. Jay

    It’s a multi-year bear in commodities and absolutely nobody saw THAT coming….but I guess the Fed doesn’t care about propping up commodities the way they prop up stocks and housing.

    1. Gary Post author

      It was important that the liquidity from QE3 didn’t flow into the commodity complex or it could have caused another recession like it did in 08.

    2. Dan smith

      Yes people saw the multi year bear in Commodities, nobody on hear of course. But not everyone has been bullish. Analyst saw and posted charts showing gold falling to $800 and silver $9 in 2011. I specifically remember the headline “Could silver really fall to $9.00” posted in 2011, how people laughed at the time.

  15. David Silver

    Chris:
    I think you’re on to something:
    DB technically is the ULTIMATE short (been downtrending since 2009 and now UNDER her 2008 lows!
    In fact pick your poison:
    DB (Germany)
    C (USA)
    BRC (UK)
    Emerging markets
    ALL toxic
    Alex:
    S&P 2100?
    WAY too much technical damage across the board.
    Going to look more deeply in this DB thing (gonna catch some surf)

  16. Walt

    That’s the kind of market move that I have come to know . Shake everyone out if their fantasy positions .

  17. tulip

    Economic Collapse Happening Now-Rob Kirby
    on: 01/10/2016 by Greg Hunter 1 Comment
    3bBy Greg Hunterโ€™s USAWatchdog.com (Early Sunday Release)

    Macroeconomic analyst Rob Kirbyโ€™s predictions of a downward spiraling economy are coming true. Kirby contends, โ€œI think the last time we spoke, it was in early December. I suggested that a window was opening where we were very likely to see some systemic breakdowns in our financial universe to likely start occurring. Low and behold, it looks like we are seeing the beginnings of exactly what we were speaking of. The reason why we are beginning to see these things start to unfold now is that everything weโ€™ve been told by our financial elites . . . has basically been a lie or a false flag or fraudulent.โ€

    (moreโ€ฆ)

  18. David Silver

    Walt:
    Yes that was then, this is now:
    Failed rally to highs
    Retest time
    Play reverse psychology here:
    Everyone now bearish thinking do the opposite (NO, do THE opposite of opposite if that makes sense or a double negative force equals positive) hence a crash

  19. Will

    Contrast
    DXY: Dec’s monthly hammer, weekly long-tail shooting star like candle.
    XAU: Dec’s monthly doji , weekly bullish engulfing.

      1. Will

        But, it is being supported by major horizontal support along 2009 – 2011 period’s top! So, while bearish, bounces could happen swiftly too!

  20. David Silver

    Shanghai down 2% oig of the gate
    I dare you guys to buy the open
    I may dabble in some financial shorts rather than silver miners since I double downed on gold miners Friday and have zero exposure to financials
    Sifting through load of ETFs (thanks Chris)?

  21. Mike R

    Gary could be right. It won’t likely be a multi-year bear market. Just a once in a lifetime stupendous crash virtually straight down to a bottom. Probably around S&P 800 or 900 by year end.

    Just look at commerce data, worldwide.
    BDI down 96% in 74 months.
    Ships at a complete standstill (empty) on the shores.
    In fact, For the first time in known history, not one cargo ship is in-transit in the North Atlantic between Europe and North America. All of them (hundreds) are either anchored offshore or in-port. NOTHING is moving.
    https://www.superstation95.com/index.php/world/750

    CRB from over 450 to now ~170.

    What part of goods aren’t being consumed, and things not being built, at the rate that they were previously (mid 2014 when oil last peaked), do people not understand ?

    That US stocks are still at this level, is frankly a miracle of levitation. (david copperfield, anyone ?)

    Wallstreet analcysts won’t be able to ratchet down earnings forecasts fast enough to save their sorry hides.

  22. David Silver

    Mojo:
    NO poker mojo this past weekend ?
    Wave magnet mojo yes ?
    Investment mojo this week?
    BTW:
    Just found out the surfing area (NON beachfront) new home development WAS $1.2 million to $2 million!
    Get someone say bubble?
    1989 and 2006 all over again?

  23. AlexP

    USX on day 22 is quite likely to have set its DCL today in Asian trading at 98.14.
    With such a demeanour of USX and with the swing high of GDX on miners:
    – GDX is clearly already entranched in daily cycle decline and MOSTL LIKELY ALSO IN AN INTERMEDIARY CYCLE DECLINE.

    This miners’ action anticipates gold’s fall into a most likely last-down-leg –> RUNNING GOLD LONGS NOW IS VERY RISKY, RISKIER THAN BUYING STOCKS, WHICH ARE ABOUT TO START (UNLESS ALREADY STARTED IN FUTURES TRADING) A VERY POWERFUL BEAR MARKET RALLY NOW.

    1. Gary Post author

      I have the dollar on day 17. Could be as many as 15 more days before the cycle low as alot of the cycles have been stretching long lately.

  24. David Silver

    Alex I challenge you to go long US stocks at the open and/or to short metals/miners
    I was hoping for a green open to short something on a momentary spike BUT:
    Shanghai NOW down 5%
    Crude tanking
    Rattling a tad in NatGas
    Gold soaring (target 1145.42)
    USD is going to 94
    At the moment looking at shorting DB OR the likes in an ETF

  25. David Silver

    Futures did a 180
    Clive Maund just issued a crash warning
    Last week is just the beginning and a warning signal
    The trick is how fast you draw your pistol
    Interesting times

  26. Ant

    Gary
    Could you pls record the videos at higher decible volume? It’s hard to hear a oints Thank you.

    1. Gary Post author

      The sound comes through loud and clear on all my devices. I think you just need to turn your speakers up.

  27. David Silver

    Man IF futures can hold green, this dude’s going shopping half an hour into trading:
    1) Financial inverse ETF
    2) Silver miners
    IF she mildly into the red then it’s a hold
    IF she DEEP into the red then it’s a sell across the board for a reload
    Damn 4:30am wake up call

  28. Will

    FTSE China A50 – looking to bottom with another “-3% to go on its weekly chart”. So, this can be any time now. If this doesn’t pan out, then, out look from below on its “monthly chart that has another -20% to go before bottoming on its vertical support channel from 2005’s bottom.

    For now, i got with the 1st scenario as support remains support until it is proven otherwise!

    Won’t do any ‘long’ though…

  29. AlexP

    David, I will take the challenge to short gold after a short while but with stocks the story is different: now that stocks have confirmed me that I had been wrong considering the bear over (after Nyse Composite penetrated convincingly its 200Wma on a weekly basis), I would long stocks further only if I were a swinger or scalper.
    But I am neither …. I am a momentum trader with a larger investment period, so that I will stick solely with the longs I set on late last week of which I have not been stopped out: SLP and LNKD aiming to dump them on the NON-FANTASY, QUITE REALISTIC BEAR RALLY WHICH HAS JUST STARTED ๐Ÿ˜‰

    1. AlexP

      had NYSE not closed the week below its 200Wma, I would have invested in stock to the brim, as I had pointed out, but doing so in a confirmed bear market is against one of my risk management rules.
      Shorting gold, on the other hand, will come in quite nicely later today ๐Ÿ˜‰

  30. AlexP

    one more word: the character and structure of this bear market is NOT prone to any more crashes.
    All right, I admit once more, I was wrong anticipating this correction since late October only as a natural reaction within an established bull market while it has proven to be a continuation of the bear market which had commenced in May (the direct effect of which that my target of spx=1967 was taken down to 1919), BUT:
    – while the bear will prove brutal and of at least 8 more weeks,
    – it will not result in any crash, neither now (especially that WE ARE ALREADY RALLYING) nor later.

    SPX can go down to 1600 (I don’t know ) but it will be done without any crashes

  31. AlexP

    ๐Ÿ™‚ Well, David, it looks like the short gold trade you’ve put there is paying in some profits already ๐Ÿ™‚
    regardless of that, you know that I am a coward and great opportunist, I will not enter the short gold trade earlier than 5 minutes before the end of today’s session !

    Now I am 34% invested in the stocks I bought last week on Wednesday and Friday:
    – LNKD 14%
    – SLP 20%.

  32. William

    Hang Seng Index – Just noted that it’s almost touching (circa 2-3% away) the grand monthly vertical support channel all the way back to 1987s…It’s either make or break time!

    1. AlexP

      William, it will be a make ๐Ÿ™‚ breaks of NYSE’s 200Wma and daily closes below Keltner (10,2,10) bottom shortly after and also produce strong rallies.

      European indexes are set to produce today piercing patterns whereas the US ones haramis

  33. ChrisG

    When markets leadership are all gone, and say that market is a buy, that market is out of the woods, I think is very reckless. Such guesstimates will get the misinformed into big troubles. But if course, if you only buy very little bit, there’s no harm trying.

  34. ChrisG

    I think market is due for a bounce. Based on price action. The next short zone will be re initiated at the 10ema.

  35. Walt

    Perhaps some of those billions and billions of digitally money from all these profligate countries around the world finds its way into the US stock market, that’s the cleanest dirty shirt .

  36. ChrisG

    And the good news is…. If market crash , gdx will follow suit. So when tis market bounce for 2 days, it will rally gdx up, and in doing so, gold up too. Remember, tis is January, gold goes up regardless of stocks or dollar moves. It will find excuses to go up

  37. ChrisG

    The best place to load up on shorts is to let market come to you. Don’t force it. The where’s the place? At the declining 50 dma

  38. ChrisG

    Yes Walt. If it is really bearish. Then when it makes new low, measured move shall be 1811 ish. Just nice, 200wma

  39. AlexP

    Hi, David.
    Nope, I am not short gold yet. I will see if gold is shortable indeed 5 minutes before the close the earliest (or I may do it tomorrow).
    The way I do it, the skeleton of my trading, so that you can see why I am not in yet:
    1) I set Trading Frameworks (the kind of forecasts that I also input here) –> but they are not tradeable, they are simply what I call them “Trading Frameworks”; then
    2) I have risk management rules which if cleared
    3) I look at the entry rules which if also cleared (i.e. the market confirms my anticipation, the Trading framework) then I HAVE AN ENTRY, but not every entry because
    4) I also have the positioning rules based on which and general market trend, I set what weight to give that entry.

    Now reverting to the gold short trade, I do have the Trading Framework that I posted yesterday evening (Bucharest time, afternoon in NY) which anticipated the resumption gold’s intermediary cycle decline, but before I actually enter and need some clearances from Lady Market.

  40. Walt

    It looks like it will be falling asset prices :
    stock markets / real estate values around the world that will be the trigger of the next recession / bear market .

  41. Walt

    People look around and see that their net worth is way down , then don’t spend money, which leads to recession / bear market

  42. AlexP

    Miners confirming my expectations that they’ve started their daily cycle decline –> it will not be late that they will prove they’ve actually begun their intermediary cycle decline too ๐Ÿ˜‰

    1. AlexP

      indeed, Walt ๐Ÿ˜‰ most likely in the beginning of March (90% rough probability)

      there is though one slight probability (I would say 10%) that the low in gold would come later in the year, in the autumn, if the YCH of USX in the third yearly cycle would be higher then the YCH to be set in late Feb / early March for this second YC.

  43. Crawford

    The 1910-1912 level is strong support and the 1897 is very strong support. On the upside, the bulls need to take out 1928 resistance, then 1936-1937, which will lead to a test of the strong 1942-1943 level, and that will lead the way to the 1949-1951 resistance. If bulls take out 1951, then 1961 is next.

  44. Gary Post author

    Gold is not starting an intermediate degree decline yet. The weekly stochastics have barely emerged from oversold. Bear market rallies need to go further than that in order to generate fuel for another leg down. All but one bear market rally has pushed the weekly stochastics to overbought before turning back down.

    The COT levels are still massively bullish. And sentiment is way too bearish. These are not levels from which an intermediate decline begins. Gold is likely just dropping into a daily cycle low to be followed by a second daily cycle higher to around 1140-50 before the intermediate cycle tops.

    1. AlexP

      I guess it depends on what USX will want to do…gold is a follower.

      I got sopped out of LNKD at 215.00 too; total equity loss since Wednesday of -1.76%.
      Holding only 20% in SLP with stop loss at 9.48.

      Stocks want one more drop before putting their DCL; bear market rally is not there ready to go yet

      1. Gary Post author

        I’m going to suggest that you have the wrong cycle count is why you continue to be stopped out trying to pick bottoms here. Stocks are on day 18. They still have 3 weeks to go before the final bottom.

        I’m looking for some kind of bounce once the SPX tests the Sept. low then a bloodbath phase down to the 200 week moving average around 1790.

  45. AlexP

    ..and this SLP that I am holding at nearly full position does frustrate all bear market –> the SLP pick makes one of the very few stocks on AAALLL WALL STREET (I cannot even number them on all my fingers) that rallies, carelessly of all around it – a relentless runner through any ice and all havoc

  46. Walt

    I’m agnostic here on gold and the stock market , with a bias downward in both .
    Certainly no positions here . I had shorted the s&p from 2077 to 1965 and covered there . I’m just waiting . I’ve become really patient w gold . Haven’t touched that stuff for yrs

  47. zkotpen

    Gary,

    Weekly slow stoch did not get overbought during the March to May, 2015 rally, not for gold or GDX.

    I believe the current rally/consolidation is of the same degree as that one:

    Weekly slow stoch will not get overbought, that is until AFTER it makes a new lower low, and gets oversold first.

    Right now, I believe 15.01 is the peak in GDX — in the unlikely event that it is exceeded (before a new lower low), my current top is ~15.26 (this value is decreasing by a couple of pennies per day).

    The move down in GDX will not go below $11, based on this week’s chart (this limit is not fixed, not linear, but on a curve that I monitor).

    Gold, on the other hand, may make a slightly higher high pushing 1139 — that is getting near what my TA considers extreme. My more likely target is in the mid-1120’s, while GDX either just makes or just misses exceeding 15.01.

  48. Walt

    Ummm… Look at GDX its down almost 5% in a couple hours and spot golds down only next to nothing . Unbelievable . At this rate we’ll get our $8-9 GDX in March

  49. pepe le pew

    Either that or this is a great opportunity to get on GDX; nervous sellers may regret if gold and silver are just resting before the next leg up. IF.

  50. crawford

    Why are you gents putting all your efforts in Gold. Gold is stuck in a range between 970 -1100 that’s it.
    Let us focus in the SPX instead, the $$$ is there.

  51. Walt

    50% of Americans are living paycheck to paycheck. If we really go down over the next couple of yrs and everyone loses their jobs because of low demand for goods /services , its going to be BAD out there.
    I wonder what Yellen and the financial leaders are thinking . They’ve got to know its going to get bad

  52. David Silver

    Local news downplaying Wall Street which I guess is good from a sentiment stand point if you’re a bear ??

  53. David Silver

    Elements of a crash in session:
    May bail out of longs (miners and NatGas)
    Keep my shorts on crude and US markets
    Got an hour to ponder this

        1. tulip

          David,
          thats who I thought you meant… Tim not Ted..
          I think he’s a sleeze… yrs ago he wouldn’t allow me to unsubscribe
          He finally did. I would be careful.. I don’t have a good word to say about him..

  54. AlexP

    David, I have a double short gold position ie, -2x, of 9% of my equity set right at session’s end.
    I will build on it gradually.

    Blue, David, yes, indeed SLP is great ๐Ÿ™‚

    Thus I am 20% SLP and 9% DZZ – short gold

  55. AlexP

    Gary, I do have no problem being stopped out.
    I be got stopped out of the 3 pilot positions I initiated on Wednesday – fb, stamp and lnkd – while the cumulated loss was -1.76% of my equity.
    I have not been stopped out of the pilot which I upgraded on Friday at position level, I.e. SLP play.

    Thus, you can see that even with 1 successful trade out of 4 trades and despite the blizzard of a muli-year cycle decline, one can manage to produce profit by recognizing from the start what stocks deserve to stay at a low pilot level and on which one(s) to build.

    PS: had the NYSE composite not crushed its 200wma, tomorrow I would invest further in SLP and buy FB, STMP as well as OFS – another great small cap – to the brim and skip the short gold trade, but my rules do not allow to by in a stocks bear rally.

    1. AlexP

      …sorry for the quality of my writing above…I wrote and write now from my tablet. I HATE THESE THINGS. I even do not have a smartphone, I can barely get the letters on a tablet.
      Samsung e1000 = best mobile phone in the world

    1. Will

      But, i believe this is just a “normal” profit taking thing…so, this baby will go higher sooner rather than later.

  56. Will

    $WTI is getting real close to its “quarterly” vertical support line circa $30-ish for a sizable bounce!
    And, by the way, energy companies are having a “post X’mas sales”…

  57. Will

    $SPX was trying to hammer into the close but ended up as doji instead…pointing to positive strength in Asian markets.

  58. Walt

    Is anyone watching the dollar index ?
    Its getting close to its level of upside resistance . It doesn’t look like it believes the move down in equities has legs .
    Unless its just topping here

  59. David Silver

    Gold:
    Previous 50 FIB held in early Jan aka 1056.10
    NEW 50 FIB should hold aka 1084.80
    Timely profit taking was expected
    Present danger is on gold’s side (imminent market crash/bear)
    Miner’s in another level
    Good times ahead

      1. Will

        SA – testing the WEEKLY vertical breakout level; no horizontal breakout yet at $10…and this baby looks likely to churn out a “reverse h&s” pattern on the weekly chart too…having exactly $10 as the neck-line!!!

        1. Will

          And, an ultimate breakout on WEEKLY vertical resistance + horizontal resistance + a head & shoulder bottom = Happy ending!

      2. David Silver

        Will did you see my last email?
        Anyway:
        Futures look bleak
        Shanghai flat
        Crude further to go sub $30 (looking for worsen capitulation than today)
        Will flip gears THEN
        Pro traders went long and US markets into close (boy will they be in for a shocker
        Why all the heros?
        What’s up with the USD?

      1. David Silver

        “WWW”……. ?
        What about “Ted it’s dead” ?
        They say:
        Buy the 52 week highs
        Short the 52 week lows

  60. Will

    Nikkei225…very ugly by breaking its weekly on 100D-EMA…so this is another make or break week for Jap. equities, given this is weekly chart.

    Aug 2015’s rout was salvaged at 100D-EMA;

    200D-EMA level is some -10% away!

    I reckon no decisive break-down here below 100D-EMA…not yet, not this month.

  61. David Silver

    NatGas sold off:
    Profit taking
    Coal kissing ? cousin effect
    HOWEVER overdone
    AND next best alternative hence her run up

  62. Will

    XAU (weekly) – It better close the week with a higher candle-stick, else, it will be a “harami”…will be bad in the latter case.

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