If stocks have completed the 7 YCL then there are big implications for biotech, and commodities in the years ahead.


  1. jacob 2

    Agree. My personal plan. No recession, global growth followed by inflation. Market volatility masks massive sector rotation from U.S. medical and consumer sectors to producer and foreign stocks. Recently, added energy, materials, capital goods and emerging markets to existing buy and holds in gold, silver and diamond miners (don’t forget diamonds). The later group is currently experiencing a melt up the others will follow. This will be the new market leadership. It’s early, but out with the old in with the new (the way it always works). No company (a very good sign). An occasional trade but nothing much more to do. A 3 – 4year time frame. Sometimes it helps to write it down. Good luck.

  2. Gold miner

    I was thinking about that general market and PMS may rally togeather.Probably this time is coming, and PMS and bio will be the leaders this time, the best risk/reward

  3. Jorgy

    If your long your saying no recession and you’re betting that the FOMC is taking all rate hikes off the the table in 2016, that contagion in the high yield (bond) market hasn’t and won’t spread into other areas of fixed income (i.e. oil has bottomed) and that China’s not going to continue exporting deflation. The FDIC’s deposit insurance fund stood at $70 billion in Q5’15 while the Top 25 Holding companies had $250 trillion in dirivative exposure or 35X’s what the FDIC has to cover now that systemically too important banks have to be insured for this exposure too per the OCC’s Q3’15 report. We have a massive tsunami of credit defaults that will cascade through the global banking system if global GDP doesn’t pick up and pick up RIGHT NOW.

    Despite what Ben Bernanke said the FED has failed on their second mandate in getting 2% inflation. “… The US government has a technology, called a printing press (or, today its electronic equivalent), that allows it to produce as many US dollars it wished at essentially no cost. By increasing the number of US dollars in circulation, or even by credibly threatening to do so, the US government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can ALWAYS generate higher spending and hence positive inflation”

    Bottom Line: It’s a 50/50 bet whether we 1) have a determined government, 2) if the FOMC is scared enough (at this very moment and at these price market price levels) to execute a HELECOPTER DROP thereby increasing fiat in circulation, generating enough spending and inflation to outrun the GLOBAL DEBT MONSTER they and other global central banks created threatening to set off a $250 trillion derivative explosion! ?

    1. Jorgy

      Many think that just because global central banks have expanded their balance sheets in the last several years that we have to have some massive inflationary outcome. The truth is, we’ve already had a massive inflation in asset prices and the outcome that everyone thinks is sure to happen (i.e. Hyperinflation). Unfortunately, the market seems to be completely ignorant to the fact that a global debt default tsunami is threatening to sweep across the world over creating Hyperdeflation or the opposite of what everyone thought would happen given today’s setup. If you look at today’s setup and how asset prices are behaving you’ll see that staples, telecommunications and utilities have outperformed YTD and the bond market isn’t buying this countertrend rally in equities. No, the evidence is mounting that the bears are still in control and that the Yen Carry Trade will continue to unwind creating a cascade of margin calls on leveraged players. The reason why gold is rising in all fiat currency terms YTD is that a GLOBAL RESET is knocking at the door and global central banks/governments around the world are POWERLESS to stop it. Fiat will be devalued, promises will be broken and debt deflation, not inflation is a clear and present danger of the moment until HELECOPTER MONEY rains down on the globe! ?

  4. Dammendorf

    Bull Trap or Bottom in Gold and Gold Stocks? Look at:
    Lexam VG Gold &
    Sandspring Resources

    That’s not a bull trap!

  5. ted

    Gary, Saying the likelihood of a 7 year low in stocks is 50-50 seems disingenuous. It appears you are more inclined than not to believe it did happen last week. So why not say 60-40 or 70-30? Stick you neck out a bit on this one.

  6. ted

    BTW, a friend of mine gets Bob Brinker’s newsletter, and mentioned to me that Brinker sent out an alert to subscribers the prior Thursday that the low in stocks was in. FWIW.

  7. harry

    Gary, you say we have fifty/fifty chance of the 7 year cycle low, and I can just as easily say that we don’t. So what is one to do with this discovery???

    1. Gary Post author

      I told you exactly what to do in the vid. Buy long and place a stop right below 1812. You have a little over 5% risk if I’m wrong, and gigantic upside potential if I’m right.

      1. harry

        Then your recent devastating collapse into end of February is of the table Gary as the fed once again doesn’t follow the script you decided will happen.

    1. Gary Post author

      Absolutely, but as I keep saying, the Fed has a printing press so who knows they may have halted the rest of the decline.

  8. Anthonyo

    I would even say it is a 70-30 chance of PPT operation melt up rescue Episode 3(since October 2014 “V” shaped rescue, then August 2015, and now now) being in place.
    Bears dreaming wet dreams of SPX 1600 are doing just that, dreaming.

  9. Dave

    I don’t think we have seen the lows in the S&P 500 they are just delayed until the fall. I also don’t think we are in a 2008 situation either where we crash 50% or more. 2000 and 2007 tops could be were we stop. I also don’t think we have seen the bottom in gold, that could come this summer.

  10. Frank

    I think your thinking shows that 3 days of straight up action after a month of scary drops can turn the best of us from bear to bull (or 50/50 bull). This is what is needed to allow the next huge drop in the market. Good luck!

    1. Gary Post author

      Actually the force of those three days has rarely ever been seen in the last 50 years of stock market history. Three gap ups in a row. When similar surges have happened in the past they have led to big gains in the intermediate and long term. As long as the market holds onto the gains this week then the market has been higher a year later 16 out of 17 times by an impressive average of +21%.

      Like I said if this was just a bounce that was destined to roll over quickly it should have been much weaker. The move we got was extremely powerful indicative of big money flowing back into the market. Because it is so late in the 7 YCL I’m inclined to pay attention here, because this could be signalling the 7 YCL is over.

      The COT levels for the stock indexes is also showing an extremely bullish level. What do the biggest and most knowledgable traders in the world with massive research departments know that retail traders armed only with some charting software don’t?

  11. red

    The bigger picture is that as the virtuous disinflationary cycle turns down with equities here in the US, assets such as gold and silver that are tied to the direction of real yields – should once again outperform.

  12. ChrisG

    Gary how do you reconcile bubble phase against election cycles? Seems like market crash when new presidents comes in so that during his third to fourth year the market rallies big for him to get reelected.

  13. Stefan

    China is closest to a turnaround but it needs to correct another -10-15% thats good for workshop stocks.

    All other indexes looks bearish to me.

  14. Bud fox

    So which is it?

    Fed printing presses or the biggest and most knowledgable traders in the world?

    Gary said

    “Absolutely, but as I keep saying, the Fed has a printing press so who knows they may have halted the rest of the decline.”

    “The COT levels for the stock indexes is also showing an extremely bullish level. What do the biggest and most knowledgable traders in the world with massive research departments know that retail traders armed only with some charting software don’t?”

  15. Bud fox

    I can say with a higher probability of 50/50 that the bear market is not over.

    When price falls below the 10 month MA and RSI is below 50 you can see it has marked the beginning of the last 2 bear markets.


  16. Marco

    Why can’t you say what you think about the US$?
    Will it go up with stocks,gold etc….?
    What will be the currency to own for the next few years?
    The fate of US$ is not contemplated into your great analysis,but it would be great to know in a probable future world of negative interest rates,what to do even with currencies.
    I hope you will give all of us an idea on this very important topic.

  17. ChrisG

    Bud, if you look at 2011, market turn right back up. So even your proclaimed indicator failed. Bottom line…. Tis a fifty fifty market. We need more cards coming out of the deck

  18. Dave

    Looks like the SPX has formed a 3 white solders pattern. Definition
    Three white soldiers is a candlestick chart pattern in the financial markets. It unfolds across three trading sessions and suggests a strong price reversal from a bear market to a bull market. The pattern consists of three long candlesticks that trend upward like a staircase; each should open above the previous day’s open, ideally in the middle price range of that previous day. Each candlestick should also close progressively upward to establish a new near-term high.

    The three white soldiers help to confirm that a bear market has ended and market sentiment has turned positive. In Candlestick Charting Explained, technical analyst Gregory L. Morris says “This type of price action is very bullish and should never be ignored.”[2]

    The three white soldiers is one of the few candlestick patterns that I am proud to say I know. Yes, samples of the candle pattern are as rare as finding a $5 bill on the street, but it performs very well. It acts as a bullish reversal 82% of the time, ranking 3 out of 103 candlestick types, where 1 is best. When you consider that the close is awfully close to the top of the last candle in a series of three rising candles, the performance is not so good. For a downward breakout to occur, price would have to make a serious drop and plummet even more to push up the performance score. In fact, the high performance is due to just those factors: few candles with downward breakouts. Those with upward breakouts have lousy performance. So maybe I am less proud to say that I know the three white soldiers.

  19. pacoquin in spain

    Gary, from Spain.. IMO.. no way… just strong rebound… only if SP goes over 1970 or even 2000… would cancel H&S .. but China not done yet.. as well as many others.. rgds, Pacoquin

  20. pacoquin in spain

    .. however… Miners.. probably best investment in years.. although… still back and forth.. for a while … and of course…. oil.. that if now goes up to 39-40… shld go back to 29-30… and then.. yes !! IMO…

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