Ian Woodward's Investing Blog

Stock Market: The Market Index Cliff

I am in the thick of writing the Monthly HGSI Newsletter, but here is my Summary Overview which I hope will encourage you to get a Free Trial of the Software and the Newsletter.  My friend in India who recently got the software is telling all his friends what they are missing, and I can see my friend in Qatar is also cooking up a storm in anticipation of what is to come.

Overview: 

We had an exhilarating three day Seminar, learned a lot from each other and had good fun.

This Month’s Picture shows you the focus I have given you on the Market Index Cliff and described in my most recent three Blog Notes starting on November 7th.  This Month’s Newsletter develops the story around this picture and shows you how we can get the earliest warning that trouble is brewing by understanding the implications of the Woody Indicator:

The $64 question is “Do the Floodgates Open Wide and Panic Sets in or do we get a Big Bounce Play to stem the tide?” So far it has been a drip-drip process down and it is Ugly.

Besides discussing the High and Low Road Scenarios, my theme for this month explains in detail the logic and results for identifying impending Market Cliff Hangers and when to protect your Nest Egg when the signs are more than a passing small correction.

Ron will devote his piece to One Step Scorecard Views, as those attending the Seminar enjoyed when Paul Reiche suggested this was a fruitful way of ferreting for worthwhile candidates. The Round Table discussion is on Tuesday, 20th October at 4.30pm EST, where we will as usual expand on the ideas in the newsletter.

Best Regards,

Ian.

 

2 Responses to “Stock Market: The Market Index Cliff”

  1. Tom H Says:

    Hey there Ian-
    I personally find the term “Fiscal Cliff” to be very misleading. The concept taken is that once one “goes over the cliff” one can not return, hence on Jan.1, 2013 the US is in immediate recession and doomed. Nothing could be further from the truth. Noted economists have observed that the economy would only begin to see effects of this (in) action in 3 or more months.

    What we are seeing in the market is fear. But that human emotion is all that’s necessary for a tumble and perhaps a terrific buying opportunity in a few weeks. Why? No political party wants the stigma of placing the economy into recession, Grover Norquist or not. The public will demand that a solution is found well before any affect is reached.

    My personal recommendation is to be watchful now for signs of recovery. As you so carefully pointed out in these pages in mid-October, that was the time to exit or hedge; it’s a little late right now. As always, keep up the research and commentary, good stuff ! And for those who have not attended at least one bi-yearly seminar, I would recommend doing so in the new year. Well worth the time and efforts as Ian & Ron do a great job.

    Cheers and Happy Thanksgiving to all. ……. Tom …….

  2. ian Says:

    Many thanks for your feedback, Tom. Yes, for sure the buzz words are taking control and I am guilty of adding to them with “Market Index Cliff”. I wanted to make the distinction that it is preceding the Fiscal Cliff by several weeks and may well be over before January 1 comes around.

    Many moons ago I coined the term “12 Drummers Drumming” and suggested that within 12 to 16 days the cycle turns. Dr. Robert Minkowski’s latest work has it at 17 days at this stage, and with the tepid Bounce Play on Friday, it might well be that we have turned the corner.

    I hope you will be able to attend the Roundtable which is being offered as a one time promotion to anyone interested and will be on this coming Tuesday at 4.30 pm EST. You will find that I am on your wavelength, and the key right now is the change in Bandwidth. If it exceeds 0.10 for most Indexes watch out below, but if it trundles back down to 0.05 (say) and goes quiet again we may well have the rally we should expect if this is just an oversold situation. You tigers keep me on my toes!

    Best Regards,

    Ian.

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Disclaimer: Commentaries on this Blog are not to be construed as recommendations to buy or sell the market and/or specific securites. The consumer of the information is responsible for their own investment decisions.