We now have a secondary peak with this SP500 daily chart, but this is not the real high! There are expanded patterns that constantly catch us by surprise, if we are not actively looking for them.
Our wave counts will be so far off course when we do not suspect any expanded pattern to be in progress. It’s also the biggest early indicator that stock markets are correcting with a Cycle degree flat, while gold is in a zigzag of the same degree. With the gold price crashing we know deflation is the issue, not inflation. The general markets will eventually act together or “hook-up” as all asset classes are going to deflate in price. During the 2008 crash gold, silver, gold stocks, oil and the general stock markets all crashed together for 8 intense months, while the US dollar index soared!
The exact same conditions in 2008 are present now, as the US dollar refuses to implode. The US dollar bear market ended in 2008 with a zigzag crash, so it’s in a bullish phase that very few USD watchers understand. It will be the huge corrections in this giant bull market that gold will perform moves that will shock us.
10,000 Boomers are retiring every day for the next 18 years so this will drain workers on a massive scale, and will no longer be producing in the economy. They will also be downsizing, and spend far less in the process. When they start to die, they will also be permanent sellers of real-estate and stock market holdings. Every western or developed country in the world has the same problem with Boomers disapearing on a massive scale. After every market crash a fertility crash gets reported a few years later which economist don’t even look at. When the future looks bleak, then raising a family will be the furthest thing from their minds.
This is the December gasoline futures chart and it had it’s last extreme peak back in May of 2018. In this case gasoline was leading the way in its bear market. A short zigzag that looks like a flat is very common in wave 2 bear rallies. I call them running zigzags just like a flat, as I use no “truncation” as an excuse why a certain zigzag did not extened any further. Zigzags also streach so long that it’s hard to believe it’s a zigzag. The 1929-1932 bear market had an extended “C” wave far exceeding anything in our EWP book. If it happens once in the real world, then I use it for all degree levels.
In any wave 2 rally situation we know that the Death Cross is just below present prices, with the 200-day MA just below the triple bottom support price. Gasoline prices are going to head south as gasoline is also in an Intermediate degree 4th wave bear market rally. All bear market rallies completley retrace themselves back too and below the point of orgin, which was in February 2016 at the $.90 price level.
You can read every single fundamental reason but fundamentals “ALWAYS” tell us the wrong things at the extremes! I always bet against any wave count that is just as bullish as the crowd is.
On the monthly chart the Death Cross has already happened with the daily chart next, and then the weekly chart Death Cross further down the road. Technically the Death Crosses are about as bearish of a set-up you will ever run into. Wave analysts, investors and fundamental analysts are basically oblivious to any Death Cross fact. Smart people have been using the 50-200-day MA since 1929 so it has a long history of forecasting huge bear markets.
This could take all of 2018 to play out, and my in-house indicators will start giving me feedback when the readings start to shift to the bullish side again. In this case not until wave 3-4-5 in Minor degree have played out. A deflationary, crash or depression-like conditions are coming, and the main reason is that an entire boomer generation is now retiring at a pace of 10,000 per day, for the next 18 years!
This will overwhelm any pension system as all “boomers” will be drawing on something that has no money in it! The government pension system is so underfunded that my boomer generation will suck it dry!
We are facing a dual H&S pattern which when found at major tops, is also very bearish! In addition to all this the gasoline weekly chart contains a rising wedge which is also about as bearish of a situation as we will ever run into. This doesn’t even include the massive gap still open below us, on the weekly charts.