DJIA Intraday New Record High Update

After a choppy sideways move, the Mini DJIA stock bulls decided they had enough of that and then charged up in another little choppy leg to the upside. This sideways action can fit into a small triangle fairly well, but we may not end up with a big “trust”. The markets are generally getting weaker from a fundamental perspective. That doesn’t mean that the markets can’t push higher, as emotional investors can do amazing things when they catch bullshit fever.

At the time of this posting the DJIA had spiked to 24,986 already, and it could still take until noon PST  before a reversal may happen.

From the March 2009 bottom to our present top, the DJIA has seen a gain of 384%. Not bad considering the majority of experts just figured out that we were in a recession in 2009.

From 1921 to the peak in 1937, there were two 5 wave type bull markets, one gained 595%,  and the other gained 473%. Yet the majority never saw the bull market coming.

Even the expert wave analysts were still calling for DOW 1000 in early 2009, but yet the market turned and started to soar. The contrarians of the day were very bullish as insiders were already buying in late 2008. Insiders don’t buy their own stocks back on a “whim” and they sure don’t sell on a “whim”. It may take them years before they decide to sell again.

The last thing that will work is a bearish wave count after insiders have been buying for many months already. We just finished the bottom of  solar cycle #23 so the big bearish cry babies never had a chance, as all bearish wave counts were doomed.

The chart below is a bit old, but the end target for Cycle degree wave 3 position is still the same.

All the wave counting in the world will mean nothing if we have no clue from where we are counting from. Even though the majority of  wave counting failures has happened since 2000, none of the expert wave analysis went back to 1929 and started a new wave count. When we point our fingers to the wave that was in the middle of the depression, all we can see is a single spike to the downside. This was a wave 2 SC degree crash where the “B” wave counter rally lasted about 5-6 months.

This was a Cycle degree “B” wave bull market lasting a very short time, so I’m sure a “B” wave rally in Primary degree could even be shorter.

In the middle of the depression the market turned up and soared 473% in 5 years, completely ignoring all fundamental conditions at that time. The market also did this in 2002 and again in 2009. Bull markets end when the majority have contracted “bullshit fever”. Only the completely brainwashed bulls love to buy high, and sell higher. The smart money has left the building a long time ago and they will not be back until they see their company’s prospects are going to turn around.

The Gold/Dow ratio helps in determining how expensive the markets really are. This morning we were at about 19:1 which is a bit below the average for December of 2017. It takes 19 gold ounces to buy one unit of the DOW, and we would need to get closer to an 8:1 ratio before the DJIA becomes cheap again.

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