Weekly Update & Summary: April 19th, 2014

In a complete reversal from last week’s loss of 386 points the Dow Jones gained 382 points (+2.38%) and the Nasdaq gained 98.78 points (+2.39%) for the week. Structurally, while the Nasdaq closed all of its gaps, the Dow left two gaps behind, on Monday the 14th and a large gap on the 16th. Indicating an upcoming correction. Further, there are a number of smaller gaps left leading all the way down to February 5th low. The Dow will close such gaps as the bear leg develops at below mentioned time frames (please see mathematical analysis & timing section below).

WEEKLY REVIEW:

Asia’s Wealthiest Man Is Selling Everything In China. Crash Coming?

With his net worth well in excess of $30 Billion, Li Ka-Shing is the richest man in Asia. A shrewd property investor, Li made most of his billions by investing in Chinese property market. Yet, unbeknownst to most, Li has been liquidating most of his property holdings in China since last year. With recently completed sale of Pacific Place shopping center in Beijing for $928 million, Li now has no assets of significant value left in or exposed to the Chinese market.

So, what does Li sees that has caused him enough concern to liquidate most of his holdings?

Same thing that we have mentioned on this blog.( Where Is China’s Hidden Debt Bomb) China is on a verge of a massive credit seizure that should (in theory) collapse it’s real estate, banking, shadow banking, capital missallocationg and credit bubbles. When it does, you will see China go through a massive economic slowdown and a possible revolutionary regime change. While most people will dismiss this view as highly improbable (anticipating a soft landing at best), Asia’s richest (and arguably the smartest) man just voted with his wallet. As they say, money talks and bullshit walks.

In fact, watch Li buy his Pacific Place mall back for $100 Million within the next 5 years.

Baltic Dry Collapses 40%. Signals Economic Slowdown.

No, Baltic Dry is not a tasty Swedish Beer. Baltic Dry Index, a measure of sea freight prices, is now in a technical bear market. Signaling a worldwide economic slowdown. Down 40% in just three weeks and a bone crushing 58% since it’s December 2013 top. This works well with our overall bear market of 2014-2017 forecast. But don’t worry, as mentioned earlier, according to the talking heads on TV the market has bottomed and the Nasdaq is going to 5,000. BUY, BUY, BUY. Cheers.

Janet Yellen: Bubbles? What Bubbles?

As per Bloomberg report below, Janet Yellen said nothing about the risk that her easy monetary policy will inflate asset bubbles. DUH!? What Bloomberg has missed is that we are already in a massive bubble or bubbles. While the primary bubble is singular in nature….CREDIT……adjacent bubbles are too numerous to mention here (stock market, real estate, bonds, car loans, student debt, etc…) In fact, the situation we face today is not that dissimilar to the situation we have faced at 2007 top. It is almost identical and I challenge anyone to prove me otherwise.

Is the FED aware of these bubbles while hoping for the best or are they completely blind? Unfortunately, I continue to maintain it’s the latter. As I have mentioned before, their 2008 FED Minutes is a clear indication of that. They are a reactionary force at best, only able to correct the direction after the fact. Somehow, the markets believe that the FED possesses a supernatural power to control and to direct the markets. And that is why I continue to maintain that the market participants with such a view will pay dearly for their misconception over the next few years.

MACROECONOMIC ANALYSIS:

Ukraine/Russia/USA/EU/NATO continue to be the most important issue. In fact, I continue to believe things will escalate significantly over the next few weeks.

While things seemed to cool off and the Geneva deal was signed, I continue to believe the US/NATO, Ukraine’s Interim Government, Pro-Russian Movement In the East Ukraine and Russia are one spark away from reigniting this conflict and going at each other on multiple levels. While I don’t believe NATO and Russia will get involved into a direct military conflict (for the time being), any misstep here by either side might lead to Russia invading East Ukraine. In fact, I continue to believe it is just a matter of time. Such a move by Russia will spark a number of economic sanctions (from both sides), political storm, war rhetoric and a million other unforeseen consequences. As you can imagine, this would be incredibly unsettling for financial markets. The upcoming week is critical.

TECHNICAL ANALYSIS THE FOR DOW JONES:

Long-Term: The trend is still up. Market action in January-February could be viewed as a simple correction in an ongoing bull market. Same applies to the market action over the last two weeks. Yet, that in itself can be misleading as per our timing analysis discussion below.

Intermediary-Term: Since February 5th, intermediary term picture shifted from negative to positive. Giving us a technical indication that both the intermediary term and the long term trends are up. Yet, that in itself can be misleading as per our timing analysis discussion below.

Short-Term: Short-term positive trend is at the risk of a reversal. If the Dow breaks below 16,000 in the upcoming week(s), short-term trend will shift from positive to negative. So, while the short-term trend remains bullish for the time being, it might be misleading as per our timing analysis discussion below.

Again, even though all 3 trends are bullish for the time being, that might be misleading. Please read our Mathematical and Timing Analysis to see what will transpire over the next few weeks.

MATHEMATICAL & TIMING ANALYSIS:

First, a recap. Particularly for our new subscribers. Over the last few months we have maintained that the DOW will set a XXXX

(*** Please Note: This time around about 90% of the information contained within this section has been deliberately removed as it contain too much technical information. Particularly, exact dates and prices of the upcoming turning points. As well as trading forecasts associated with them. I deem such information to be too valuable to be released onto the general public. As such, this information is only available to my premium subscribers. If you are a premium subscriber please Click Here to log in. If you would be interested in becoming a subscriber and gaining access to the most accurate forecasting service available anywhere, a forecasting service that gives you exact turning points in both price and time, please Click Here to learn more.Don’t forget, we have a risk free 14-day trial).

…XXXX

In conclusion, our timing and mathematical work shows XXXX

Longer-Term Overview:

Date: XXXX
Price: XXXX

Trading:

XXXX

The list below is for your reference point. It entails my investment strategy for my own investment purposes. While you are free to follow me, please do so at your own risk. Do not take this as a trading advice. Please note, all of the positions below have been triggered.

Stock	Entry Point ($)	Action Taken	Stop Loss @
XXXX	XXXX	Went XXXX	XXXX
XXXX	XXXX	Went XXXX	XXXX
XXXX	110	Went XXXX	121-123
XXXX	74	Went XXXX	80
XXXX	236	Went XXXX	260
XXXX	XXXX	Went XXXX	460
XXXX	35	Went XXXX	39
XXXX	65	Went XXXX	70
XXXX	120	Went XXXX	120-130
XXXX	100	Went XXXX	108-112
XXXX	112	Went XXXX	120

Otherwise, I suggest the following positioning over the next few days/weeks to minimize the risk while positioning yourself for a forecasted market action. (This is continuation of our previous positioning).

If You Are A Trader: XXXX.

If No Position: XXXX

If Long: XXXX

If Short: XXXX

CONCLUSION:

An incredibly important week is coming up. We are now looking for our forecasts above to be confirmed over the next few trading days/weeks. I have also described what to anticipate over the next few months and exactly what you should do now. With increased volatility, multiple interference patterns and an incredibly important long-term turning points coming up over the next few months we must be very careful and risk averse here. Those anticipating the moves and those who can time them properly will be rewarded appropriately.

Please Note: XXXX is available to our premium subscribers in our + Subscriber Section. It’s FREE to start.

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!