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JG Savoldi
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J.G. Savoldi is a graduate of Auburn University in Alabama where he majored in Criminal Justice Law. After graduation, Savoldi studied stock market history, Elliott Wave Theory, and everything he could absorb from conversations with market veterans--like fellow Alabama native Jimmy Rogers--and... More
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  • "Stretching the Tape"
    First of all I want to reiterate the BAM Model's prediction calling for a stock market crash.  I also want to reiterate it's prediction calling for a crash in crude oil taking that mkt back to/through 36 dollars per barrel into year-end.

    According to our model, we should see sharp downside moves in both of those mkts into Friday (October 9th) and, yes, we're sticking with our SPX target of 944.

    The BAM Model--as far as this bearish forecast is concerned is locked in place and there's nothing that will change the forecast.  Could it be temporarily wrong?  Sure.  But based on everything I'm seeing, I'm confident we'll be crashing very soon. 

    So what's with Monday and Tuesday's big rally?  (yes we've heard that a lot)

    Well...the bounce of the last two session was a necessary element if we're going to see a crash, in fact, all crashes experience a period of "stretching the tape" before the crash accelerates to the downside. 

    This stretching of the tape is a result of bulls and bears fighting it out and it's what creates the "resiliency" to pain which is what allows people to hang on to losing positions way too long which in turn forces the inevitable "capitulation" that comes at the bottom.

    By the way, this dynamic happens fairly frequently if you study fractal-level intraday charts.

    So could the market make another higher high?  Sure it could.  But I seriously doubt it will and if it were to occur, we'd be even more aggressive in buying November PUTS on the Nasdaq and Russell 2000 Indexes.  Is that reckless.  No, not according to our model.  According to our model, this is the time we must step up and follow its instructions.

    The "Set-up"

    This market 'set-up' has taken months and years to fall in place--as do all market crashes or melt-ups according to our work--and although the exact turning point can be tough to identify, I've never seen a single set up like this fail during the 90 years of stock market data I've studied.

    But what about all of this talk about "resiliency?"

    The stubbornness--many have been calling it "resiliency"--is exactly what is necessary to create a crash.  Think about it.  In order for a market to crash, you must have the majority on the wrong side of the trade. 

    By its very nature, a crash requires a boatful of investors on the "wrong side"--not simply a handful.

    One thing is certain.  We'll all know the answer to the October crash question soon enough.


    Oct 07 3:19 AM | Link | 1 Comment
  • BAM November 2007 Forecast of Crash to SPX 680 Magnet including $GM, $RIMM, $GS, $GOOG, $BIDU, $FSLR, $LM
    Monthly Archives: November 2007
    November 12, 2007

    -The stock market tracked the BAM model well last week as stocks suffered their biggest three day decline in five years with the NDX plunging in a “straight-line decline” to the 2056 magnet level just as anticipated.   But now, just as investors probably think it can’t get much worse, it has. 

    -Lets start by reiterating the bigger-picture BAM stock market forecast which points to a brutal 58% bear market decline into 2010 with the SPX round-tripping the entire 2002-2007 bull run before finding support into the SPX 680 level. 

    That’s right, regardless of election year cycles, the Olympics in China, emerging market strength, a possible interest rate easing cycle etc. etc. etc. our model is unequivocally ultra-bearish over the coming few years in fact it most closely resembles the set up we had during the 1929-1932 period. 

    During the 1929-1932 period—to dissect it a bit for you—started with a crash followed by a large bounce followed by a variation of mini-crashes and long grinding declines.   No two periods are exactly the same, but as I take a step back and look at our stock model, it has a very similar set of sell signals, future periods of weakness etc. as did the 1929-1932 period.  In fact, the only real difference between the 1929 through 1932 period is that the current set up actually looks MORE bearish in our work.  Maybe that’s impossible, and maybe it’s not but let’s just say I can honesty tell you all that this is the first time I’ve ever hoped our model is 100% wrong. 

    Individual Price Targets Also Confirming Model’s Bearishness 

    When we first started talking about the enormous real estate bubble in 2005, the BAM model was giving us what appeared to be absurdly low price targets for stocks like HOV, DHI, BZH, KBH, and TOL during what we thought at the time would be a huge real estate collapse into 2009.  Well, those absurdly low price levels now seem believable—because we’ve already reached most of them—and  we’re now ready to talk about some equally absurd price levels we think other stocks will see on either a crash leg or over time during the next several years.  This is just a small very random sampling but it should serve to illustrate what we see coming. 

    GM-6.00, possibly even 2.50, into 2009 

    RIMM-48.75-crash leg, 24.00 into 2009 

    FSLR-120 crash leg, 52 during 2008 

    GS-70 into 2009 

    GOOG-293 into 2008 

    BIDU-187 into 2008 

    LM-23 possible on crash leg or into 2008
    Oct 05 11:46 PM | Link | 1 Comment
  • The 1929 Stock Market Crash vs Current BAM Model Predictions
    The 1929 MARKET CRASH was key in building the BAM Model but what's it telling us about the current stock market?

    We depend 100% on our proprietary BAM model but we also try to keep our head up with regard to other interesting ideas.  After all, our model makes some of the most outrageous predictions from time to time--like telling us that crude oil would crash from 147 dollars to 36 dollars over a 12-18 month period back in 2008.

    Here we are again. 

    We're standing out on a limb here with our call for a 50% crash in the stock market over the coming 2-5 months and although we could have held that forecast to ourselves, we'd rather walk the talk by putting ourselves and our money on the line here.

    These are interesting times and although I'd love to be bullish and I'd love to be the guy bringing great news to the table, the model is the most bearish I have ever seen it.  This includes the readings at the all-time high in 2007 and it also includes the 2008 pre-crash readings we were seeing.

    I'll leave the fundamentals up to those who follow that discipline, but the BAM Model, as we saw so many times during 2007 and 2008, is predicting something that most seem unprepared for-- and we're going to follow it predictions.

    -Bearish stocks
    -Bullish Bonds
    -Bearish Crude Oil
    -Bullish USD
    -Bearish Gold

    Disclosure: we have positions reflecting all of these predictions
    Sep 30 1:14 PM | Link | 1 Comment
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