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Stock Market Surfing - Big S&P500 Waves

Surfing Wipeout

The S&P 500 Went South and We Cashed In Our Chips Video


Have you been riding's the big wave moves in the stock, futures, forex market lately? Big wave surfing can be like a casino and the stock market sometimes, you win some and you lose some. These last two weeks have been a wild and fun ride for some, and a total wipeout for others. Hows your investing trading waves been lately? If not so good, read on.

Last week the market tanked big-time, then last Monday stocks opened gap up. Back up just under levels that were support before and now are what looks like major resistance. Mostly a short covering rally I suspect. If the market is going to continue higher, it'll have to really prove itself and grind through the head and shoulders resistance now. If you do buy stock, buy the leaders not the laggards, and maybe you'll survive if there's another massive sell down, and or bear market trend forming.

If your in the bear camp, then more short selling time is possibly coming very soon now again it looks like. The sovereign debt crisis is not over, it's just starting, and it’s going to continue for many years. This either may or may not affect the global markets. Watch, see, and and optimize your portfolio. The ECB seems to be printing more money than the US Fed now. I see the dollar higher by the end of the year for sure. Its the lesser evil of all he evils right now, winner by default you might say.

Bull or bear, its even more important these days to be on the market to at least survive, and better, profit. Chance favors the prepared mind for maximum success.

This Free Market Convergence Report Can Help

The S&P index could easily be 1,050 or 1,000 by year-end, and the Dow could be 5000 or below by 2011. The weekly charts looks very negative for the markets. I wouldn't be surprised if oil gold and silver come down a bit also short term.

Click Here to Review S&P500 Long Term Video Analysis

Stock Market Surfing and Probabilistically Predictable

The financial markets are very similar to nature, and especially human nature which is what drives the markets. For example, when the ocean makes waves, its wave patterns are patterns that repeat over and over again. These patterns have predictability. If you surf, you know what I'm talking about, if you don't well your missing out. Go get a board and paddle out brudda.

The stock market is probabilistically predictable. This statement flies in the face of random walk theory and efficient market hypothesis, the two mainstream theories of market behavior that got thoroughly trased in the 2007-2009 crash. Today random walk is discredited and EMH is on the run.

What's behind market price swings, in the first place? I believe it's the collective feelings of market participants. They change constantly, but not randomly. Its Socionomic . . . social mood.

Human emotions . . . are rhythmical. They move in waves of definite number and direction. A completed move consists of five waves." R.N. Elliott, The Wave Principle Published 1938.

"Although Elliott came to his conclusions fifty years before the new science of fractals blossomed, the very idea that financial markets comprise specific forms . . . remains a revolutionary observation to this day, it has eluded other financial market researchers and chaos scientists." Bob Prechter, The Wave Principle of Human Social Behavior.

You see the "rhythm" of human emotion in this chart.

Eliott Wave Fractal
The astounding similarity between the two sets of the DJIA's price movements, one from 1921-1929, the other from 1974-2000, is not a coincidence.

"...markets are impulsive and patterned, not rational . . . they go through similar expressions of the same cycle of psychology over and over. The extent and duration vary, but the essence is always the same." Bob Prechter, The Elliott Wave Theorist, June 2006.

You can see the same patterns in nature itself:

Trees, for example, are branching robust fractals, as are animals circulatory systems, bronchial systems and nervous systems. The stock market record belongs in the category of life forms since it is a product of human social interaction.

R.N. Elliott discovered in the 1930s that this "human social interaction", as reflected by the stock market, is predictable because it forms similar patterns over and over again.

This order is not altered by the news. For example, as you may have read May 6 1000-point intraday drop in the Dow wasn't caused by the trouble in Greece or whatever, it occurred where the Elliott wave structure suggested it should have occurred.

What does the wave structure suggest about probable market action in the weeks ahead? Brace yourself, it may be a bumpy ride. Discover the revealing details today for free. Click here.

Click here for more Elliott Wave resources and commentary.


Disclosure: None