There are numerous indications that the stock market reached a significant low at the 8000 mark. The market is substantially oversold, the VIX or fear index peaked at a historic high of 80 and now the credit crisis is easing as indicating by the falling TED spread.
Even with these signs of a bottom, one should be alert to the possibility of the panic resuming in the days ahead with a selling climax being reached this Friday or Monday of next week. The reason this is so is an important phenomenon identified by Chris Carolan regarding autumn panics on Wall Street.
Chris Carolan, as explained in an award winning article, discovered that the 1929 and 1987 stock market crashes climaxed into the 28th day of the 7th lunar month in those respective lunar years (where the lunar year begins with the first new moon after the Spring equinox).
The 28th day of the 7th lunar month this year occurs on October 26th. Since this is a Sunday, one would look for a panic climax into this Friday or next Monday, accordingly. While I have long been warning that the "Grand Supercycle Crash" could ultimately take the form of global war, I seriously doubt this will unfold in the next few days. What is possible is that black crash days will occur on Wall Street.
No comments:
Post a Comment