New Year: New Economic Boom? Why 2010 Should Be One to Remember
by ilene - January 24th, 2010 11:17 pm
Elliott Wave International’s report puts 2010 into Elliott Wave perspective. The 13-page report is available for free download now. Learn more here. – Ilene
New Year: New Economic Boom? Why 2010 Should Be One to Remember
By Nico Isaac
In the realm of market psychology, there’s a big difference between optimism and extreme optimism. The first is seeing the glass half full. The second is seeing the glass half full deep in the heart of a bone-dry desert. In finance, it’s what we call "Buying the Dip" mentality — when all outcomes, even losses, are cause for celebration.
We are there now.
To wit: With a new year upon us, the mainstream has already come up with a fresh tagline to define the next 360-or so days. It even rhymes: The Bull Runs Again In 2010. This projection is in no way "in spite of" the fact that the U.S. stock market just finished its first decade of negative returns since the Great Depression; it’s because of that fact.
See, according to the mainstream experts, this "Lost Decade" of abysmal stock performance (in which the Dow ended 9% in the red, the S&P 500 – 24%, and the NASDAQ Composite – 44%) is the very foundation on which a new bull market will apparently be born. One economic scholar recently coined the phenomenon the "Slingshot Effect" — the more severe the downturn, the faster the recovery. (Associated Press)
Adding to the upbeat chorus are these recent news items:
"The horrible decade has wiped out all the excesses of the previous two decades and put us back on track for more normal returns." (USA Today) — AND — "It may be the best of all possible worlds." (Business News)
Back in the late 1990s, when the "unstoppable" NASDAQ began to experience regular days of double-digit drops, it was "Buy-the-Dip." Now, it’s "buy the entire lost decade." And, as the Dec.31, 2009 Elliott Wave Financial Forecast Short Term Update reveals — current sentiment readings "continue to show that stock market bears have packed up and moved to Florida for the winter."
The Dec. 31 Short Term Update also reveals two mind-blowing charts of the S&P 500 versus Investor Intelligence Advisors Survey Percentage of Bears — AND, the S&P 500 versus the percentage of "Fully Committed" bullish advisors since 2000. The current reading…
Robert Prechter’s Report: 2010
by ilene - January 20th, 2010 1:14 pm
Elliott Wave International is offering a free report on Robert Prechter’s outlook for 2010. Here’s what they have to say--essentially, permabear Prechter did not turn into a bull last March; he’s a still a bear, and now the hibernation is over. – Ilene
Robert Prechter’s Report: 2010
Recall the prevailing investor sentiment from this time last year …
U.S. stocks had been in strong decline for more than a year. Some of the most celebrated bulls had turned into bears, and the few bears that did exist before the downturn had become even more bearish. The Daily Sentiment Index for the S&P registered an astonishing 3 percent bulls — virtually no one was betting on the upside — and the bleakest of forecasts for 2009 called for nothing short of financial apocalypse.
But well-known contrarian analyst Robert Prechter took the opposite side of the trade. Prechter, a long-time bear, emerged as a bullish voice among overwhelming bearishness:
"The market is compressed, and when it finds a bottom and rallies, it will be sharp and scary for anyone who is short."
In the following days, the mainstream media reported that "perma-bear" Robert Prechter had turned bullish — the reports were only half true. Prechter had, in fact, turned intermediate-term bullish, but he stopped short of recommending average investors to jump back in. Why?
Prechter saw something on the horizon that the shortsighted mainstream market watchers did not, which brings me to the untold portion of this story …
In Prechter’s eyes, the bear market is far from over, and what he expects to happen after the current rally ends is significantly important to how you position your portfolio now.
Download "The Most Important Investment Report You’ll Read in 2010." Inside, Prechter reveals his big-picture outlook for U.S. stocks and the U.S. economy. He examines the government’s unprecedented involvement in the financial markets and private enterprise.
Learn more about and download the free 13-page Most Important Report for 2010 now.