A Systematic Trader's Journal

Free Elliott Wave Principle

2009-07-17T10:56:00.000+08:00

The Versatility of The Wave Principle
In this classic Elliott Wave International educational video, Chief Commodity Analyst Jeffrey Kennedy demonstrates the versatility of The Wave Principle by showing you how to identify high-probability trade set-ups at-a-glance, and in any market. Watch the video and then find out how to access Jeff's current high-probability commodity forecasts FREE during EWI's FreeWeek - but only until July 22.

The Versatility of The Wave Principle

Get the best daily commodity picks FREE, but only until July 22!

Free Video and Elliott Wave Premium Access for Forex

2009-05-14T12:39:00.001+08:00

Greetings,

Our friends at Elliott Wave International have just announced the beginning of their wildly popular FreeWeek event, where they've thrown open the doors to some of their most popular paid services to non-subscribers for one week only.

You can access EWI’s intraday and end-of-day Forex forecasts right now through next Wednesday, May 20.

This unique opportunity only lasts a short time, so don't delay!

Learn more about EWI's FreeWeek here.

This video features Elliott Wave International Senior Currency Analyst, Jim Martens, using Elliott wave analysis to forecast the U.S. dollar's near-term moves.

Now through May 20, you can access all of Elliott Wave International's intraday and end-of-day Forex forecasts completely free. Access EWI's FreeWeek.

Get all of Jim Marten's intraday and end-of-day Forex forecasts FREE through May 20. Access EWI's FreeWeek.

Think That Central Banks Move the Markets? Think Again

2009-04-25T01:24:00.000+08:00

April 23, 2009

By Mark Galasiewski

The following is excerpted from Elliott Wave International’s Global Market Perspective. The full 120-page publication, which features forecasts for every major world market, is available free until April 30. Visit Elliott Wave International to download it free.

Conventional wisdom says that central banks can influence or even direct financial markets and the macroeconomy. The very existence of Elliott waves challenges such assumptions. For if markets responded to every central bank directive, how could Elliott waves exist? Parallel trend channels, Fibonacci price relationships, the similarity of form between waves of different sizes and time periods—none of that would be possible. Central bank decisions would have to coincide perfectly with turning points in Elliott waves, and we know that just doesn’t happen. But even without using waves, we can expose the conventional wisdom for the fallacy that it is.

Take, for example, this assertion in a recent article in a U.K. economic weekly: “Part of the aim of central banks in driving down interest rates is to encourage a greater risk appetite among investors.” Two key assumptions underlie that statement: a) central banks determine interest rates; and b) lower interest rates can increase society’s appetite for risk.

To see how the first assumption is false, let’s take a look at the daily chart of Australian interest rate data. It duplicates a study that Elliott Wave International has often done with U.S. interest rate data. It shows how movements in the cash target rate set by Australia’s central bank, the Reserve Bank of Australia (RBA), appear to follow those in 3-month Australian Treasury Bills. After decisive moves up in T-bills from 2006 to early 2008, for example, the RBA faithfully raised its target. T-bills have since led the RBA during the financial crisis of the past year. In fact, the record indicates that the RBA almost always follows T-bills over time.

The proper conclusion to draw is not that the RBA has orchestrated the decline in rates since the early 1980s—but that it’s been riding it. During good times, central bankers look like geniuses; during bad times, they get tarred and feathered. Closer to the truth is that their interest-rate decisions are not proactive, but reactive, and that they continually follow in the footsteps of the market for lack of any other useful guide.

Now let’s look at the second assumption: that lower interest rates increase society’s appetite for risk. A simple glance at the weekly chart shows this assumption to be false. After the 1987 crash, the ASX All Ordinaries actually rallied for two years on rising rates and then sold off through 1990 on falling rates. Stocks then rose in 1991 on continued falling rates and sold off in 1992 on even lower rates. Continue following the chart to the right and you will see that there is no consistent correlation between the direction of interest rates and that of the stock market.

The myth of central bank potency is so pervasive that conventional analysts can’t even imagine a better explanation for price trends: that the market is the dog wagging its central bank tail, not the other way around.

For more information, download Elliott Wave International’s FREE issue of Global Market Perspective, available until April 30. The 120-page publication covers every major world market, global interest rates, international currencies, metals, energy and more.

Mark Galasiewski is the editor of Elliott Wave International’s Asian Financial Forecast and member of EWI’s Global Market Perspective team covering Asian stock indexes.

FreeWeek: Elliott Wave GMP

2009-04-20T12:11:00.003+08:00

Greetings friends,

Long time no see.

Once each year or so, our friends at Elliott Wave International will offer free premium elliott wave access to their reports and analysis. So this is the time again.

This time, they are offering the public more than 100 pages of free analysis and forecasts on every major world market. EWI is giving away one month of its most popular global analysis publication, a 120-page "little black book" of investment insights called Global Market Perspective, which includes EWI's three regional publications:

The U.S. Elliott Wave Financial Forecast ($19/month value)
The European Elliott Wave Financial Forecast ($29/month value)
The Asian-Pacific Elliott Wave Financial Forecast ($31/month value)

PLUS, the 120-page book includes analysis culled straight from EWI's professional-grade Specialty Services, each of which is valued at $199/month. This means you also get analysis and forecasts for the following global markets:

World stock markets (China, Japan, Korea, U.S, France, Britain and more)
Global interest rates (Australia, Europe, Japan, U.S.)
International currency relationships (U.S. Dollar, Euro rates, Swiss Francs, Japanese Yen and more)
Metals and Energy (Crude Oil, Gold, Silver, Natural Gas)
And so much more!

Learn how to get your free 120 pages of global analysis here

I would greatly recommend this because, in my opinion, such proprietary materials could hardly be accessed with no charge, so make good use of this opporunity to learn from the pioneers who brought the concept of elliott wave theory to the world.

Asian Comic: During bad times

2009-04-11T13:01:00.003+08:00

Nice Asian styled comics

List of AIG counterparties

2009-03-16T23:35:00.002+08:00

AIG is today's biggest news, as they list which institutions were beneficiaries of the US bailout fund and their request to pay employees $165 million on bonuses and trading partners. Click here for details.

Additionally to AIG, here is a document that displays AIG's biggest counterparties on their CDS.

A.I.G.'s Biggest Counterparties

Publish at Scribd or explore others: Government Business & Legal american internation A.I.G.

Video: Ben Bernanke's Interview on CBS

2009-03-16T23:34:00.001+08:00

This is the controversial video that Wall Street participants are discussing about. Be reminded, this is the first time a Fed Chairman accepts a personal TV interview while in office. Enjoy..

6 Questions You Should Be Asking About the Financial Crisis (And 6 Must-Read Answers)

2009-03-14T15:18:00.006+08:00

Elliott Wave International, the world’s largest market forecasting firm, receives thousands of questions every year from web site visitors and subscribers on their free Message Board.

Here the company shares 6 of the recent critical questions on the financial crisis and 6 answers provided by their professional analysts.

For more free questions and answers or to submit your own question, visit Elliott Wave International’s Message Board.

Q: Can increased government spending help stop the crisis?

What do you think about the new mortgage bailout plan – or bailouts and proposals for additional government spending in general? The opinions on whether or not this will ultimately work seem so divided...

Answer:

In Ch. 13 of his Conquer the Crash, “Can the Fed Stop Deflation?”, Bob Prechter writes; quote: "Can the government spend our way out of deflation and depression? Governments sometimes employ aspects of' 'fiscal policy,' i.e., altering spending or taxing policies, to 'pump up' demand for goods and services. Raising taxes for any reason would be harmful. Increasing government spending (with or without raising taxes) simply transfers wealth from savers to spenders, substituting a short-run stimulus for long-run financial deterioration. Japan has used this approach for twelve years, and it hasn’t worked. Slashing taxes absent government spending cuts would be useless because the government would have to borrow the difference. Cutting government spending is a good thing, but politics will prevent its happening prior to a crisis. ... Prior excesses have resulted in a lack of solutions to the deflation problem. Like the discomfort of drug addiction withdrawal, the discomfort of credit addiction withdrawal cannot be avoided. The time to have thought about avoiding a system-wide deflation was years ago. Now it’s too late. It does not matter how it happens; in the right psychological environment, deflation will win, at least initially."

Q: In deflation, what's best: to have no debts or preserve capital?

During a deflationary period, if you had to choose one or the other – debt reduction or preservation of capital – which one is MOST important?

Answer:

In Ch. 29 of Conquer the Crash, "Calling in Loans and Paying off Debts," Elliott Wave International’s founder and president Bob Prechter writes; quote: "Being debt-free means that you are freer, period. You don’t have to sweat credit card payments. You don’t have to sweat home or auto repossession or loss of your business. You don’t have to work 6 percent more, or 10 percent more, or 18 percent more just to stay even. ...the best mortgage is none at all. If you own your home outright and lose your job, you will still have a residence." Of course, one could pay off some debts AND keep some capital – it all depends on an individual's risk appetite and tolerance.

Q: Which news and events can move the market and which can't?

I've noticed that a lot of times, the stock market does the opposite of what the news suggests it should do – or does nothing at all. Can you make a distinction, if there is one, between news that does not move the market and the news that does? I'm talking specifically about the news and anticipation of another bailout plan plus stimulus package that is supposedly rallying U.S. stocks right now.

Answer:

The subject of the news is almost irrelevant. What IS relevant is the state of investors' collective mood at the time of the news release. If they feel bullish (or bearish), they will interpret just about any news story as bullish (or bearish) too. (Or "dismiss the news," as financial commentators often put it.) If you need a good example, just compare the February 6 horrific U.S. jobs report with that day's rally in the DJIA. Or, contrast the February 10 passage of the "$838 Billion Economic Stimulus Package" with a 300+ drop on the Dow. The important thing to keep in mind is that while the news can cause short-term price spikes, it has no effect on the longer-term trend; only social mood does.

Q: If this deflation deepens, will the US dollar crash?

Bob Prechter’s Conquer the Crash and your monthly publications like Bob’s Elliott Wave Theorist, you've been saying that in deflation, "cash is king" as the value of the dollar rises. But won't the U.S. government's spending spree cause the dollar to crash instead against the euro and other currencies?

Answer:

It's very important to make a distinction between the dollar's domestic and international values. In a deflation, the value of any currency – the U.S. dollar, in this case – rises domestically: As asset prices fall, each unit of currency buys more domestically-available goods and services. "Cash is the only asset that assuredly rises in value during deflation." – Bob Prechter, Conquer the Crash, Ch. 18. However, the USD's international value (as represented by the U.S. Dollar Index) in a deflation can rise OR fall relative to other currencies. If, for instance, the euro is deflating faster than the dollar, then the dollar's value relative to the euro will rise, and vice versa.

Q: Won't government bailouts turn deflation into inflation?

Trillions of dollars in bailouts "injected" into the economy – won't they reverse deflation and turn it into inflation instead?

Answer:

Here is a quote from Bob Prechter’s October 2008 Elliott Wave Theorist: "Believers in perpetual inflation think that the government can keep assuming others’ bad debts infinitely. But it can’t. The only reason that Congress has gotten away with issuing this latest blizzard of new IOUs is that society is still near the top of a Grand Supercycle, so optimism and confidence still have the upper hand. But as pessimism and skepticism continue to wax and the economy contracts, the bond market will figure out that the Treasury will be unable to fund all these obligations with tax collections. Then Treasury bond prices will begin falling as if they were sub-prime mortgages. A collapsing bond market is deflation; it is a contraction of the outstanding credit supply. Recent bailout schemes will not reverse the deflationary freight train. They will serve only to confuse the marketplace and hinder the efficient retirement of bad debts, thus exacerbating the crisis and aggravating investors’ uncertainties and thereby falling right in line with the declining trend of social mood."

Q: When will recession end – and DEPRESSION begin?

When do you think the economic DEPRESSION will officially begin?

Answer:

It took mainstream economists over a year to recognize the "official" start of the recession! Because a depression is a much bigger and rarer event, the delay with its "official" recognition will likely be even greater. Not to mention the fact that, interestingly, there is no "official" definition of a depression; even if there were one, ours here at Elliott Wave International would probably differ. Rest assured, though: We intend to update subscribers on any "progress" in that direction.

To read 30+ additional questions and answers on the financial crisis, investing, capital safety and more, visit Elliott Wave International’s free Message Board.

Elliott Wave International (EWI) is the world’s largest market forecasting firm. EWI’s 20-plus analysts provide around-the-clock forecasts of every major market in the world via the internet and proprietary web systems like Reuters and Bloomberg. EWI’s educational services include conferences, workshops, webinars, video tapes, special reports, books and one of the internet’s richest free content programs, Club EWI.

Video: Do not underestimate the power of printing money

2009-03-10T14:38:00.001+08:00

Hi all,

Just got this on Mr Marc Faber, Dr Doom, where he speaks on the power of printing money. Enjoy..

Video: Buffet on Taxes

2009-03-09T21:27:00.000+08:00

Video: Warren Buffet on Bailing the Big Three, Deals & Investment Opportunities, and Finding the Right Solution

2009-03-09T21:14:00.001+08:00

Video: Warren Buffet's Advice for the Administration

2009-03-09T21:03:00.003+08:00

Interesting insights for the administration. He thinks President Obama is the correct person for the job. But probably has to be very careful with some use of words there, stating from his earlier interview.

Just in case you are confused with the sequence of the videos posted, you check the sequence by looking at the time-stamp, on the lower left corner of the video player. It will look like .

Enjoy the video..

Video: Warren Buffet on Crooks and Investment Advice, and Investment Regrets

2009-03-09T20:05:00.004+08:00

Here are another 2 more videos:

Video: Warren Buffet says banks should get back to banking

2009-03-09T19:43:00.000+08:00

Here is the next part:

Video: Warren Buffet on email Q&A

2009-03-09T19:37:00.000+08:00

Here is a short email Q&A that the legendary investor answered over TV.

Video: Warren Buffet says Fear Affects Everyone

2009-03-09T19:18:00.001+08:00

Here is part 2 of this video:

Video: Warren Buffet says U.S economy has fallen off a cliff

2009-03-09T19:12:00.000+08:00

Hi all,

This is part 1 of Warren Buffet's interview. Given Warren Buffet who has been traditionally been a conservative and 'practical' investor, his views could be a good insight for many.

Enjoy..

Video: Jim Rogers on Agriculture and China (5th Mar 09)

2009-03-05T16:08:00.002+08:00

Here is another video where Jim Rogers talk about why he feels farming, agriculture, and China would be where he would want to put his money on.

Give me your views.

Video: Jim Rogers 5th Mar 09

2009-03-05T15:17:00.004+08:00

Hi all,

The clip below is another video featuring Jim Rogers's views on the ECB and BOE rate decision.

We continue to look out for interest rate changes in ECB and BOE in the next hour. ECB (released at 11am GMT) consensus 50bps, previous release, unchanged. BOE (released at 12:45am GMT) consensus is 50bps. US Jobs claims will be of focus after the rate announcements from out UK and European counterparts. For further details of today's announcement, scroll down to the bottom of the page view the economic calendar.

Enjoy the video..

Report: Warren Buffet's 2008 Performance

2009-03-04T19:03:00.003+08:00

Hi all,

If you have been a loyal follower of Warren Buffet, I am sure the following report on Berkshire Hathaway's 2008 Annual Report would be of interest to you.

Berkshire Hathaway's per share book value shrank 9.6%, which was the largest decline since 1965. The company which he owns the largest percentage portion of company ownership is The Washington Post Company, where he owns 18.4% of the company, which he invested US$11 million in it, and its current market value as of 31/12/08 was worth US$674 million. Largest investment cost to date, US$7 billion on ConocoPhillips where he owns 5.7% of it, and its current value as of 31/12/08 was worth US$4.39 billion.

I love the way how Warren Buffet pans out his letter. He made an explanation on the way how an option worked and his argument towards the Black Scholes Formula. The 22- page letter is considered to be one of the best article I had read from him. To access the article, click here.

Post me your views after you had read it.

Video: President Obama and Brown on the Economy

2009-03-04T18:02:00.002+08:00

President's Obama's comments in the clip below has raised some views and comments over in the Asian markets. There were discussions made as to why he had to bring up the issue that valuations and price to earnings ratio for many stocks was a good deal now if there's a long term perspective on it.

Well in my opinion, I guess it is just a very logical explanation as to how good the opportunity it is to be trading with the U.S now, and the potential of investment growth should anyone place investments in the U.S.

Watch this interview yourself and tell me your views.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Video Link and Summary of Senate Banking Committee Testimony

2009-03-04T03:06:00.002+08:00

Took some time to watch the testimony earlier. It started with some intensity and it ended with a softer and more understanding tone towards the end of the testimony.

Chairman Bernanke expressed his anger towards AIG, and explained that AIG's investment operations were operating like a hedge fund, and because of such unmanaged risk that were taken by them, where it also went through the regulatory loopholes, thus causing the worries. If AIG is to fail now, the effect may be catastrophic and detrimental to the current financial woes of the economy. The Fed did really think and consider about the consumers of such insurance products who had given premiums to the insurer, and the possible effect if AIG is to fail, there will be another vacuum that could cost adverse effects in the health care system as well.

One of the Senator did bring up to Bernanke's attention to ask if AIG was labeled as a 'zombie institution'. I thought that was a pretty interesting one, but Bernanke replied neutrally to the question, which panned out to be a 'no'.

As for future plans to AIG, they hope to be able to break up the company, and subsequently sell the company at a later stage.

After the testimony today, where I will express in my personal opinion, I feel that the U.S economy is currently going through a very rough patch. The existing problem on hand is indeed extremely challenging for the Obama Administration and Ben Bernanke:

1) They have a huge deficit that may take 2 generations to clear.
2) They have to find ways to acquire national income and maintain a healthy Debt to GDP ratio for the country. In my opinion, now, not only the big financial institutions are technically insolvent, I think the U.S economy is technically in it as well.
3) They have to work hard to maintain the credibility of the U.S government securities.
4) They are still currently using good money (TARP, Stimulus Package, TALF and more to come) to chase after bad money (Citibank, AIG, GM and etc), after 8 months of rescue to the economy.

Simply, such problems could not be resolved over the next 2 years. It will take a longer than expected time to recover from this impact. If you had followed closely, Dow at 7,100 was the 50% mark between the high in Oct 2007 to the low in 1932. Thus by taking less than 2 years, all these gains were simply wiped out.

Continue to look into the stock market for clues for the recovery, as this is where most sovereign wealth funds, governments, great investors and gurus' monies are in now. If you have time to watch a 6 part (10-min) clip, I urge you to watch this interesting video documentary on the Great Depression of 1929.

Here is the video link to the testimony

Video: The 1929 Crash

2009-03-03T14:32:00.001+08:00

I have to post this 6-part video on this. This documentary looks into the 1929 great depression and an outlook on similar it is compared to our current crisis.

Enjoy this video...

Video: The World is Flat by Thomas L. Friedman

2009-03-03T11:11:00.004+08:00

I believe his book 'The World is Flat' could have caught your attention while you were browsing around for a weekend read. I will not introduce him further. Enjoy this 48min video.

Video: Jim Rogers 1st Mar 09

2009-03-03T10:55:00.001+08:00

Very honest views from Jim rogers, in my opinion. What left me with a very strong impression on this video was when he quoted:"Go become a farmer.."
Enjoy the video..