Saturday, November 15, 2008

DOW DIA is at a very important H&S Reversal point, time for Action. CS, FXI, EWZ, GDX.

We can see from the chart that we are half way there: saving the world from Deflation spiral Japan style for the next 10 years. Bold action is needed now over this weekend to kill the Fear, confirm H&S Reversal squared by Intraday Double Bottom. Dow must overtake 9653.95 on weekly close to diminish Bearish Flag. If not, we will have a waterfall, further assets fire sell and self reinforcing deflation spiral. Dow for us here is only a reference point, but very important now: it is showing whether FED efforts reinflating economy are working or not. Deflation will be forgotten in two weeks after move above 10000. But action needed now. All reinflation efforts are leading to "liquidity trap" if velocity of money is falling of the cliff: banks are not taking any risk and just keeping money at the FED. The key to all is US Dollar: it must be weaken immediately and everything is ready for it: just one push and world will be saved from Deflation Monster. We will refer to further charts on what must be done.

No comments: