Technical evidence once supporting a view toward the market's advance off late-June 2010 bottom supposing a special Elliott wave called a "diagonal triangle," or "rising wedge" had formed into 2/18/2011 top — this to complete the market's counter-trend rally off March 2009 bottom — might still support possibility that, this special wave form unfolded in the Dow Jones Industrials Average into May 2nd top...
Consider this possibility in the context of broader-based indexes presently thought in the process of completing wave 4 of (c) over coming days, then wave and 5 of (c) subsequently (possibly registering a "fifth wave failure" of sorts, as well, in the process). In other words, the BRIC darlings of the Dow might have seen their best, despite still appearing among the market's leadership.
This quick stab at refining present possibilities — one among several, all leading to the market's ultimate collapse — also offers a useful point of reference in assessing the evolving reaction to what rapidly is appearing a growing risk of debt deflation throughout the trans-Atlantic financial system. Global capital flows into dollar-denominated investments — shunning risk far more aggressively than has been the trend these past couple years while insane monetarists were digging out every last trick available for postponing systemic bankruptcy reorganization — should reach higher up in the capital structure than the Dow 30...
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© The Risk Averse Alert — Advocating a patient, disciplined approach to stock market investing. Overriding objective is limiting financial risk. Minimizing investment capital loss is a priority.
Analysis centers on the stock market's path of least resistance. Long-term, this drives a simple strategy for safely investing a 401(k) for maximum profit. Intermediate-term, investing with stock index tracking-ETFs (both their long and short varieties) is advanced. Short-term, stock index options occasionally offer extraordinary profit opportunities when the stock market is moving along its projected path.
Nothing is set in stone. Nor is the stock market's path of least resistance always known. More often than not, there are no stock index option positions recommended.
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