it is especially important to protect capital in the coming months instead of aiming at hefty gains.
i suggest you all stay away from stocks in general and financial stocks in particular for the next 3-4 years, look at djia weekly which forecasts a rather bleak outlook and usually fin stocks will lead the way south and they will fall the most.
the recent pullback provides the best opportunity to exit the stock market.
the fallout will take many twists and turns, the first target is 7400 which lead to a multi year head n shoulder, it may pierce through by a matter of 3-5% and just about everyone confirms the downtrend, a big pull back will happen, then the decline resumes.
past history indicates that once such a long period pattern is formed, the outcome is certain and it will complete in about 1/3-1/2 of the time it takes to form the pattern [13 years] which is about 4-6 years.
read my blog
on jpy [24jul09] which said it will reach 65, this coincides with the forecast that djia will indeed fall a lot.
stock 2823, a reflection of A50 will also drop to about 9.3 because of the 10 months or so head and shoulder. the all time high of A50 is 28.8, the rule of thumb if china is to enter a depression, it will reach 10% or less, otherwise a discount to 30% is more appropriate i.e. 8.6. the forecast of 9.3 seems to provide a clue that 2823 may indeed bottom out at about 8.6.
so guys, take good care of your money.
check yahoo finance for dji weekly and 2823 charts:
http://finance.yahoo.com/q/ta?s=^DJI&t=my&l=off&z=l&q=b&p=&a=&c=
http://finance.yahoo.com/q/ta?s=2823.HK&t=2y&l=off&z=l&q=b&p=&a=&c=
24 July 2010
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