Commentary From Tim Wood

Interesting editorial from Tim Woods on FinancialSense.com. Warning! Counter-Trend Moves Spark False Hopes

• But, the technical data I’m looking at tells me that the bottoms seen in these markets were not THE BOTTOM, but were rather temporary bottoms. The advance out of these bottoms are counter-trend moves and should ultimately be followed by still lower prices. Now, that being said, I must also say that my cycles work anticipated and allowed me to identify each of these bottoms as they occurred and this is all documented in my newsletters. At present, I must also say that my intermediate-term Cycle Turn Indicator remains positive, which means that as of this writing these counter-trend moves are still intact. In my work, the key to identifying the top of these counter-trend moves is my statistical data and the intermediate-term Cycle Turn Indicator. Once this indicator turns the counter-trend moves should be done. The danger that I see with these counter-trend moves is that they have fostered false hopes. These rallies have offered people the opportunity to recoup some of their losses. But, the longer a particular market rallies the more the false hopes set in. This in turn allows the wish to begin to father the thought. It is the greed to recover the losses that will ultimately cost the average investor even more in losses. As the advance continues the greed sets in and people wish for more and more of an advance as they hope to further recoup their losses. In the end, the bear market will take the gift that is has given by these counter-trend rallies back. Yes, in the end most investors will find themselves with even larger losses than they had at the previous bottom. The greedy public does not recognize these moves as counter-trend and they will sit on their wishes as the market turns back down and their recovered losses turn into yet bigger losses. One does not have to be blindsided by the coming downturns. It is indeed possible to identify the pending downturn out of these counter-trend moves with the proper technical tools, such as the time proven intermediate-term Cycle Turn Indicator. Sound unbiased technical methods are the only way I know to navigate the ongoing financial disaster that we are dealing with. The politicians, Republican or Democrat, nor the mainstream media warned you of the previous declines because they did not know they were coming and even if they did they would not have told you. Do you really think they would tell you anything any different this time around?