Old Project Avalon Forum (ARCHIVE) - View Single Post

eugene_vn · 10-23-2008, 04:51 PM

I don't happen to use biblical prophecy to make stock market forecasts (though I readily admit it might be as accurate as any of a number of other methods), but the timing of Oct. 24 for a major market decline ("crash" if you prefer) seems about right to me.

As Knightbk points out, at this point, words like "crash" are relative. The stock market is already around 40% below its all-time peak. We are headed down to at least 1800 on the Dow and quite possibly, just triple digits. We will get there not in a day, but over a few years, in a process of many days of 3-5% declines, punctuated by occasional (and steep) rallies to the upside.

My next near-term downside target is 6800-7000 on the Dow. I wouldn't be surprised to see it go quite a bit lower. However, following that decline, we should see a sustained rally back up to the 8800-9000 level, possibly even shooting as high as 10,000. Therefore, whatever "crash" may occur on or around Oct. 24 should be seen as one of many sharp drops, rather than as a mammoth one-time event.

While a nimble trader could theoretically make a good profit going long at 7000 and selling at 9000 on the Dow, in reality, it's far too risky that (s)he would get run over by the great bear market. The strategy of buying put options discussed above on this thread can be a good option for savvy traders, but at some point, many of the brokerage houses themselves are going to go broke (no pun intended), and so even if your online trading account shows you as "having" hundreds of thousands of dollars, you could still find yourself getting stiffed by your bankrupt broker when you want to convert those computer entries into real money, i.e. gold.

10-23-2008, 04:51 PM	#57
eugene_vn Avalon Senior Member Join Date: Sep 2008 Posts: 31	Re: Oct. 24: Stock Market Crash I don't happen to use biblical prophecy to make stock market forecasts (though I readily admit it might be as accurate as any of a number of other methods), but the timing of Oct. 24 for a major market decline ("crash" if you prefer) seems about right to me. As Knightbk points out, at this point, words like "crash" are relative. The stock market is already around 40% below its all-time peak. We are headed down to at least 1800 on the Dow and quite possibly, just triple digits. We will get there not in a day, but over a few years, in a process of many days of 3-5% declines, punctuated by occasional (and steep) rallies to the upside. My next near-term downside target is 6800-7000 on the Dow. I wouldn't be surprised to see it go quite a bit lower. However, following that decline, we should see a sustained rally back up to the 8800-9000 level, possibly even shooting as high as 10,000. Therefore, whatever "crash" may occur on or around Oct. 24 should be seen as one of many sharp drops, rather than as a mammoth one-time event. While a nimble trader could theoretically make a good profit going long at 7000 and selling at 9000 on the Dow, in reality, it's far too risky that (s)he would get run over by the great bear market. The strategy of buying put options discussed above on this thread can be a good option for savvy traders, but at some point, many of the brokerage houses themselves are going to go broke (no pun intended), and so even if your online trading account shows you as "having" hundreds of thousands of dollars, you could still find yourself getting stiffed by your bankrupt broker when you want to convert those computer entries into real money, i.e. gold.