Is the Dow going to dip under 10,000 and are we looking at a dip in the stock market? A simultaneous housing market bubble burst? There are good things today on Wall Street as Oil is retreating, but doesnt it always after a three-day weekend? Dont they always have some great excuse for high prices on three-day weekend holidays? Yes always and some are as good as the Hurricane Katrina reason, I mean that is certainly justifiable isnt it? Meanwhile the airline industry already in bad shape and four airlines near bankruptcy and oil supply and capacity causing high side prices is causing ripples throughout our civilization. God help the independent truck drivers? Retail also taking a hit. Mervyns is calling for the closing of 64 stores and laying off some 4800 folks, which is not too concerning as unemployment is at a record low. Will we see a 2006 downward business cycle year? Will we continue to see high oil using industry sectors continue a downward sector rotation? Some are calling for a price limit on gasoline prices claiming that a group of folks controlling the market thru their strangle hold on the energy markets or simply a global issue with emerging market needs and natural disasters? Yet, even if that were true the price of something, anything should reach an equilibrium in the market intrinsically based on the desire of the buyer. Price controls do not help consumers, they hurt consumers, as anyone who studies such will conclude. George Linsay, a technical analyst of the stock market has come up with a Three Peaks and the Domed House theory, which has been fascinatingly accurate in times past. If this occurs now we will see the Dow Dip below 10,000. If you look at the Dow Index Chart you will see some assimblance of George Linsays three peaks and a build up of what could be a domed house, which could mean a doomed market in 2006 and the start of the end and the beginning of the next business cycle? I think those who are chart watchers need to take a look at the market fundamentals of all industries and those industry analysts who do not believe in chart patterns may want to take a look at these three peaks and go pray in their domed house? Think on this as history repeats so maybe you will not be doomed in denial. |
