Friday, March 18, 2011

Is QE3 Ahead? asks Lew Rockwell

Is QE3 Ahead?

the sep '10 rally setting up near 'classical' (it's eerie, really!) wave shapes, with 5-wave steady climbs, 3-wave orderly retraces - if the pattern holds, the retrace gives way to a strong wave 5 up, with the 'real' correction to follow after

all assuming of course that a new bull market started in mar '09, making sep '10 wave 3 of the rally - the bears could read it as wave C of a retrace, and I'm not talking of "permabears", even the Aden sisters are still bearish long term - here's why I'm giving... ummm, 'unorthodox', 'unconventional' weightage to volume because I know "primary dealer" activity is quite capable of moving price action as if its' on rocket fuel! so, I'm watching how the larger herd is reacting, are they buying in? one should be seeing green bars dominating the volume story, instead we still have sub-average volume on rallies and big volume on sell-offs

*too* classical wave shapes + unorthodox herd behavior = reflation roulette wheel is still spinning... you want to watch the insiders, are they buying on the dips? you see, managers and analysts think from quarter-to-quarter, their reference point is their peer group, they can post a 'win' in their column based upon that - you cannot, it is your money, your family, you have to think safety and long term security first

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