Johnnie Ellington II August 24, 2015 at 7:09am · A False Move is an event that must shake the tree and get everyone out of their longs and many then short

Johnnie Ellington II

August 24, 2015 at 7:09am · 

A False Move is an event that must shake the tree and get everyone out of their longs and many then short. It is typically 2 to 3 months in duration. We can see we did NOT get the Phase Transition for 2015.75. Yes we more than doubled from the 2009 low. But that still did not satisfy a Phase Transition. The minimum would have required 23000 by now with the medium target being 30000 and the extreme 40000. You can see here the doubling effect between the last False Move and the 1929 high. Gold rose from $100 in 1976 to $400 by December 1979 and then it doubled in a Phase Transition to $875 by January 21, 1980 in just 8.6 weeks – very short time span. The crawling along our first target at 18500 illustrated this was not the right time for the Phase Transition and this suggested a postponement until 2017 for 2015.75 first had to complete the bubble in bonds (government). This dove-tails nicely with the rise in third party activity for the 2016 election. Keep in mind this can be a break with a split in the Republicans or a successful internal revolution against the corrupt country-club Republicans like Boehner.

Shaking the tree right now does NOT suggest that the Europeans are gone forever. They are just pulling back now impacting the Euro moving counter-trend to most other currencies. The Dow will rise with interest rates and that will attract foreign capital with a rising dollar. For the flip side when we reverse, they will be back but this time we should start to see domestic retail join in as the new buyers. Initially, the rally should begin with short-covering. We simply need to build the forces for a Phase Transition. That requires the bulk of people to call for a CRASH so they keep trying to SELL the rally after this False Move and that helps to fuel the rally contrary to all logic of market pundits.