Delusion is a dangerous place

As these experts showed 12/31/1999, "herding" at market extremes masks all market risk.  These were just the ones chosen for this interview, but believe me, ONLY we and a few other Elliott guys were bearish.  As Louis said, their '99 performance was awe-inspiring, but their '00-'02 performance lost all of their '99 "awe".

Crude is giving it up here, taking out the lower extremes of the sideways pattern of the past month.  90 +/-2 is still the ideal target for this small 5th wave down, but 86.50 is still possible (lower 2 sdb).  A multi week rise toward 99 +/-1 is the next big move, before 70 is target in the next couple years.  ONLY a move above 112 will negate this forecast for lower crude.

Nat Gas bounced off the DSE's warning "not to be short" in August to the current warning of "not to be long" here.  The upside toward 4.20 cannot be ruled out, but the overbought conditions of daily and weekly trend degrees should make 4.00 difficult to break, before at least a test of 3.40, if not 3.20.

Metals are generally higher, with gold leading silver.  Tbonds are giving up yesterday's gains, but likely only in a correction, before 138 +/-1 is seen this year.

Dollar is shaping up as the best play for the coming 12 months, as the longs are accumulating positions for a move toward at least 83.  With breakouts above 85 possible, the 90 level would be next resistance thereafter, giving the long dollar play "home run" potential.  Conversely, the Euro has disaster written all over it.

The Investor's Intelligence Survey came out with the lowest level of bears since March '87.

With Thanksgiving tomorrow, and holiday conditions set for Friday, NOT taking longs off the table here is akin to joining the panel in the Wall Street Week video above.  Note, tomorrow is the first Thanksgiving/Hannukah overlap in 95 years, and the last time it will happen for 70,000 more years.  Enjoy it!

Stock indices are struggling, again, to remain in the green, even though the seasonal trend of the day before and after Thanksgiving is positive.  However, these are only tendencies, and at extremes like this, they often serve as 'traps' to late-joiners.

Delusion is a dangerous place by

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Ken Goldberg is a Registered Investment Adviser, and is the president and chief market strategist at Trading With Waves. Connect with me on Google+
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