Cry havoc and let slip the dogs of the Dow...

In this post I provided this chart of the Dow.  The model that it contains says that the Dow is now in the throw over stages of an ending expanding triangle.  At the time that picture was taken, the 1st wave down had already played out in 5 clear waves (see inset chart to the left which talks about the 5 waves down having a triangle as its penultimate wave) and so the expectation was for a small rally into wave 2 up.  That chart says "Will probably bounce up into a full 2nd wave and then break down mid next week").  By "break down" I of course meant "break back down through the top green line of the expanding triangle".

It would certainly take the power of a 3rd wave to break down in this fashion and so I think that today's rally on the Dow is just what I suspected would happen: a 2nd wave up that sets us up for a big sell off tomorrow or Wed, probably amid some news that is finally being viewed as bad or scary or even just "uncertain" by the herd.

As the saying goes, stock markets hate uncertainty.  By the way, the Illuminati are spewing signals about this left and right to anyone with the eyes to see it happening (i.e. those of us who have suspended disbelief to the point that we have been able to accept the overwhelming evidence that the government is an organized criminal cartel that is corrupt to the core). You need look no further than the father of the coming disaster, Alan Greenspan. 

In any case, nothing is certain.  It is all about odds and about looking for confirmation or negation of modeled outcomes.  Following a model only helps you predict the future with better odds as well as knowing when your model at any level (short, medium or long term) is wrong.  So while I can't say with 100% certainty that the above very short term model is correct, I can say that I have been on topping watch for the major indices for at least 6-7 weeks now and have pointed out several possible topping locations during that time.  Each of those times, the market negated my model.  Maybe it will do that again. 

These short term calls are always the riskiest.  Medium term, I'm sure the indices will collapse in a major way.  Zero doubt.  That is a given due to math, logic and history. I am unshakable in that belief.  There are several reasons for it:

• Stocks are little more than a mechanism to separate a working man from his wealth.  The insiders trade against the individuals.  Insiders win until the the herd gets wise. Then the insiders get the horns.
• Political trouble all over the world is on the rise.  The people of Thailand just overthrew their overlords and new elections will be held.  China is drawing battle lines with US puppets Japan and Korea.
• Greenspan flashing warnings about uncertainty.  That is Illuminati speak for "get out before the herd turns south and you get left holding an empty paper bag" and "I don't think we can fool all the people all the time much longer, soon we won't be able to fool anyone ever".
• Major corporations are banding together to fight NSA oversteps.  I can tell you who will win this and it won't be the NSA.  Why?  Because when it was NSA vs private individuals, only 1 in 330 million had the cohones and the brains and the proper opportunity to flip them the finger in a big way and get away with it (Thank you, Edward Snowden: major whistleblower on government corruption, self-sacrificing patriot and true American hero).  The herd was pissed but intimidated.  But then nothing happened to Snowden.  He wasn't accidented.  Busses are running around with thank you posters on them.  People are self-organizing en masse to carry banners with his picture on them.  But now the herd is seeing the big boys (major multinational corporations) stand up and join arms against the tyranny.  That is what really gets the herd moving folks.  Again, if you have never seen the lions vs. waterbuffalo video that I am so fond of as a model for what it about to happen (and in fact happening), you can check it out here.
•  The rank and file are sensing the turn and it is affecting their actions.  The watero buffalo are becoming more bold.  Check out this video of a Florida police officer who got arrested for failing to remove a Guy Fawkes mask when ordered to do so by the corrupt police.  He was wearing the mask to stage a 1 man protest .  As a result of his arrest, his job is possibly on the line.  This is a young family man who has simply decided that the risk of letting things go on uncontested is greater than standing up and pushing back.  The family unit of the herd is the most risk averse.  For crossing the thin blue line this cop could get blackballed from all police forces and he knows it.  Regardless of the risk, he did it.  Again, this does not happen in the early stages. This is end stage behavior.
• Bottom line: the con men are rapidly losing the confidence (and the respect and the fear) of the patsies.  When that confidence finally collapses it will do so in a cascade of epic proportion.

Back to the model at hand: to repeat, all of these short term calls are merely done in the name of financial entertainment. With the caveat said, I think the chances of a break down here are 85-90%.  This is higher than I normally give my models because there are just too many stars in alignment these day not to expect a real change in herd direction.