Several things to think about in the JNJ chart

First, I want to back link to the prior JNJ posts so that any newcomers can read the history.  The history is actually more important than what happened recently because recent events can appear chaotic.  But if the future is predicted using some systemic mechanism (such as how the periodic table of the elements predicted other elements existed before we had even discovered them) then it is easier to understand that something like Elliott waves is somehow (don't ask me how) an inescapable, unavoidable predictor of at least the rough shape (or few such rough shapes) out of myriad possibilities that would otherwise exist.

If you follow it back 2 posts to the original I was pretty clear that a serious peak was near and in fact I wrote, "This chart will fall like a $2 pro on payday.".  That was meant to leave little doubt in the mind of the reader as to my opinion.  The reason I chose to pick on JNJ (and even buy puts on them) is because so many people were telling me "but they make real stuff that people need, therefore their stock will always have good value".   These people have been brainwashed by Wall Street marketing into believing that there is real value in these paper assets.  I'm telling you that, as a matter of practice and not theory, you don't actually own anything if you own stocks.  You have no real voting rights (even large institutional investors with 7,10 or 15%  have no real say although the media will print their rants) and the little pittance of a 3% divvy can be cut off in an eye blink.  And that's after the market value of your holdings is already down 20%.  Insult onto injury, aye.

You can't walk into their facilities waving your shares around while telling people you are going to trade them for copiers and lab equipment.  NOT EVEN IF YOU OWN 49% OF THE PLACE and even questionable to do it if you own 51%.  Not even if the place goes BK.  Common shareholders are lower than whale shit on the BK payout hierarchy.

So please tell me again what the real value of company shares are.  I have been telling people for a long long time that they imbue to the holder no more claim on anything tangible than holding a deed claiming land ownership on the moon.  Both are worth zero in real terms yet people pay to own them both.  Like baseball trading cards, there is no value in them except that which you can create in the mind of the next greater fool, the next Mark and Pasty.  But instead of considering this logic and providing an appropriate response, the answer comes back the same time and again:  "they just are".  Such is the foolishness of the herd.

So here is the truth.  Paper assets of any and every kind are nothing but promises.  Think about it.  Paper represents ownership; it is not ownership in and of itself.  You want the truth about ownership?  The cold, hard truth?  Then listen up because here it is in two parts:

1) The real owner is the person who can demand, as an unalienable right, the possession or receipt of good economic value on the asset.  The real owner never has to pay anyone a dime of maintenance in order to own his asset.  The real owner is the one who regains control of the asset should the current person in possession of the asset decide to stop making payments.
     - When people are paid dividends on stocks, they feel like owners.  Unfortunately, they are not.  If the real owners   decide to cut the divvy there isn't a damned thing that the holders of paper claims can do about it.  What makes shareholders Patsies and not owners is the lack of an unalienable right of being able to repossess his portion of the asset (the scenario above where a shareholder tries to trade shares for office and lab equipment) and the lack of unalienable right to receive good economic value for it.  In other words, there is no guarantee that he can sell the shares for any given price (and at some point, at all).  Likewise he cannot force the company to send him a divvy.  This should make it clear that the shareholder is a bag holder.

     - The same logic applies to people who "buy" condos.  If they decide that they no longer desire the services which are supposed to be covered by the monthly ripoff fee, they cannot just stop paying it and continue to live there even though they might own clear title to the place.  The real owner of a condo is the developer who marketed it to people as ownership when in fact they still have to come up with a monthly rent check lest they be tossed on the street at gunpoint if necessary by the police.

     - The final example here is not going to set well with a lot of people but, unfortunately my logic is sound.  Even a so called homeowner who has completely repaid the loan to the bank is not the real owner of the property because, per my definition, they (we) have to continue to send tribute to Caesar in the form of property taxes.  Many places will let you go in arrears for a time but at some point (especially if the value of the place falls relative to amounts owed), they will send the police to remove you at gunpoint if required.  How is this really any different from a condo owner or even a renter?  Unless and until property taxes are abolished there is no such thing as true property ownership.  I believe that property taxes in many places will indeed be abolished when we return to the gold standard.  Not because they want to abolish these taxes but simply because the herd will require it.  I don't have time to share my reasons for this (and it would be a tangent anyhow) so I will do it in a future post but the bottom line is that a free citizenry does not labor under the weight of a dishonest money supply and the lack of property real ownership.  We are not free right now and have not been free since 1913.  We are in their matrix.  Freedom can only come once the fake money supply collapses of its own corrupt weight.

All of this preamble is really to help people why their "kant lose" stock in fact has no choice in the matter.  All of them are going down.  This is why I picked on JNJ as well as MMM.  These companies make real products that we all need.  They probably won't BK.  But that doesn't mean their shares won't lose 80,90% or more of their peak value in the coming collapse.  Go look at the long term chart of Japanese stocks.  Did the companies all disappear as the Nikkei 225 lost 80+%?  No.  Just like the baseball player featured on trading cards doesn't have to give up the sport if people don't feel like paying much or anything for his trading card.  It is zero different.

So how is my JNJ prediction doing?  So far so good as the shares peaked at $108.50 (Compared to my $104-$106 model range) and they subsequently lost 12% of the value from the peak in only about 10 trading days.  People are thinking to themselves, don't worry, they will come back.  But the wave count is pretty clear here and the truth is no it won't.

Below we have the final wave count for JNJ along with the Andrew's Pitchfork channel.  The breakdown is both obvious and dramatic.  The first probing breakdown was likely 5 of 1.  Then a bounce back up into the channel where it was left to the power of a 3rd wave to break down for good.  Have a nice long look at these sky high share prices because anyone 40 or over will likely never see them this high again in their lifetimes.

I will be on the road tomorrow but I will be trying to trade the major turns of the model below by cell phone though Ameritrade's shitty user interface.  I hope to make no more than 1-2 trades all day.  The key will be to be all in when black 4 peaks, likely into the close tomorrow.  I suspect the retracement into black 4 will be strong enough that it will consume the entire day, not end mid day and reverse.  Of course, there is no requirement for that, just conveying my expectations on the nature of the trade given the degree of retracement (black 4) that I currently show as its count.

This model might turn out to be wrong but if you see 5 waves up from red b that rise to the level of blue 4 then do yourself a favor and buy TVIX at that point and then keep loose stops.

Begin to suspect very greatly that the model is wrong if JNJ (or the DJI or $COMPX equivalent) puts in a lower low than red b...  Trust but verify!