Grizzly's Growlings Current Report

Market Update Wednesday 04/12/2000 5:00 pm

Is it Time for the Big One?

In last Monday's Monthly Report, we stated:

"The Elliott Wave patterns suggest further selling ahead in the NASDAQ Comp over at least the next few days." 

In last Tuesday's Update, we added:

"More margin calls and panic selling are likely to rattle the markets the rest of this week, keeping the pressure on and putting a damper on any short-term rallies."

"The rally may carry another few hours, a few days, or possibly a few weeks further, but when it's done, look out beloooooooow. The stage is being set for THE BIG ONE, the Wave 3 crash that should take the major indices down 25-40% further from here."

Well, are we there yet? Is a crash underway? Quite possibly.

The NASDAQ Composite fell another 7.4% today, on top of Monday's 5.8% and Tuesday's 3.1% selling sprees. That's a total of down net 15% in just the last three days. POP! goes the bubble!

The NASDAQ is now down a stunning 26% since its intraday peak of 5132 just over one month ago. With today's drop, the NASDAQ is now squarely in official bear market territory (down 20%).

The Elliott Wave pattern on the NASDAQ suggests further selling ahead over the next two to three weeks, down to roughly the 3300-3400 area. This move would complete a small wave 1 down from the recent larger wave 2 high at 4308. This wave 1 low will be followed by a small counter-trend wave 2 rally, possibly lasting ten days to 2 weeks or so. From there, the REAL crash, the crushing wave 3 of the larger wave 3, would hit the markets like an avalanche.

Amazingly there is little "blood in the streets" or other evidence of a panic sell-off or capitulation. Another 300-400 point plunge on a five billion share day probably would do it.

US STOCKS REMAIN ON FULL CRASH ALERT!

The freefall in the NASDAQ really isn't new news. Many formerly high-flyers have tanked over the past months. Here's a sampling: 

(Additional tankers are shown in last Monday's monthly report.)

As we post this report early Wednesday evening, the major Asian markets are off 1.75% - 2.00%, suggesting some additional downside pressure to Wall Street's opening on Thursday. (See http://quote.yahoo.com/m2?u for up to the minute quotes on all the international markets.)

Which month of the year is second behind infamous October for crashes and mini-crashes? It's May. The only question is whether the markets can hold up until then. Stay tuned for ride of your life!

See last Monday's Market Musings 04/03/2000
  

grizzly@bearmarketcentral.com
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