Special Update From Grizzly
Fri. 09/28/01  9:00 PM EDT
Our short-term outlook for the markets this week proved to be wrong. (No, we don't bat 1.000, either.) We misjudged the extent of the rally and it has carried beyond expectations. The DJIA gained 166 points today and 7.3% for the week to close at 8,847. The Nasdaq gained 38 points and closed the week at 1,498, up 5.2%.

Despite the week's gains, it was a dreadful month and quarter, at least for the Bulls. The Nasdaq lost 17% in September and 31% for the quarter. The DJIA fared better, losing 11% for the month and 17% for the quarter. How bad was it? It was the Nasdaq's second-worst quarter ever, and the DJIA's worst since the 4th quarter of 1987. According to CNBC, only three, count 'em, three of the Nasdaq 100 stocks gained ground in the quarter.

So what lies ahead? October of course is notorious for market crashes. All this week, there's been all too much talk of last Friday being a wash-out low. Most of the anal-ysts parading across CNBC are still spouting the party line, namely that this is (yet another) one of those once in a lifetime buying opportunities.

In Elliott Wave terms, the markets are at critical juncture right here, and the picture should clarify soon. Despite Friday's rally, the Nasdaq has held below Tuesday's high of 1,528. If this level is surpassed early next week, then the door will be open to further advances over the coming weeks as a major counter-trend rally will be underway. Alternatively, if Thursday's low of 1,420 is breached early next week, another solid leg of decline should ensue, carrying the Nasdaq down toward the 1,225 area, and potentially much lower.

Stay tuned and have a great weekend!

Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

grizzly@bearmarketcentral.com

Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

grizzly@bearmarketcentral.com

In Elliott Wave terms, the rebound from Friday morning's low, particularly in the DJIA, is almost certainly a three-wave corrective pattern, which is close to completion if it didn't do so this afternoon. From here, the odds strongly favor a sharp five-wave down leg, likely starting tomorrow or Wednesday at the latest, that will bring the markets back below last Friday's low, and potentially much lower.

Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of September 11th and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

grizzly@bearmarketcentral.com

The DJIA crashed 14.4% on the week, its worst weekly performance since the depths of the Great Depression, the week of July 21, 1933. The S&P 500 plunged 11.6% on the week, its worst since the Crash of '87. The Nasdaq tumbled 16%, its third-worst week ever. These indices now sit (they're too weak to stand) at three-year lows. The Wilshire 5000, the broadest of stock market indexes, fell 12% on the week, causing over $1.4 trillion dollars in total market capitalization to evaporate.

The DJIA has now fallen eight trading days in a row as well as four weeks in a row. The DJIA has lost over 2,000 points since August 27th, 11 trading days ago. Similarly, the Nasdaq has tanked 500 points since then. Since its all-time Bubble peak of 5,132 back on March 10, 2000, the Nasdaq has collapsed just over 3,700 points, or 72%. Indeed, dozens and dozens of Nasdaq stocks are off 85-90-95% from their peaks.

Our roster of bear funds surged this week with the market's collapse. Here's a sampling of fund performances:

So what will next week bring? In Elliott Wave terms, the markets have yet to mount any kind of five-wave impulse pattern, which is required to begin a rally phase. This strongly suggests that the markets will extend at least a few more zigs and zags to the downside before finding more than an interim bottom

But despite all reassurances from President Bush, Sir Alan of Greenspan and the "hang in there, invest for the long term" anal-ysts parading across CNBC, the current situation is potentially calamitous. Potentially we have just concluded Week One of an historic multi-week or multi-month crash event that could bring the markets and the economy to their knees. 

At some point the pain and suffering being endured by those holding stocks will become so great that they will sell at any price, just to end that pain and suffering. We're probably not there yet, but it gets closer with each each day of 3-4-5 % declines. We'll try and ring the legendary bell for you when it comes, but in this unprecedented geopolitical climate, anything goes, and the markets will go with them. Stay tuned for more wild volatility. 

Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of this week and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

grizzly@bearmarketcentral.com

The market as measured by the DJIA, S&P 500 and Nasdaq Comp have lost nearly 13 percent so far this week, about $1.2 trillion in market capitalization (this week alone). Only a huge rally on Friday will prevent this week from being the worst week since the Crash of '87.

So when will this Great Bear be satiated, at least for this meal? He's ignored the extreme and historic oversold technical condition of the markets for two months now. Pessimism on The Street is reaching epidemic proportions. Bulls are literally nowhere to be found.

Despite all reassurances from President Bush, Sir Alan of Greenspan and the "hang in there, invest for the long term" anal-ysts parading across CNBC, the current situation is potentially calamitous. Potentially we are in the early stages of an historic multi-week or multi-month crash event that will bring the markets and the economy to their knees.

Can anyone think of any reason to buy stocks right now, other than that they're "cheap" (cheaper than they were two weeks or two months ago)? We can't. Fear and panic and despair are indeed heavily evident on Wall Street and Main Street. Yet sometimes the cabbage is so rotten that it's not worth buying at 70-80-90% off the full price.

But being the contrarians we are, such one-sided evaluations are often the makings of market bottoms and historic buying opportunities. Are we there now? Maybe, we sure as hell don't know for sure.

At some point the pain and suffering being endured by those holding stocks will become so great that they will sell at any price, just to end that pain and suffering. We're probably not there yet, but it gets closer with each day of 3-4-5% declines. We'll try and ring the legendary bell for you when it comes, but in this unprecedented geopolitical climate, anything goes, and the markets will go with them. Stay tuned for more wild volatility. 

Back in our last Grizzly's Growling Report on August 8th, we asked: "So how far down will the Nasdaq go? At this point, we can’t put a high-confidence number on it, but the 1,000 area seems like a likely suspect." We also stated that "about all the bulls have going for them is hope." The terrorist attacks have now quashed that too.

Folks, the Great Bear is not confined to the US. For example, every world market index tracked by Yahoo (save tiny Slovakia) sank today (Thursday). 

grizzly@bearmarketcentral.com

Special Update From Grizzly
Wed. 09/19/01  9:00 PM EDT
We said yesterday: "After devouring 525 Nasdaq points since August 3rd, we think the Great Bear is close to having his fill for this meal." Well, the Great Bear may have finished his meal today with dessert. After a momentary bounce at the opening, semi-panic selling set in and drove the markets down to levels not seen in three years. 

At 2:45 PM EDT the DJIA was down 423 points and the Nasdaq was down 104 points. Finally, some buyers surfaced along with short-coverers and a solid bounce into the close cut the day's losses substantially. For the day, the DJIA lost 144 points (1.6%) at 8,759 and the Nasdaq surrendered 27 points (1.7%) at 1,527. The S&P 500 saw the underside of 1,000 for the first time since October 1998.

In this unprecedented geopolitical climate, anything goes, and the markets will go with them. Stay tuned for more wild volatility. Our best guess, and it is only a guess, is that today's low of 8,480 on the DJIA and 1,451 on the Nasdaq will mark bottoms that last for days if not weeks. To be clear, we don't think it's the bottom, but a temporary support level from which the markets will work off the extreme oversold conditions before resuming another leg of decline in the Great Bear Market of 2000 - 200[?].

Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of this week and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

grizzly@bearmarketcentral.com

The Nasdaq popped 25 points higher at the open but it was all down hill from there. The Nasdaq closed just a few points above the low of the day at 1,555, down 24 points (1.5%).

The short-term Elliott Wave patterns are suggesting several more days of zigging and zagging with the bias to the downside as small degree 4th and 5th waves work to completion. We don't have a solid target area, but 1,400 should offer at least temporary support. 

From there, a solid and lasting bounce is likely. After devouring 525 Nasdaq points since August 3rd, we think the Great Bear is close to having his fill for this meal. The question is, how soon before he get hungry again? We wish could ask him, but he still has stock in his mouth so he's not talking.

As we said yesterday, there was a lot of chatter about this being another "buying opportunity." CNNfn characterized Monday's sell-off as "orderly." In all, despite the 7% drop in the market, there was little of the true panic selling and financial blood in the streets that typically mark a capitulation bottom. 

In this unprecedented geopolitical climate, anything goes, and the markets will go with them. Stay tuned for more wild volatility.

Special Update From Grizzly
Mon. 09/17/01  9:00 PM EDT
Wow, Monday was indeed one for the record books. 

Sir Alan of Greenspan & Co tried to soften the anticipated blow with a rare pre-opening interest rate cut announcement. The Fed dropped its target for the federal funds rate by 50 basis points to 3.0%. making for an unprecedented eight cuts this year. But the rate cut was nearly universally expected, only the timing was in question. A 100 basis point cut might have had the desired effect.

After a four day hiatus, the markets opened today with a world-class thud. The Nasdaq gapped down 110 points (6.5%). The 30 DJIA stocks had to work very hard to just open. American Express was the last to do so at 10:15 AM, bringing the DJIA's "opening" loss to 625 points.

The Nasdaq mounted a meager mid-day "dead-cat" bounce, cutting its losses to "only" 66 points at noon. But the bounce quickly faded and the selling resumed. The Nasdaq closed at the low of the day at 1,579.55, off 115.82 (6.83%). 

The DJIA also tried to bounce at mid-day, and at noon it was down "only" 450 points. But again, the selling resumed in the afternoon and the DJIA closed near the lows of the day at 8,920.70, down 684.81 points. NYSE volume hit a record 2.3 billion shares.

This was the DJIA's largest one-day point drop ever, though in percentage terms the 7.13% plunge didn't come close to the infamous 22.6% crash on Monday, October 19, 1987.

The Dow Jones Transportation Average got pummeled an unprecedented 405 points for a 15% loss. The entire US airline industry is in deep doo-doo. Gold mining stocks were among the few winners today, along with our roster of bear funds. Here's a sampling:

Ok, so the big question is where do we go from here? Today's sell-off was pretty much contained to the opening hour of trading. Several anal-ysts on CNBC opined during the day that "well, at least there is a market. For every seller, there is a buyer." (Duh!) There was a lot of chatter about this being another "buying opportunity." At mid-day CNNfn characterized the sell-off as "orderly." In all, there was little of the panic selling and financial blood in the streets that typically mark a capitulation bottom. 

At this point our guess is that the selling didn't run out of momentum today, it just ran out of time. In Elliott Wave terms, today sell-off was likely most if not all of a small degree third wave. We can expect the decline to continue for at least several more days, though choppier and more volatile (up and down) than today's action.

Those of you who follow these spaces regularly know that on Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of this week and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

Special Note From Grizzly
Sun. 09/14/01  4:00 PM EDT
It appears the equity markets will re-open for trading on Monday morning. But, it will be anything but "business as usual." Since Tuesday, gold and oil have soared. The foreign equity markets sold off sharply, stabilized, and (save Tokyo) have plunged again today (Friday). 

We have no idea which way Wall Street will go on Monday. A sharp sell-off ala 1987 is of course a distinct possibility. On the other hand, sentiment for a showing of financial solidarity and patriotism is gathering strong momentum. The Fed and its foreign cousins are standing by to flood the markets with liquidity as needed. 

Highly respected trader Linda Bradford-Raschke is looking for a drop of 5% to 8% at Monday's open, followed by a wild game of chicken. Click here to read the interview at CNBC/MSN.

But even if you're a fully-laden bear, let's hope it doesn't come to this on Monday. Here are the current NYSE trading halt triggers 

A 1,000 point drop in the DJIA will halt trading for one hour if the decline occurs before 2 p.m.; for 30 minutes if before 2:30 p.m.; and have no effect between 2:30 p.m. and 4 p.m.

A 2,000 point drop will halt trading for two hours if the decline occurs before 1 p.m.; for one hour if before 2 p.m.; and for the remainder of the day if between 2 p.m. and 4 p.m. 

A 3,000 point drop will halt trading for the remainder of the day regardless of when the decline occurs.

Those of you who follow these spaces regularly know that last Friday (Sept 7) I announced the discontinuation of these daily updates. (Talk about timing!) However, given the unprecedented events of this week and in all likelihood those to come in the weeks to follow, I will do my best to provide brief and periodic commentary, as warranted by future developments. If you would like to receive email notification when new commentary is posted, click here. 

Again, we thank you for your support and interest over the past three years. We hope you'll continue to visit our web site for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

Special Announcement From Grizzly
Fri. 09/07/01  9:00 PM EDT
Friends, foes, bears, bulls, traders and investors alike, first I thank you all for your messages of concern about the lack of market updates over the past week. We appreciate your support and enthusiasm for our work. 

It is with regret and reservations that I must announce the discontinuation of Grizzly's Daily Growl market updates as well as the monthly Grizzly's Growlings Reports. In the midst of arguably the most ferocious Bear Market and Burst Bubble of all time, the demands of updating these free daily and monthly commentaries have become overwhelming. As with most things in life, priorities must be assigned and decisions must be made. Regrettably, the ongoing market commentaries cannot be continued. We plan to keep bearmarketcentral.com on-line and active, though simply without Grizzly's daily and monthly commentaries.

Make no mistake about it, we firmly believe that Nasdaq 5,000 will remain unapproachable for many years to come as the Great Bear Market of 2000-200[?] runs its course. For much more detailed information on Elliott Wave technical analysis, please see Putting Elliott Wave to Work in the Markets.

Again we thank you for your support and interest over the past three years. We hope you'll continue to visit bearmarketcentral.com for information about bear mutual funds, options investing, Elliott Wave analysis, Jim Stack's Chart of the Week, and much more.

So here's to "Life, Liberty and the Pursuit of Happiness," as each of us shall define it. Signing off from Denver, Colorado, grizzly@bearmarketcentral.com