Prechter: Stock Market, Crude Oil, Gold To Fall | MartinKronicle - Michael Martin
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Prechter: Stock Market, Crude Oil, Gold To Fall

Bob Prechter is the President of Elliot Wave International. He predicted the crash in 1987 so naturally, when things are looking bleak, he is often a guest on TV.

Prechter believes that “nowhere is safe” in the impending drop that he predicts (except for the US dollar). I disagree with him, but it’s always healthy to listen to dissenting opinions in order to learn.

Maybe Prechter is right, maybe my neighbors-girlfriend’s-brother’s-second-cousin-once-removed is right. If you are an investor or trader, you can put in protective stop orders on your positions so that if there is a strong downward draft in any of the markets, you’ll preserve your equity – which is always the first order of business.

By putting the orders in and leaving them there, you might feel some relief from much of the negative press.

If you are so inclined, you can learn to sell short. By doing so, any downtrend can be profitable, not just market moves to sidestep.

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  • Jung

    He's been predicting a market crash for 20 years. Who knows.
    Get one call right, people thinks he knows what he's doing.
    *shrug*

  • ben

    if you are always bearish, you are bound to be right some of the time…

  • martinkronicle

    Correct…under the guise of /the broken clock is right twice a day/
    manner…

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  • irondoor

    I got interested in trading a few years ago. Of the several books that I've always kept on my shelf and re-read many times, three of the ones that stand out are the two Market Wizards and Reminiscences of a Stock Operator. I found the first Market Wizards book to be most fascinating because I believe it chronicles some of the greatest independent (not prop desk) traders of the time.

    I was attracted to the interview with Paul Tudor Jones, probably for his style. It was fascinating to read (on page 130) his answer to the Schwager's question, “Are there any market advisors that you pay attention to”? Jones reply was, “Marty Zweig and Ned Davis are great; Bob Prechter is the champion. Prechter is the best because he is the ultimate market opportunist”. Schwager then follows up with, “What do you mean by opportunist”? Jones replies, “The reason he has been so successful is that the Elliott Wave theory allows one to create incredibly favorable risk/reward opportunities. That is the same reason I attribute a lot of my own success to the Elliott Wave approach”. I don't know if Jones still feels this way about Elliott, but there is the quote. It was due to his endorsement of Prechter that I became interested in learing more about the idea.

    I always read derogatory commentary about Prechter. I wonder how many of those have actually read his work and studied the theory of the Elliott Wave Principle. Bob can defend himself, but he has built one of the largest and most successful market forecasting organizations in the world. People follow and respect him for a reason. No one seems to ever call to account the forecasts of the leading economists and market analysts on Wall Street. It's as if they never made any calls. What were their predictions in the summer of 2007? or the summer of 1987? Who among them called the end of the market decline in late February of 2009? Of course, he did not turn long-term bullish though he did forecast a rally back to 10,500 on the Dow. I can't answer why he gave up the potential for a 50% gain.

    No one is infallible and Prechter is not a short-term market timer (though his organization does produce short-term publications). My experience is that Prechter has usaually gotten the big picture moves right, though early. I believe you should trade on price, but have an idea about the dominant trend in your market. The Impulsive and more powerful moves usually occur in that direction.

  • irondoor

    I got interested in trading a few years ago. Of the several books that I've always kept on my shelf and re-read many times, three of the ones that stand out are the two Market Wizards and Reminiscences of a Stock Operator. I found the first Market Wizards book to be most fascinating because I believe it chronicles some of the greatest independent (not prop desk) traders of the time.

    I was attracted to the interview with Paul Tudor Jones, probably for his style. It was fascinating to read (on page 130) his answer to the Schwager's question, “Are there any market advisors that you pay attention to”? Jones reply was, “Marty Zweig and Ned Davis are great; Bob Prechter is the champion. Prechter is the best because he is the ultimate market opportunist”. Schwager then follows up with, “What do you mean by opportunist”? Jones replies, “The reason he has been so successful is that the Elliott Wave theory allows one to create incredibly favorable risk/reward opportunities. That is the same reason I attribute a lot of my own success to the Elliott Wave approach”. I don't know if Jones still feels this way about Elliott, but there is the quote. It was due to his endorsement of Prechter that I became interested in learing more about the idea.

    I always read derogatory commentary about Prechter. I wonder how many of those have actually read his work and studied the theory of the Elliott Wave Principle. Bob can defend himself, but he has built one of the largest and most successful market forecasting organizations in the world. People follow and respect him for a reason. No one seems to ever call to account the forecasts of the leading economists and market analysts on Wall Street. It's as if they never made any calls. What were their predictions in the summer of 2007? or the summer of 1987? Who among them called the end of the market decline in late February of 2009? Of course, he did not turn long-term bullish though he did forecast a rally back to 10,500 on the Dow. I can't answer why he gave up the potential for a 50% gain.

    No one is infallible and Prechter is not a short-term market timer (though his organization does produce short-term publications). My experience is that Prechter has usaually gotten the big picture moves right, though early. I believe you should trade on price, but have an idea about the dominant trend in your market. The Impulsive and more powerful moves usually occur in that direction.