Recession-proof Strategic Asset Allocation Swing Trades optimize returns & minimize risk

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1 August 2, 2014 Recession-proof Strategic Asset Allocation Swing Trades optimize returns & minimize risk In this issue we focus on the ETFs in our Recession-proof, Asset Allocation. The interplay of asset-classes represented by ETFs, previews the nascent plunge as it gears-up magnitude, to provide a rare insight into the Bear Market initiated As you see in the monthly increment Dow below, a colossal, Bearish Diag II in process since 2002, is the reciprocal of the previous Bullish Diag II, which preceded the Great Bull Market beginning Page 1 of 31

2 Note the chart above is in log scale so the 10x increments dwarf the structures more as they approach the top. In both cases a subsequent, long trajectory followed. Like the Bullish Diag II, its Bearish counterpart was preceded by a lower degree fractal 1. The same sequence to end in wave A, was repeated in wave C to preview the trough. Diag^s indicated by dashed lines doubled magnitude yet again in wave D. As in the example above you will see the Big Picture Weekly or Monthly historical chart, followed by the 2-hour magnification. The subsequent free-fall to likely confiscate 1/3 of Market Wealth As in waves A & C, wave E must likewise repeat a Diag II fractal, proportional to twice the magnitude to complete its first touchpoint at ~Dow 10,570. As indicated by the blue arrows, Dow 10,570 retraces a three major Market memory points, to confiscate about 1/3 of market wealth. What s more, the remaining long trajectory to the wave (A) trough, is confirmed by this final, larger fractal. In the Exceptional Bear Big Picture wave count since 1900, the identical structure can be identified alternating as Supercycle Wave (II) , and in as a previewing fractal in Cycle Wave IV Page 2 of 31

3 Timer Digest DOW 100% short the Dow at June 26th close 16,753 Long at the close of Wed July Dow 16,853.83, We were a little early reversing the Dow, as you can read in the call-out, what appeared to be corrective, was in fact impulsive to the downside. From now, until the trough near Dow 570, the larger trend will remain outright Bearish. In the Big Picture S&P below, the corresponding trough falls in the range of SPX Both indices confirm a colossal, Bearish Diag II, despite log scale distortion, which would show a pattern of similar magnitude visibly dwarfed by the former, the invers is true. The latter itineration is far more massive, to confirm a far more violent, proportional plunge. Choose windfall profits over catastrophic losses Last week s wave i plunge is nearly spent. The reversal into a wave ii bounce, will retrace the topmost Diag II, at Dow 17,075. At the end you will have one last opportunity to choose home-run profits over catastrophic losses. Bears will profit more & faster than ever before, while Bulls will get slaughtered. Below the Big Picture S&P shows a likely plunge to the area of Notice the 50-day moving average closely parallels the aqua arrows indicating the retracements highlighted in the aqua arrows in the S&P. The relative strength indicated by the lower chart demonstrates how valuation extremes are followed by dramatic reversals to the opposite extreme. Page 3 of 31

4 Below the inverse S&P, SPXU, shows a likely upside to ~51 will complete wave i. The Diag II which kicked-off the rally indicates the beginning of a long, upside trajectory. Page 4 of 31

5 Bonds The Big Picture Weekly Bond chart below shows a wave 2 upside correction to at least 120 ($1200 for $1000 face value bond) to retrace the uppermost Diag II before the plunge continues. Note the aqua column in 2009 was the Bond Market s orthodox top, concurrent with the 2009 trough for stocks. From 2009 to 2012 the previous 30-year Bond Bull Market was transcending to Bearish in an (A) (B). The subsequent A-B denotes the reversal of the reversal to gear-down magnitude as the second irregular top completed in 2012, marks the beginning of the Bond Bear Market. This transition is what Bill Gross & most other bond experts missed. One final flight to safety will result in the bond prices likely matching the previous high. wave 2 has a maximum upside to 125 (a 25% premium over $1000 face value bond, likely coinciding with the yield trough ) Once wave 2 completes, Bonds will no longer offer Safe Havens. In keeping with Supercycle Bear Markets all assets plunge, except for inverse funds, the VIX and the strongest hard currency, by then the Chinese Yuan will likely have replaced the dollar, as the safe haven currency to preserve purchasing power. The Diag > in Bonds precedes the terminal, wave 2 upside to provide several false signals to the linearlyminded trend-following herd. In the next phase bond prices will likely drop back to the Page 5 of 31

6 January low of 102 ($1020 for $1000 face value bond). Note the previous aqua trajectories were preceded by a Diag > to stump investors, just prior to the final Spike. The inverse perspective in bonds is shown in the yield chart below. Just as the Bond price chart above, only inverted, the30-year bond should retrace the 1948 post-war low of 2.4%, concurrent with the peak price in Bonds. A triple top in bond price translates into a triple bottom in yield. Page 6 of 31

7 Timer Digest T-Bonds TMF 20-yr. Long Bond; TMV 20-yr Bear (inverse) bonds FULL pos TMV average cost Jan 21& Jan 23 Sell ½ TMV limit 58 Sell ½ TMV limit 53.4 We sold TLT, the long Bond ETF in May, after an 8% profit since January. When it continued to appreciate, we shorted it via its inverse TMV. Below in the hourly inverse Bond chart, note the orthodox bottom in May was followed by a transition to the upside, nearly identical to Weekly chart above enduring 3 years. Essentially, the same patterns repeat over and over at all degrees of trend, with only slight variations. This time is always very similar to the last, with a curve-ball to throw-off the linear projecting herd, which attempts to replicate the past identically. Page 7 of 31

8 Below the Big Picture Inverse Real Estate shows five waves down ended DRV, on the L y-axis, is overlain with SRS on the R y-axis to gain the longer, historical perspective. As shown, DRV is a relatively new fund initiated in July Despite having the identical pattern, the wave 3 tops occurred some 6 months apart due to irrational expectations from the new, inverse fund. The (a) (b) reversal inclusive of a Diag^ after wave 4, indicates the beginning of a long, wave 5, to exceed the wave 3 high in After magnitude gears-up post the 4 th wave, the 5 th wave is always the longest. This is one of my modifications of Elliot s only 3 Rules: Wave 3 is never the shortest, and usually the longest of 1, 3 & 5. A prime example is found in the topmost Dow Chart, where the 5 th wave transcended to Supercycle degree, entirely replacing Cycle Wave V. From 1982 to 2000, the price territory was longer than the entire price history prior to marked a trough for long stocks, here you have the winning bearish perspective at the wave 3 peak. Page 8 of 31

9 Equity Allocator DRV Inverse Real Estate; DRN Long Real Estate Tax-deferred accounts Full pos DRV average cost June 20 Sell ½ pos limit 38 Sell ½ pos limit Bot 1/3 pos DRV limit 37.5 Fri June 20 Sold 1/3 pos DRV limit 40 June 12 Taxable accounts: Full pos DRV cost Jul 16 Sell ½ pos limit 38 Sell ½ pos limit In the 2-hour interval DRV below, wave iii is in process. The corrective patterns at the tip indicates a reversal to likely retrace the 1 st touchpoint of the Bullish Diag II near 35.5 Page 9 of 31

10 EDC Long Emerging Markets; EDZ Inverse Emerging Markets Tax-deferred accounts: Full pos EDZ average cost March 28 & April 1 Sell ½ EDZ limit 41 Sell ½ EDZ limit 45 Bot ½ pos EDZ cost 38.3 Taxable accounts Full pos EDZ cost July 18 Sell ½ EDZ limit 41 Sell ½ EDZ limit 45 EDC is the long Emerging Market ETF. The big picture Wave 2 is an upside correction within the larger five waves down. As the red dashed arrow shows in the next move, Emerging Markets pull back to the area of To complete wave ii of a 5-wave Wave E upside, two degrees of magnitude lower than the downside labeled in red. This is a critical point required to understand the wave principle, there are opposing trends in opposite directions, operating all the time. Typically an E-wave follows a Diag > to indicate energy being compressed like a spring at every turn, to shoot up like a rocket in the final straightaway of a highly deceptive, Bear Market Rally. The minimum upside, to retrace the Page 10 of 31

11 topmost Diag II is 60 marked by the dashed green line, more likely is 75. Below EDZ, the Inverse Emerging Market ETF is just beginning the trajectory to wave ii which corresponds with wave ii in the long, reciprocal ETF above. They are simply inverted. Page 11 of 31

12 Inverse China: Yang FULL pos YANG cost Jul 2 The situation in China is worse than the West realizes the likelihood of a soft landing is near zero, no country has ever been indebted 250% without a financial crisis shortly after and likely default among others are the US 266% Britain 270%+ & Japan 415% Page 12 of 31

13 The intent with Yang is to back-out China form emerging markets as it goes into the last leg of a Cycle Bear Market begun in 2008 with 5 years left to go. The Shanghai Market above in red, will move inversely to the other Emerging Markets for a stretch. Above you see Shanghai dropping to 1/10 its current value from 2000 to 200. Meanwhile EM are in process of a 5-wave upside to complete wave 2 in the next phase, both will drop in lock-step. Yang Weekly below shows the upside transition initiated in 2013 complete to include a Diag ^ to increment the upside at higher magnitude. Page 13 of 31

14 Below in the 2-hour chart the Volume Spikes highlighted speak volumes about the insider Bearish expectations. Highly oversold on the RSI chart, the upside is in process will be long and nearly as attractive as Shorts in the US. Page 14 of 31

15 GLL Inverse Gold; UGL Long Gold ½ pos UGL cost 46.5 long gold for the swing trade Apr 21 & May 21 Buy ½ pos UGL limit 44 Sell ½ UGL limit 51.8 Bot ½ pos UGL 46.5 May 21 The Big Picture Gold below shows spot gold in red, overlain with the ETF, UGL. In nearly the identical pattern as long Emerging Markets, Gold is in a Wave 2 bounce. Before the upside begins, wave b of the upside reversal has yet to drop a bit lower. With UGL likely dropping to at least 44 & possibly Page 15 of 31

16 Below in the Daily UGL chart you see our buy limit of 44 & sell limit of 52, whichever comes first or in sequence. The buy limit for spot $gold below is Page 16 of 31

17 Below Weekly interval inverse Biotech reversing a second time in a long-term Rally Page 17 of 31

18 BIS inverse Biotechnology; BIB Long Biotechnology Full pos BIS average cost New clients have a 13.5 limit buy for ½ pos Bot ½ pos BIS cost 15.5 Jun 17 Sold ½ pos BIB at the opening off limit of 80 Jun 2 average cost 75.29; March 27 & 28, Apr 4 (sold half Apr 2@ 85.43) Sold ½ pos 79 off 78 limit at the opening May 27 Since January we have reversed positions twice in Biotechnology. The Daily interval BIS represents short or inverse Biotechnology, having just completed wave ii, of a long, 5-wave upside. Among the overstretched valuations, mentioned Janet Yellen recently, we have exposure to both Biotech and smallcap stocks. Page 18 of 31

19 Above long Financials, viewed in Monthly intervals, show the identical Diag II pattern as the Dow & SPX to indicate a long plunge ahead. Below FAZ the inverse Financial ETF Page 19 of 31

20 shows the beginning of a long, Bullish Spike. As always all gaps must be closed before progressing higher in Bullish Diag IIs, which often retrace back to the low. We swing trade these for optimum returns. While we don t always buy at the low, or sell at the high, we often do just that. Regardless, we have a tremendous advantage by capturing the lion s share of the middle ground, to compound over and over, while the buy & hold, fundamentally driven make several round trips back to cost or below. FAZ Inverse Financials; FAS Long Financials Full pos FAZ average cost 18.5 (18.7 June June 6) Sell ½ pos FAZ limit 20.5 Bot ½ pos FAZ cost 18.3 June 6 (low 18.2) Sold bal of FAS limit Jun 2 average cost Sold ½ pos 92 May 27 average cost Page 20 of 31

21 As you can see the long, upside in inverse Financials has begun, with the Bullish Diag II..as always these Diag IIs fill-in all the gaps for a sound foundation to launch a sustainable blastoff. TZA Inverse Small-Cap Stocks; TNA Bullish Small-Cap Stocks ½ pos TNA cost 68.5 Aug 1 Buy ½ pos TNA limit 66 On Jul 30 & 31 we just scaled-out of TZA, the reciprocal, inverse Small-Cap ETF Sold ½ pos TZA limit 15.5 Jul 30 average cost Sold ½ pos TZA limit 16 Jul 31 average cost TNA is the long, Small-Cap ETF, the chart below a Diag > likely in process with a minimum upside of 76 to overlap wave (i) & likely upside of At the opening on Monday, we will likely execute the second scale-in at 66 or below. As long as the opening price is lower than our 66 limit, we will execute at that price openings tend to be extremes for the day, especially after last week s fallout. The lower blue line indicates the low for the move could be at the extreme of 63.. Page 21 of 31

22 TVIX tracks the VIX volatility index, in the chart below you see the $VIX likely top at 28 to correspond with the Dow trough likely in October. The Diag ^s correspond with the Magnitude gearing up in the S&P via the identical Diag^, shown as dashed purple lines in the Big Picture SPX above. Page 22 of 31

23 TVIX Long Volatility & XIV inverse volatility 1/3 of a double position TVIX average cost 6.026; Sell 1/3 pos TVIX limit 4.2 Buy 2/3 pos TVIX limit 2.95 Sold 1/3 pos TVIX limit 3.3 July 31 Sold 1/3 pos TVIX limit 3.8 Aug 1 CXL Sell 1/2 TVIX limit 7.5; CXL Sell 1/2 TVIX limit For taxable accounts only: 1/3 pos TVIX cost 2.69 Jul 16 Sell 1/3 pos TVIX limit 4.2 Buy 2/3 pos TVIX limit 2.95 Sold 1/3 pos TVIX limit 3.3 July 31 Sold 1/3 pos TVIX limit 3.8 Aug 1 CXL Sell 1/2 TVIX limit 7.5; CXL Sell 1/2 TVIX limit Page 23 of 31

24 FXA is the Australian Currency Fund which substitutes for money market in half the cash. We remain in cash waiting a drop to the area of 92, otherwise we remain in cash. Buy ½ pos FXA limit 92 Buy ½ pos FXA limit 91.5 Page 24 of 31

25 Fri Aug 1 closing prices Overstretched Valuations going to undervalued in the next phase Stock Valuations are overstretched, the cyclically-adjusted P/E 10 is 60% above its 130-year average, and the q ratio, which compares stock prices to the assets replacement value, has Page 25 of 31

26 been higher only twice in 1999 & (the 1999 q ratio peak valuation occurred just prior to Supercycle (IV) Bear Market in 2000, and 1929 marked the topmost Wave (B) the Roaring 20 s Bear Market Rally, within Supercycle (II), leading up to the crash immediately following in Wave (C). Volatility: the last cheap asset class in a nascent Supercycle Bull Market Volatility is back in focus as BlackRock, the world s largest asset management firm urged clients to buy volatility in the form of equity options for value. BlackRock asserts that the $VIX is the last cheap asset class in the financial Market. While we heartily concur with Blackrock assessment, long ago we termed Volatility as the sole asset in a nascent Super-sized Bull Market. Rather than options, wasting assets which could lose their entire value if not timed precisely, we prefer the ETN, TVIX, which will retain some of its value no matter what. A New Volatility Bull Market will erupt sooner, rather than later, but in typical Diag II pattern, it continues to drop back to ground zero until all the gaps in the chart are filled. In options, it s the sellers of option contracts that make over 90% of the profit over the longer-term. At 11.5 the Volatility index was only recently trading at a 40% discount to its long-term average of 19. From BlackRock s perspective, rather than signaling the end to the stock market s advance, volatility is simply too low, given geopolitical risk, shifting reaction to the Fed s monetary policy, and a Stock Market that s stretched at historical highs. In the past week, after investors positioned for a Volatility Spike, expecting the September VIX calls to rise from 15 to 21, The VIX closed the month of July up 18%, the highest level in more than four months. Obviously investors are rightfully & increasingly concerned that stock prices cannot continue to rise without a commensurate rise in earnings & income. Obviously a drop in stock prices will result in a rising volatility. The past week also witnessed the S&P s Skew, the difference between implied volatility of puts over calls, increase to a 10-year high, while correlations between all stocks increased to a 1- year high of 75% - signaling its far less of a stock picker s market than before, in a presaging a purge of all stocks in the baby getting thrown out with the bathwater syndrome Volatility is a separate asset class BlackRock s view seconds our own that Volatility is a separate asset class, like stocks and bonds. While this view is controversial, all things new always are. Page 26 of 31

27 While volatility contracts in Asian countries, Hong Kong, Sidney & Tokyo continue to attract little interest, Asian investors are instead choosing to hedge their exposure to future market stress through US-listed VIX contracts. Although designed to capture volatility only in the S&P 500, Wall Street s fear gauge, the VIX will hedge all Global markets collapsing in lock-step. Bursting Bubble Bubbles inflate primarily in two types of assets, those that are hard to short sell, and those with little in the way of earnings to provide a basis for valuation, such as housing, which is also easy to gear up via 10% down or less, just like financial assets prior to the 1929 Crash. Once 10% was gone, investors were faced ruin, while in real estate they can simply continue to carry underwater mortgages, where the value of the property is less than the mortgage. Not too far in the future, many such underwater mortgages will result in bank failures & bail-outs. According to Edward Chancellor thanks to easy money, Bubbles are easy to spot. 1) Price two standard deviations above the norm* 2) Unrealistic expectation of continued appreciation 3) Widespread evidence of fraud 4) Debt financing where the assets produce insufficient cash flow to repay the loans. *As Mandelbrot showed, there were many, many instances of prices 5 or more standard deviations above the norm in the 20 th Century. Euphoria at an all-time high Based on equity volatility, currency volatility and high-yield credit spreads, three metrics utilized by State Street Global Advisors, euphoria is at an all-time high. Retail Investors dump high-yield bonds According to EPFR Global $4.8bn of high yield bonds were dumped this week, subsequent to $2.7bn the previous week.a trend it would seem. Investor willingness to take more risk in search of yield stretches to Emerging Markets, such as Argentina, yields no longer available inform safer assets. Fourteen weeks of volatility at multi-year lows not seen since Institutional Investors exaggerate Boom/Bust Cycles According to a research paper recently published by the Bank of England, Institutional investors are a prone to the same herding behavior as the less sophisticated individuals. Rather than Page 27 of 31

28 investing counter-cyclically, to spread risks in the financial system, & reap optimum profits, Life Insurance Co s & Pension funds evidenced pro-cyclical behavior during the post-2007 financial crisis and the dotcom boom. Instead of buying assets when they are falling, and selling assets as they are rising, as we do to maximize gains, Institutional investors fall prey to the same market herding patterns as the individual. Obviously such herding behavior adds fuel to the fire which augments volatility swings. New-Wave Elliott - a synthesis of Mandelbrot, Smithers & Elliott Exceptional Bear s investment methodology flows logically from New-Wave Elliott, a highly evolved version of the Elliott Wave Principle, advanced & refined over 24 years of empirical evidence. A synthesis of Benoit Mandelbrot s fractal logic 1 & Smithers Century of Market Values 2 reconciled into an Elliott context 3, New-Wave Elliott is the foremost tool for market analysis, trading excellence & exceptional portfolio returns. New-Wave Elliott - differs from previous versions of the Wave Principle in five critical ways. 1) RN Elliott s A-B Base, long discarded by Frost & Prechter, has been reinstated as a key, transcending structure, to precede every reversal, regardless of direction. 2) The identical A-B transcending structure often takes the form of a Diagonal Triangle (Diag >) to upshift magnitude via power laws, after the 4 th wave, and to downshift in magnitude prior to reversal. While RN Elliott discovered & termed degrees of trend, which increment via power laws, Elliott neither identified the location, nor recognized the pattern by which magnitude transcends. 3) Rather than the extremely rare structure, that we been led to believe, the Bullish Diag II, occurs with predictable regularity, to signal the beginning of long, bullish trajectories. 4) Inverted as a corrective structure, the Bearish Diag II, is foundational to the long wave count to signal the onset of an extended Bear Market. 5) A radically new long, Elliott Wave count emerges from these insights. In the next phase, Supercycle Wave (IV) drops to ~Dow 570, the extreme of the previous 4 th wave of one lesser degree, to widen the channel in preparation for Grand Supercycle [III], to sequence Supercycle (IV). Just as Supercycle (III) arose directly after the a-b-(a); a-b- (B) magnitude-incrementing structure after Cycle Wave IV, Grand Supercycle [III] will tag onto the end of Supercycle (IV) in similar fashion. Page 28 of 31

29 Our Roadmap: New-Wave Elliott Wave count (1900-present) Bear Markets in pink Footnotes 1 A fractal is a structure discovered Benoit Mandelbrot, which remains the same no matter how much it is amplified or shrunk down. What s more, it is echoed in its parts & sub-parts. Fractal logic implies that the same structures found in bullish trajectories, must also be echoed in their bearish reciprocals. These insights allowed us reinstate Elliott s previously discarded A-B Base as the transcending structure, which signals every reversal and which takes the shape of a Diagonal Triangle to shift magnitude up or down via power laws after the 4 th wave. While Elliott was the first to conceive of market magnitude, as degrees of trend, he neither identified the location nor the structure of the pattern by which market magnitude transcends. Likewise, a fractal s omni-directional property allowed us to invert the Bullish Diag II, discovered by Hamilton Bolton in the 1950 s, as a uniquely Bullish trajectory. The Bearish Diag II previously unimagined as a corrective structure, is foundational to the long Wave count. These insights enabled us to reconstruct the long Elliott wave count from scratch, to eliminate error & fill-in the missing pieces. Previously mislabeled structures, such as the imaginary running correction spanning 1965 to 1977 became the Cycle Wave IV, Bear Market with a structure: Diag II-A-B-C. 2 Smithers research empirically confirms our long wave count by showing the extreme low values of the entire 20 th century occurred in the (A) wave of Supercycle (II). Measured by Robert Shiller s Cyclically-adjusted P/E 10, and Tobin s q ratio, such low values could not logically occur outside of a Bear Market. A concurrent 70-year plunge in the Consumer Price Index to the level of the Civil War reflects such severe Deflation. Rather than having popped out of nowhere in 1929, Supercycle (II) initiated in 1906, headlined by the Panic of 1907, to span 26 years from 1906 to Page 29 of 31

30 When reconciled with Russell Napier s Anatomy of the Bear, Lessons from the three Bear Bottoms, it becomes obvious that at the minimum (A) wave trough of Supercycle (IV) company shares will sell for less than 10% of replacement value, the q ratio, and 1-2 month s earnings per share, as opposed the current market multiple of year s earnings in aggregate. 3 For those unfamiliar with RN Elliott, he was a CPA by training, who took the opportunity to study the market while recovering from an extended illness. In brief, markets moves up in 5 waves to reflect humanity s technological & cultural progress, and corrects in 3 waves, to retrace approximately 2/3 of the previous advance. Wave 2 corrects wave 1; wave 4 corrects wave 3. Impulse waves 1, 3 & 5 are labeled numerically and color-coded to reflect magnitude; corrections are denoted by letters. 4 ETFs provide exposure to an entire asset class, such as Biotechnology, weighted by Market capitalization (total shares outstanding x price per share). Inverse ETFs are synthetic short sales, which profit as the underlying assets drops. 5 Swing Trading Like a metronome, the Market Pendulum swings from overvalued & overbought to undervalued & oversold and back again. Ideally we want to sell overvalued and buy undervalued, while the emotionally-driven herd takes the losing side of our trades. By selling an overvalued partial positions, we can buy back more the same securities at a discount, to lower the average price and increment profit. When the market drops 37% the only possible way to earn a profit in excess of 240% is by reversing half the positions at least 12 times. As you can see optimal swing trading not only locks-in a profit, but also allow us to buy more shares back with the same amount of capital. Done over and over, small individual profits compound into out-sized annualized returns. The Fibonacci ratios are Nature s Law, virtually all of Nature increments or grows via these ratios, the most important being the golden section 0.618, which determines (relates) the proportions of the base & height of the great pyramid of Giza, & the proportions to the human body, all the way down to the DNA molecule, as well as comparable dimensions in hurricanes, water draining down the sink, and Page 30 of 31

31 even the Milky Way. Likewise, the collective action of millions of profit seeking individuals in the market reflects Nature. That s why RN Elliot referred to the Wave Principle as Nature s Law. Impulse Waves sub-divide in 5 s Corrective waves sub-divide in 3 s This 5:3 relationship is reflected in Nature: higher mammals have 5 fingers & toes, while lower mammals have only three...in the horse the front two toes are fused by natural selection carry extra weight. Similarly primitive flowers like the Bougainvillea have three petals, while wild roses have five petals. Hybridization results in multiples of 3 & 5. Magnitude One of Elliott s most significant discoveries is the progression of magnitude via power laws. In earthquakes, the Richter scale augments in log scale, so a degree 8 earthquake has 10x the destructive potential as a degree 7. Likewise, market magnitude operates on semi-log scale, each sequential degree doubles magnitude and quadruples the destructive potential, akin to the intensity of light proportional to the distance from its source. Halve the distance, and lumens quadruple, double the distance and the light s intensity drops to 25%, just like the market. A Supercycle Bear is 2x the magnitude and has 4x the capital destructive capacity as one of Cycle magnitude, Cycle is 2x the magnitude of Primary degree, and Primary has twice the dimension of intermediate degree. If you subscribe to Stockcharts, please vote daily your vote is critical, this link will take you directly to our page you have 3 votes daily. Eduardo Mirahyes Page 31 of 31