Gann - From the AFR Tuesday Sept 11th, 2001

...Start quote:
"Don’t get caught in bear market warns McLaren Professional trader and stockmarket commentator Mr Bill McClaren believes the All Ordinaries Index will suffer a hefty fall this week, but has warned investors against diving in for bargains. “This is a cyclical bear trend so there is no point buying on the rebound, he said.

Mr McClaren, who gained a weekly presence on US cable network CNBC after predicting last years tech crash, said the ASX All Ordinaries Index was precariously balanced and could fall as low as 2700 this week, a fall of about 15%. “If this was just a normal bear run with normal circumstances, a sharp fall would be a time to buy,” he said. “But one of the real problems that you have when you get into these capitulation moves is that if you buy when it falls, then you can’t get out. My conern is that amateur investors will be tempted to jump in and buy, thinking they are getting bargains. They won’t be getting bargains, they will be getting caught.

Mr McClaren who trades the US equity markets each night from his home in Byron Bay, said Wall Street was in the grip of a severe bear market. He said the S&P 500 was poised to fall another 150 points from its current level and the New York Dow Jones Index was headed for another 500 point fall.

Right now I hate to say it and I don’t want to triger a panic out there, but the markets have all the signs of a crash scenario”, Mr McClaren said.

Mr McClaren has been recommending his clients liquidate their share portfolios during July and August. “There’s no reason in the world why we are not going to see the All Ords go back to the lows hit in March”, he said. The All Ords hit a low of 3094 in March. Mr McClaren uses the the charting techniques pioneered by US technical investor Mr W.D.Gann. He claims that all stock market movements have been seen before and that it is possible to prepare for the worst by examining the historic data.
.."...End quote.

At the back of Gann’s book ‘Truth of the Stock tape and Wall Street Stock Selector’, Gann gives us – available to all who would but read it – the dates when the major stocks, and hence indices, would change trend. Of course the forecast of these dates, written in 1928, was for the 1929 year, included by Jones publishing in the book posthumously. Gann does state though, the dates are based on a permanent cycle, which does not change. For Sept, these dates were 2nd/3rd, 16th/17th, 21/24th, 27/28th.

This year, as in previous years, I have found them to work well enough to trade profitably. The October dates are there, so to Novemeber, December and on. Future events do time themselves to the past.

The market low on the 24th looks very interesting: 180 degrees from the previous low Mar 23rd, Equinox, grossly oversold market, 540 deg from the 2000 low, 90 deg from the June eclipse, 270deg from the Dec 2000 eclipse, the SPI lowed at 2882 (144 x 20), anniversary of a major low in the market in 2000 at 3170 (3170 - 2882 = 288 = 2 x 144).

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