Note “A low” and “B low”. If this yearlong formation is a massive top (perhaps a double headed head and shoulders) and A low is its lower boundary then a low of 9680 is predicted. If B low is the defining point the predicted low is 10836. Remember Nils Bohr and the difficulty of forecasting. Again, it is not necessary to believe this scenario to know how to bet. The Dow is in a six month downtrend, the last 2 1/2 months of which are sideways, with lower highs in the sidetrend. The low of 9680 is a probable minimum.

Best illustrated here in the DIA. The utter yapping chorus of opinions as to bull or bear market is an indicator of the confused state of the markets. Frankly we are amazed that anyone would open his mouth with the van Allen belt of flying eggs waiting to land on the face of anyone making confident forecasts at this point. The most you can say is what we said above, and we say it again. That’s our story, and we’re sticking to it.

Mark Hulbert says Richard Band is predicting a 16000 Dow. Watch out for low flying eggs.

Is the pullback in gold over? We will know when the March low is tested. If it does not hold the stop should be about 5% under that low. Same remarks hold for silver.

And for the CRB, which we think might be preceding the metals.

Dollar throws a knuckle ball. Vicious moves for the short term speculator. The long term trend remains down.The action to establish a true bottom here is months long. Probably. Don’t trust anyone who makes forecasts. Just read the charts.

And remember, the surge is working, the Fed will bail you out if you do anything really stupid, and Southwest Airlines is switching part of its fleet to flying pigs.