Roger Writes from NC with Thoughts on the Stock Market

1)lOOK AT THE CHART OF usagx----THE USAA GOLD FUND. It is falling and in my opinion, has about 75 cents to a dollar more to fall. Also notice, the early May peak and the early July peak. I personally sold in early May and bought back in late May when the market had a panic sell like yesterday. I also went to 50 percent cash in early July. When a few prices went to newer highs in early August I wondered "IF" I was wrong. Now we know the answer.-----Yesterday was an elliott wave three----ie volatility and volume. While there can be a wave four bounce at any time, the ultimate answer is that a fifth wave down is still to come. DOES THIS FIFTH WAVE HAVE TO BE MUCH LOWER THAN YESTERDAY'S LOW???? NO!!!! An interday lower price would satisfy requirements.-----------but, LOOK FOR GAPS IN LATE MAY--EARLY JUNE IN INDIVIDUAL STOCKS. PUT GTC BUY ORDERS IN THE MIDDLE OF THE GAPS. PS---the chart action of $BPGDM was a warning to watch for a sell off. IMO look for a bottom between 50-60 percent. 2)The major averages now have broadening tops on monthly, weekly, daily, and even hourly charts. Now internal indicators are weakening. Be careful of a few days of sell off. 3)Sept-Oct are the worst months of the year for the averages. WHY??? 1)Folks sell to raise money for school/college expenses.----2)Sept 15 corp tax payments.-----3)Sept 30 fiscal year end for mutual funds---want to show realized profits for year.----4)Farmers harvest and want their yearly income which puts strain on banks.----5)Retailers place orders to stock up for Christmas sales. Inventory expense/cost/loans.--------In other words, there is a lot of cash needs in the fall of the year. BE WATCHFUL FOR A MARKET CORRECTION.