| The various stock markets in the United States | | | | The Candlesticks are hardly new. They were |
| peaked in October 2007. In all probability, this was | | | | invented for use in the rice trade in Japan |
| a major top, the endpoint of a "B" wave in Elliott | | | | centuries ago. One trader at that time enjoyed |
| Wave parlance, following which we can expect a | | | | remarkable success by using them, believing as he |
| long-drawn-out "C" wave down which will retrace | | | | did that they gave him an understanding of the |
| all of the gains which have been made since 1995. | | | | psychology of the traders with whom he |
| This is an unhappy prospect, but we need to plan | | | | competed. Their use in our country has only |
| for it. In other words, we will be in a declining | | | | begun to be widespread within the last 25 years |
| major trend for some years to come. | | | | or so. Even now, many of the major writers |
| The Chinese stock market likewise peaked in | | | | have yet to come to an understanding of their |
| October 2007. The major difference is that the | | | | significance; but the trend is surely running in the |
| Chinese market has lost about half of its value | | | | direction which tells us that one day the Candles |
| since that time. Millions of people who invested | | | | will be universally utilized. |
| their life savings in the stock market as first-time | | | | Just as in American, observation of the Candles |
| investors had been caught up in the mania which | | | | at work in October 2007 did not stop there. It is |
| led to the peak, and now found that the nirvana | | | | an ongoing study; and we see now that the first |
| which they hoped to find has disappeared in a | | | | major downstroke in the Chinese markets may |
| matter of months. There is much criticism of the | | | | have ended and that there may now be a period |
| market system; cisillusionment abounds; and the | | | | of price recovery. However, it is too late for |
| political leadership recognizes the situation as a | | | | those who leaped blindly into stocks, often as a |
| societal threat as well as a threat to its own | | | | matter of first impression. The markets |
| survival as a monopolistic authority. | | | | everywhere are not forgiving. |
| Looking back, we see that the market peak in | | | | It will be interesting to see whether there is to be |
| the United States, and the ensuing price decline, | | | | a cultural interplay between the ordinary man's |
| was predictable by studying the stock and Index | | | | losses in the Chinese stock market and the |
| price patterns at that time. Indeed, the | | | | reaction on the street in China to protests in the |
| formations in the Japanese Candlesticks price | | | | West about what is seen in the free countries as |
| displays predicted that the American markets | | | | Chinese oppression of the Tibetan people. Money |
| would suffer a substantial decline. Now we see, in | | | | losses often focus peoples' attention on other |
| retrospect, that much the same patterns | | | | matters - some object of blame is likely to be |
| appeared in the Chinese stock Indexes. Those | | | | sought out. We understand that, within China, a |
| who were aware were able to get out in time | | | | degree of nationalistic sentiment has been |
| and save their financial skins. | | | | whipped up by Beijing, whereby the Dalai Lama is |
| What is it about the Candlesticks that make them | | | | reviled as the instigator of the "revolt of the |
| such accurate foretellers of the future? Well, | | | | monks" in Tibet. Part of that may be an attempt |
| there is nothing mysterious about it. The Candle | | | | to divert the Chinese people's attention to the |
| patterns simply, but accurately, reveal the | | | | facts of the monks' revolt while at the same time |
| psychology of the market players at any tiven | | | | attempting to focus the attention of the entire |
| time. They are not voodoo. It is interesting that | | | | world on the major show-and-tell performance |
| many of the same patterns appeared in the | | | | which will shortly be unveiled in the form of the |
| American and in the Chinese markets at about | | | | Olympic Games. But repression of the Tibetan |
| the same time. They are not difficult to learn, and | | | | people will onlu bring more determination on their |
| the time devoted to learning the dozen or so | | | | part to obtain a greater degree of freedom. |
| major patterns is time well spent. | | | | |