How to Thrive in Asian-Pacific Markets Using the Wave ... · How to Thrive in Asian-Pacific Markets Using the Wave Principle & Socionomics By Mark Galasiewski (gala-SHEV-ski) Editor,

How to Thrive in Asian-Pacific Markets Using the Wave Principle

& Socionomics

By Mark Galasiewski (gala-SHEV-ski) Editor, Asian-Pacific Financial Forecast

Elliott Wave International (EWI)

2013 Irrational Economics Summit Hilton la Jolla Torrey Pines

La Jolla, California, USA November 6-8, 2013

September 2008:

Pakistan

Sep 11, 2001

1993 WTC (6)

Bin Laden killed

underwear bomber

“News has a way of working into the market’s psychological patterns….If the anti-terrorist forces were to find bin Laden with the market still rising, it would be the kind of ‘news hook’ that caps advances. People often comment that the market needs a ‘catalyst’ of bad news to start a decline or good news to spark a rally, but such is not the case. The market’s relationship to the news is the opposite of this contention.”

bin Laden killed May 2, 2011

S&P 500 Oct 2010 - Oct 2011, daily bars

— Robert Prechter, Elliott Wave Theorist, December 1, 2001

October 31, 2008:

India

1994

2008

2003

October 2008

2003

2008

2003 low

2003 low

2003 low

2003 low

2003 low

PRICE FORECAST:

“Indian stocks are about to begin Primary wave 3 of the bull market that began in 2003. Primary waves 1 and 2 lasted more than four times the duration of Intermediate waves (1) and (2). If that same proportion holds going forward, the SENSEX may continue advancing for 15 years before reaching the end of Primary wave 5.” – Asian-Pacific Financial Forecast, October 31, 2008

SOCIAL FORECAST:

“The most spectacular violence of 2001 in the Asian-Pacific region—the U.S. invasion of Afghanistan and the terrorist attacks on India’s Parliament—took place weeks and months, respectively, after the September lows in the region’s stock markets. The recent escalation of grassroots violence in Afghanistan, Pakistan and India shows the potential for a sequel to those violent events.” – Asian-Pacific Financial Forecast, October 31, 2008

1

2

IV

III (1)

(2)

Figure 1-42, Elliott Wave Principle (1978)

Contracting Triangle

1990

2000 2007

October2008

PRICE FORECAST:

“The Taiwan Index is nearing the end of its Cycle wave IV contracting triangle and, therefore, the beginning of a Cycle wave V to new all-time highs. And that bodes well for the region as a whole—since Taiwan is unlikely to embark on a multi-year bull market on its own. When a new bull market begins, other phoenixes will also rise from the ashes of the current bear market and go on to achieve new all-time highs. Although Taiwan is a laggard in the region, its contracting triangle since 1990 actually makes it one of the most qualified for future success.”

- Asian-Pacific Financial Forecast, October 31, 2008

March 2009:

Global stock market lows

PRICE FORECAST:

“In the March 2009 issue, we showed how pattern, price, time and sentiment considerations were pointing to the end of multi-month….declines in most major Asian-Pacific indexes by late March. In most cases, those lows have likely been achieved.” - Asian-Pacific Financial Forecast,

March 23, 2009 Interim Report

March 2009:

Swine Flu

PRICE FORECAST:

“Researchers have concluded that the swine flu virus evolved in Mexico around September 2008, during the global financial collapse, after which it circulated in the human population for several months. Its outbreak in March 2009 and its spread worldwide soon thereafter appear to have marked yet another significant…low.” – Asian-Pacific Financial Forecast, May 29, 2009

March 2009:

Radical Islam

HOW TO READ THE NEWS

“Radical Islam Is a

Fact of Life. How to Live With It.”

Extreme

Pessimism & Fear

PRICE & SOCIAL FORECAST:

“Newsweek's cover proclaimed, “Radical Islam Is a Fact of Life. How to Live With It,” a headline that probably marks not only a major low in…key Islamic stock markets but also an exhaustion of the trend toward Islamic extremism of the past year.” - Asian-Pacific Financial Forecast, April 3, 2009

February, 2010

(one year later)

PRICE & SOCIAL FORECAST:

“The magazine’s new strong opinion is probably again best interpreted as a contrarian indicator. The editors’ optimism should mark an intermediate-term peak both in Islamic stock markets and in the trend toward Muslim moderation…The coming declines in Islamic markets should coincide with a temporary resurgence in Islamic radicalism. The Arab world in particular remains most vulnerable to the jihadists’ siren call, since many stock markets in that region have not yet reached their final lows.” - Asian-Pacific Financial Forecast, Feb 26, 2010

June, 2009:

Iran

PRICE & SOCIAL FORECAST: “At such a juncture, Iran holds the potential for even greater violence. But with a fifth wave up likely already under way, a wave of acceptance should eventually replace the current anger.” - Asian-Pacific Financial Forecast, June 26, 2009

2013 election passes peacefully

December 2010-present:

Arabian Uprisings

Arab Spring begins

June 2012:

Egypt

Sep 11, 2001

“Wave C of (D) up should foster more unity before conflict re-emerges in wave (E) down.” - APFF, June 29, 2012 Arab Spring

WAVE 5 UP BEGINS

Army ousts Morsi

Islamist Morsi elected

December 2012:

Japan

Dec 7, 2012

PRICE & POLITICAL FORECAST:

“The Nikkei 225 is approaching the upper line of the declining trend channel that has contained its price action for the past three years. If the index can rise out of the channel to the 10,000 level, as we expect it will, the rally could have significant upside. Long a sleeping giant, Japan will probably surprise the world in 2013. The political parties that form a government after December’s general election will likely enjoy a nice honeymoon, thanks to the upcoming market rally.” - Asian-Pacific Financial Forecast, December 7, 2012

Dec 7, 2012

Summer 2013-present:

China & Emerging Markets

“From a contrarian perspective, all those crises appear to have marked the end of the correction.” - APFF, Aug. 2, 2013

PRICE FORECAST:

“The Baltic Dry Index is near the end of a deep three-wave correction, which implies a rebound in shipping demand ahead.” - Asian-Pacific Financial Forecast, Feb 8, 2013 ($748)

February 2013

For a free sample of

Asian-Pacific Financial Forecast, visit:

www.elliottwave.com/wave/IES

THE END

February- April, 2009:

Global stock market lows

PRICE FORECAST:

“Singapore’s Straits Times Index…shows that prices are closer to completing a fifth wave down in the bear market. In a normal impulse, equality between waves five and one is a common relationship…. We expect a couple more up-down sequences to complete wave (5), perhaps by late March. The 21-day moving average of our regional sentiment measure, the Nikkei 225 Daily Sentiment Index, has been in pessimistic territory (under 20% bulls) for more than five months now, a record by far. Such an extended period of deep pessimism reflects the degree of the declining pattern, but also its terminal stage.” - Asian-Pacific Financial Forecast, February 27, 2009

PRICE FORECAST:

“In the March 2009 issue, we showed how pattern, price, time and sentiment considerations were pointing to the end of multi-month….declines in most major Asian-Pacific indexes by late March. In most cases, those lows have likely been achieved.” - Asian-Pacific Financial Forecast,

March 23, 2009 Interim Report

PRICE FORECAST:

“In short, all the pieces are in place to support a multi-month rally.” - Asian-Pacific Financial Forecast, April 3, 2009

January 2011:

Bangladesh

PRICE FORECAST: “The Dhaka [Index]…completed five waves up…and has since fallen below its uptrend line—probably a sign that a correction has begun in Bangladesh.” - Asian-Pacific Financial Forecast, Dec 31, 2010

“[A] correction has begun in Bangladesh.” - APFF, Dec 31, 2010

Rana Plaza collapses one day after inspector’s warnings are ignored, killing more than 1100 in nation’s largest industrial disaster.

PRICE FORECAST: “The Dhaka [Index]…advanced in five waves…to a high in 2010. Since then it has fallen in five waves and is now approaching the end of the decline.” - Asian-Pacific Financial Forecast, May 3, 2013

“[A] correction has begun in Bangladesh.” - APFF, Dec 31, 2010

“The Dhaka [Index]…is now approaching the end of the decline.” - APFF, May 3, 2013

Fractals

2009-present:

Australia

The Australian names PM Rudd “Australian of the Year” PRICE FORECAST:

“A political coup at the highest level…support[s] our view that [stocks are] approaching a significant low.” - APFF, July 2, 2010

Gillard Ousts Rudd

PRICE FORECAST: “Last weekend, The Australian appeared to give…a sell signal when it named Prime Minister Kevin Rudd ‘Australian of the Year’.” - APFF, January 29, 2010

Rudd Ousts Gillard PRICE FORECAST:

“Rudd’s overthrow of Gillard should mark another significant low in Australian social mood and stocks.” - APFF, June 28, 2013

PRICE & POLITICAL FORECAST:

“Ralph Nelson Elliott observed that sideways markets can wear participants down as much as declining markets can. So with the All Ordinaries only now emerging from a multiyear sideways move, social mood in Australia remains quite negative. And that explains why the incumbent Labor party’s prospects look increasingly bleak with just a week to go before the nation holds its general elections….From our different perspective, though, whichever parties form the government after the elections will likely enjoy a nice honeymoon, thanks to the upcoming rally.” - Asian-Pacific Financial Forecast, August 30, 2013

“The most dramatic, and disruptive, period of emerging market growth the world has ever seen is coming to its close. ” - Economist, July 27, 2013

“Although supposedly describing a new reality, the cover has, in fact, simply recognized an existing trend that is approaching its endpoint.” - APFF, August 2, 2013

CHINA IN DEPTH: The Technical Evidence

By Mark Galasiewski (gala-SHEV-ski)

Editor, Asian-Pacific Financial Forecast Elliott Wave International (EWI)

2013 Irrational Economics Summit

Hilton la Jolla Torrey Pines La Jolla, California, USA November 6-8, 2013

TECHNCIAL CONSIDERATIONS:

•  Elliott Wave Pattern •  Valuation •  Sentiment •  Momentum divergences •  Strength in growth sectors •  Bullish patterns in bellwether stocks •  Bullish patterns in other global markets

For a free sample of

Asian-Pacific Financial Forecast, visit:

www.elliottwave.com/wave/IES

THE END

9/11

OBL killed

underwear bomber

“News has a way of working into the market’s psychological patterns….If the anti-terrorist forces were to find bin Laden with the market still rising, it would be the kind of ‘news hook’ that caps advances. People often comment that the market needs a ‘catalyst’ of bad news to start a decline or good news to spark a rally, but such is not the case. The market’s relationship to the news is the opposite of this contention.”

bin Laden killed May 2, 2011

S&P 500 Oct 2010 - Oct 2011, daily bars

— Robert Prechter, Elliott Wave Theorist, December 1, 2001

“The ‘bears’ have now all completed five waves down since their 2007 highs, while the ‘potential baby bulls’ completed only three waves down from their respective highs, which makes them strong candidates to rally back to at least near their all-time highs—if not beyond.” – Asian-Pacific Financial Forecast, April 3, 2009

BULLISH DIVERGENCE AT THE 2009 LOWS

Definition of a Supercycle:

“A supercycle lasts 12 to 15 years and ties together three normal bull runs that last 3 to 4 years each. Each bull run is followed by a bear market – a correction in which a major stock index falls 20% or more from its peak. A bear market typically lasts eight or nine months.” – Investor’s Business Daily, August 27, 2013

The Australian names PM Rudd “Australian of the Year” PRICE FORECAST:

“A political coup at the highest level…support[s] our view that [stocks are] approaching a significant low.” - APFF, July 2, 2010

Gillard Ousts Rudd

PRICE FORECAST: “Last weekend, The Australian appeared to give…a sell signal when it named Prime Minister Kevin Rudd ‘Australian of the Year’.” - APFF, January 29, 2010

Rudd Ousts Gillard PRICE FORECAST:

“Rudd’s overthrow of Gillard should mark another significant low in Australian social mood and stocks.” - APFF, June 28, 2013

“From a contrarian perspective, all those crises appear to have marked the end of the correction.” - APFF, Aug. 2, 2013