It looks to me like we can expect the INDU to be trading down to at least 8300 (a new magnet created today) on Sunday or at the open on Monday. 

Every single person I read about seems to be saying the bottom is in place so it’s not surprising that they’re going to be stubborn here but, mark my words, when they run out of bullets–and the market has only treaded water–they’re going to realize that they screwed up and this thing is going to crash again. 

The perma-bulls (they are buried by 50-70%) are still saying to buy, and now even long-time bears like David Tice, Doug Kass, and Bill Fleckenstien have either respectively sold their funds, flipped to the bull side or left the table with their pocket’s full of cash.  In other words, even without the advantage of my model, I don’t see a lot of evidence of any type of washout whatsoever.  The fact that even these bears are in essence picking a bottom, tells me there’s a lot more to be had on the downside. 

Two important developments today and BOTH of them were created due to the market’s stubbornness up here.  The model always has a “pay me now or pay me later” approach with regard to its forecasts and if they want to be stubborn one day, they pay dearly for it the down the road.  That’s just the nature of its mechanics. 

Anyway,  the model says we’re going to continue to crash into Feb and April of 2009 and the long-standing target for 2011-2015 (3971) just moved up into the February 2009 to April 2009 time slot.  I NEVER would have guessed this would happen but we can thank the FED and Treasury because they’re the ones who created the complacency that will be the catalyst that takes us down in a series of crashes into early next year. 

The targets for 2008 remain INDU 6426 and SPX 680 but–again because of the stubbornness of the market–it’s now possible that we’ll see at least an intraday print at DOW 4800. 

Happy weekend…

Full report coming soon