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Commodity Prices Can’t Go Up Before They Go Down Even More: An Interview With Peter Goodburn

by m.tamosauskas| November 24, 2014 | No Comments

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Dear Elliott Wave enthusiasts,

At specific times in the development of an uptrend, the Elliott Wave analyst will find themselves in a ‘contrarian’ position to the underlying economic fundamentals that have given support at various stages of a bull market. This is also true in a downtrend, a bear market. This point of contrarianism for example, occurs at the termination level of a five wave impulse pattern – the ‘deterministic’ concept of price-predictability is the foundation of the Elliott Wave Principle (EWP) that builds from Nature’s Law. And so when a five wave impulse pattern is approaching termination, the EW analyst is forewarned to expect a sudden directional change. This most often ‘leads’ the fundamental news-flow but at other times, it is timed to some significant exogenous event that triggers the directional change. We don’t always know what the specific event will be, except that something, somewhere will suddenly emerge to qualify what we can already see developing, changing from the completion of an Elliott five wave pattern.

Economics is not always seen as a good mix with the concepts of the Elliott Wave Principle because they seem to be opposite philosophies – the EWP is developed around the qualities of non-linear alternation models of growth/decay, progress/regress within a hierarchical seamless development of patterns that are both fractal and geometrical – whereas economists attempt to gain an understanding of the same phenomenon, price trends, through studies of production, distribution and the consumption of good and services. But as we have witnessed during the last several years, especially following the financial-crisis sell-off and the subsequent efforts of Central Banks to stimulate the global economies through relaxed monetary policies, it is imperative the EW analyst pays attention to what is actually happening to the fundamental news flow and understanding how this interacts with the wave patterns that evolve.

Finding your way through the labyrinth of economic data or fundamental opinion is an almost impossible task to differentiate the good from the bad. My philosophy is always this – search for the best and when there is a good flow, go with it. Now I’d like to introduce you to an economist of excellence, Gail Fosler. Gail was the former president of the U.S. Conference Board and was instrumental in developing and distributing Leading Economic Indicators from the U.S. Department of Commerce. The Wall Street Journal twice named Gail as America’s most accurate economic forecaster and she has since established her own economic consultancy, advising governments and business leaders alike.

During the last few years, I’ve had the privilege of discussing a whole array of financial topics with Gail and even though we both come from very different financial philosophies, amazingly we found common ground and mostly because we wanted to listen, learn and develop with an open mind. I’ve written about various topics related to the ‘Inflation-Pop’ over the last few years, and Gail has kindly published through her network of contacts and on her website. And now, we’d like to share some latest insights on this same subject with you. Gail interviewed me recently so that we can update the ‘inflation-pop’ and how this will specifically affect commodity prices during the next few years. The article is clear and concise in Gail’s easy language which is a great credit to her for distilling the complex into something we mere mortals can understand. So take a look at the interview now…click on the links below to read the article and see a few newly update Elliott Wave counts. And while you’re at it, take advantage of reading some of her other material – you won’t regret it.

http://www.gailfosler.com/

http://www.gailfosler.com/interview-peter-goodburn

All the very best,

Peter Goodburn

Category: Copper, Emerging Markets, GDX, Gold

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WaveTrack International is a financial price forecasting company dedicated to the Elliott Wave principle and work of the R.N. Elliott. Clients include Investment Banks, Pension Funds, Total/Absolute-Return/Hedge Funds, Sovereign Wealth Funds, Corporate and Market-Making/Trading institutions and informed individuals -- & just about anyone who is affected by directional price change.

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