Even non-sports fans have heard by now about the recent debacle known as Baseballgate.
With two outs in the ninth inning, a first-base umpire called "SAFE" when the runner was clearly "OUT." But this was no ordinary missed call; it cost Detroit Tigers pitcher Armando Galarraga a perfect game.
And as the blogosphere flooded with memories of other historic slip-ups that cost "so and so" star "this and that" honor. Demands for the commissioner of baseball to reverse the bad call grew louder by the hour.
It was indeed a very bad call. But the biggest, baddest call of all was not made on a sports field. It was made in the field of finance -- specifically on the stock market. To wit: The mainstream umpires of finance stood near first base, and in April made this emphatic call for the uptrend in stocks:
"SAFE!!"
In case you missed the event, here's an instant replay:
- "Stocks Remain In A Powerful Bull Market." (April 10 Bloomberg)
- "Stocks Haven't Lost Their Appeal As The Market Goes Up, Up, And Away." (April 21 US News & World Report)
- "You can use any number of words to describe this bull market. Frothy is not one of them. This market is reasonably priced." (April 21 AP)
- "US Stocks Post Longest Winning Streak Since 2004. The recovery should be sustainable and that will drive the market." (April 24 Bloomberg)
- "All the economic reports are pointing up... despite lingering worries over debt problems in Greece. Right now, there is virtually no evidence of a top." (April 30 USA Today)
Yet from its April 26 peak, the DJIA turned down in a jaw-dropping 1000-plus point selloff. The market suffered its worst May since 1940.
The markets have no commissioner to reverse the bad call of the financial mainstream. But at least one team of analysts remained ahead of the most game-changing moves in the world's leading stock market, including a forecast that called the rally "OUT" in April 2010. Consider the following insight from EWI President Robert Prechter:
On April 16, Prechter published his April Elliott Wave Theorist titled ""Deadly Bearish Picture." Notice the dates.
"We can project a top...between April 15 and May 7, 2010. It is rare to have technical indicators all lined up on one side of the ledger. They were lined up this way -- on the bullish side -- in late February-early March of 2009. Today, they are just as aligned, but on the bearish side."
April 26 marks the high for the DJIA, followed by the devastating drop on May 7 -- exactly within the date range Prechter's forecast called for.
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