Stocks were flat and mixed again Friday, October 22nd. The sideways move with a slightly down bias since early August with overlapping oscillating moves almost daily is characteristic of a typical wave b, d, or 4 Elliott Wave. This is helpful in identifying the price pattern occurring in the stock market. Given this reality, it is now clear that this move is wave d of a five subwave Rising Bearish Wedge from February 2016.

This is now the case in all three major stock indices, the Industrials, S&P 500 and NASDAQ 100. This wave d-down move is approaching its completion. It could have a bit more downside drift left in it. This wave could finish around the U.S. Election on November 8th.

This "line" pattern as Charles Dow would describe the move from August is set to lead to a sharp breakout, given that it is a large sideways move. Because stocks are clearly inside a Rising Bearish Wedge that we show in those charts, they need a wave e-up to finish this pattern. Therefore, the next breakout will be higher.

There should be a strong rally leg that starts after the U.S. election and lasts into year end to complete every degree of stock market price pattern topping now: the Rising Wedge from February 2016; the multi-decade Jaws of Death pattern (see next two charts below); and the Multi-century Grand Supercycle degree wave {III}.

Once stocks top, possibly around year end 2016, a massive equity market plunge will begin. This plunge could be triggered by a major war involving the Middle East. Israel's stock market index TA100 sports a very Bearish pattern, which we present to subscribers in this weekend's International Market Forecast Report at www.technicalindicatorindex.com . In fact most global stock indices are setting up for a grand decline, which we also show in that report. By marrying geopolitical events with stock chart patterns, it is a reasonable postulate that War is likely in 2017. In my book, The Coming Economic Ice Age, I correlate major wars with these topping price patterns. That is the precise scenario setting up for next year.

For those of you interested in Bible prophecy, there is an alarming set up right now for the Psalm 83 War event. That Psalm mentions the lead up events, the actors in that event, including Israel for sure, and the outcome. None of this was possible before Israel became a nation in 1948. For those of you who want to research this possibility there are some excellent commentaries available in books and DVDs at amazon.com that help understand the modern day actors that correlate with the Psalm. Essentially Israel is forced into a defensive war from an attack by Radical Islamic terrorism, which of course is stage set right now. This war may involve Nuclear Weaponry. But don't take my word for it, study this yourself if interested.

This is important to understand as it would certainly be a catalyst black swan that would send all global stock markets into panic selling in tandem, an event that market charts warn is coming. The perception of delay the past year is not reason to ignore the warning. Delay is a gift from God. Fed intervention in markets is not going to stop the selling if Nuclear war breaks out in the Middle East. All the Fed's horses and all the Fed's men will not be able to lift markets back up again.

There is a political movement gaining strength in the United States and Europe for a Western global alliance. One U.S. presidential candidate is clearly in favor of that progression, pushing that agenda during her tenure as Secretary of State. In fact, this election could be summed up as a choice between Globalism and American nationalism. This Western Global alliance could change what we now know as independent nationalist autonomous countries into member nation states within an umbrella confederation. This western alliance will not find favor with Israel, as our present administration has shown in many ways, including limiting weapons buildups in Israel as well as pushing for shrinking land occupancy and the internationalization of Jerusalem. Jay Sekulow, a regular guest contributor on Fox News, and his important organization, American Center for Law and Justice, ACLJ.org has some fabulous research on the current U.S. administration's unfavorable dealings with Israel in its pro Globalism agenda.

Israel will increasingly find itself isolated against foes that are adjacent neighbors and from distant powers such as Russia as well as this developing Western nation confederate alliance. Bible prophecy has a lot to say about these imminent geopolitical events, with the Psalm 83 war, which is likely next on the Biblical calendar, and the Ezekiel 38 and 39 war, which could follow. The actors and set up for these wars is already stage set, and I mention this because of the incredible timing and fit that stock market charts are warning at the precise same time. This narrative may not be politically correct, but it bears study by the prudent student of markets and world events.

So to recap, the next two large trend moves in stock markets are likely to be up strong and then down huge. The above narrative is an attempt at a possible explanation for the "down huge."

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Dr. McHugh's book, "The Coming Economic Ice Age, Five Steps to Survive and Prosper," is available at amazon.com at http://tinyurl.com/lypv47v

"Jesus said to them, "I am the bread of life; he who comes to Me
shall not hunger, and he who believes in Me shall never thirst.
For I have come down from heaven,
For this is the will of My Father, that everyone who beholds
the Son and believes in Him, may have eternal life;
and I Myself will raise him up on the last day."

John 6: 35, 38, 40