COMMENT: Mr. Armstrong, I attended the Berlin Conference and I must say, you told us to expect a move between the Benchmarks in gold, and that the first quarter looked to be a countertrend move. You seem to be able to map out the direction of markets all the time. I am still working out the best way to read the arrays. But I have to ask. Why have you not been given the Noble Prize with such a long track record that is unbeatable?

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REPLY: The fact we can forecast any event to the day PROVES that markets are by no means RANDOM. Now, lets begin with that statement and follow it through. If markets are NOT random, then the implication for government, economics, fund management, and all social sciences are actually incorrect sciences if you lower the real meaning of that word to be just opinion. This means central bank manipulation cannot succeed. It means government cannot control society under the Marxist-Keynesian theories, and it means that low and behold Adam Smith was correct after all. Giving me the Nobel Prize for proving so much is seriously in error, would be tantamount to a real scientific revolution. I think we are not ready for that. We have to crash and burn FIRST. Then perhaps in the aftermath someone will say – hey; let’s try something different. The downside of humanity is we want someone to be in charge. That is our own careless mistake in history.

The degree that those in power BELIEVE in the ability of the power to control society by merely writing a law is identical to desperate goldbugs who still write and have dedicated their life to try to prove me wrong on anything to justify being wrong themselves for 19 years from 1980 and 5 years from 2011, besides the fact the Dow rose from 1,000 to 18,000 since 1980 and gold cannot even exceed the 1980 high adjusted for inflation. They still write with pathetic nonsense demonstrating that no matter what you show them, they will NEVER change their mind. This is exactly the same as politicians. Nothing you do to show them they are destroying the economy to change their mind, creating massive unemployment among the youth, and the negative interest rates are undermining pensions and wiping out the elderly. There are those who, as Smith states, are hopelessly lost committed to their self-interest and REFUSE to ever see that they are possibly WRONG. This is why markets must crash and burn. It is the ONLY way to promote change.

Now with respect to the arrays, we are in the process of preparing a workshop series. But to make it as simple as possible, just focus on the top line which is the sum of 72 models. The plotting of the bars is proportional to that time frame. As the time moves forward, one bar which may not have been so pronounced, will suddenly rise. This is because the plotting is relative to the highest bar in that time segment. Where the highest bar may have been 25 hits previously and now the highest is only 10, it may appear to now be also at the top. We are looking at reflecting the count so you can see this is proportional charting, not relative to some fixed standard.

The change in the color reflects only direction. Here we see the 8th, a change for the 9th, and then the 12th. If we break the low of the 9th and close lower, then it is likely that 3 day trend will be to the downside. Exceeding the high of the 9th and closing higher would imply the risk is a 3 day rally into the next target on the 12th. These bars reflect the sum of all models which are “turning points” rather than a specific high or low given there are cycle inversions. This is typically determined by other models reflected in the text written by the computer.