IRAQI CRISIS MIGHT NOT BE OVER...

Likewise, the NYSE index closed at its upper trendline and also closed just above the psychologically important 500 mark.

The stock market reached upper resistance today while the long-bond yield bounced off of the psychologically important six percent mark this afternoon and the Utilities index tested its 1993 all-time high. Importantly, interest rates formed an Elliott Wave diagonal triangle into the low at 6% today- something that indicates a sharp reversal from here, i.e., interest rates are about to spike.

It would not be surprising to see a significant turning point here in all of these markets, i.e., stock and bond prices are going to decline, while interest rates rise along with gold and oil prices.

If my Elliott Wave count is correct, we are just finishing wave-c of wave-2. Therefore, a wave-3 crash could come next. This might be a Grand Supercycle crash and associated global war.

It is odd how this turning point in the markets is occurring as the Iraqi crisis seems to have dissipated. A military conflict in the Middle East would cause rising oil and gold prices along with falling stock and bond prices like I expect.

One possibility is that Russia has only reached a seeming agreement for Iraq to back down in order to look like the peace- maker while the U.S. is still somehow going to be provoked into acting as a war-maker. That way, if "Saddam's Revenge" and World War III takes place here, Russia will look as blameless as could be and the U.S. will look as blameworthy as could be.