I just want to post a snippet from Rob McHugh's market analysis. He's been very accurate in predicting this recent plunge, and is now calling for one of the following three scenarios over the next week, two of which would take us below the 2002 lows in the DOW. If that happens, I wouldn't be surprised to see these already depressed juniors a little more depressed. If it does happen, it will probably prompt another coordinated massive rate cut, and other massive money printing:

I don't mean to scare you tonight, however there is a set-up scenario where we could see a panic plunge, another crash leg, a market meltdown that is simply terrifying over the next three to four days. Last night we presented three scenarios calling for a plunge of at least several hundred points that was imminent. We wrote, "Any way we cut it, we should see one more sharp decline, either several hundred points, or several thousand, starting between now and late next week." The Industrials went out and plunged 733.08 points Wednesday.

The first scenario is where the coming phi mate turn date is a top, with a 2,000 point plunge starting next week. If that scenario is occurring, it means wave 4 up is forming a symmetrical triangle, which requires a series of volatile reversing waves, like we have seen so far this week, the first leg up of the triangle the rally Monday and Tuesday; the second of five waves, Wednesday's sharply sell-off. This scenario requires three more reversing "sideways" waves occurring over the next several days, then wave 5 down starts next week at our phi mate turn date, scheduled for October 23rd +/-. That decline could be 2,000 points +/-.

Two other scenarios: One is a catastrophic crash leg that could take the Industrials down to the 6,000's +/-, and the S&P down to 600 +/- over the next few days, which would seem like a complete market meltdown. That would be wave 5 down, of e down of a-down. It suggests wave 4 topped Tuesday, October 14th. It would bottom next week around our coming phi mate turn date. The carnage would be devastating. There are no signs of a final bottom here, precious few buy signals from our many key indicators, so this scenario is frighteningly possible.

The third scenario, is that wave a-down bottomed Friday, October 10th, and that Wednesday's plunge is a nearly completed correction of the first leg up of Minor degree waved b-up which started intraday Friday, continued Monday and finished Tuesday morning. That scenario requires an immediate and powerful rally. A break below 7,882.51 eliminates this most optimistic scenario.

Hysteria