close icon

Greece? Greek Stocks? Why Not!

Greece is in trouble. The biggest trouble in its financial history. The country just missed a payment to the International Monetary Fund and is now asking its people whether to continue paying its debts or not. The banks will not open for a second consecutive week, because, as “The Telegraph” claims, they are down to their last 500 million euro. A liquidity crisis at its worst. The complete default of Greece seems inevitable. The Greek stock market only adds to the dark picture. In September 1999 the Athens Stock Market General index reached an all-time high of 6355 index points. Today, while the index is trading around the 800 mark, those levels are hard to imagine. But wait for a minute. Think about this: in 1999, levels around 800 seemed unreal as well. In October 2007, the year the Great Recession started, the Greek general stock market index reached 5334 and everyone was expecting the rally to continue. Instead, prices began declining. And just like nobody was expecting a sell-off in 1999 and 2007, nobody is expecting a recovery now. Well, the Elliott Wave Principle suggests we should be. The chart below explains why.
greece stock market
In theory, each bear market is nothing more than a large correction of the larger uptrend. In terms of the Wave Principle, each correction (except for triangles) consists of three-waves, labeled A-B-C. Once the correction is over, the larger uptrend resumes. Keep that in mind and take a look at the chart again. It appears that the correction in the Greek stock market, which started in September 1999 and is still in progress, is an A-B-C zig-zag pattern, where wave C is in its final stages. So, following the same logic, it turns out that once wave 5 of C is over, the Athens Stock Market General index should start rising, despite all the problems Greece has to take care of.

As John D. Rockefeller once put it, “the way to make money is to buy, when blood is running in the streets.” Of course it is a metaphor. We hope there will not be blood running in Greece’s streets. What Rockefeller meant is that we should stay positive, when the situation looks so hopeless that no-one else is. Because no trend lasts forever.

Stay informed with our newsletter

Latest Elliott Wave analysis on different topics delivered to you weekly.

Privacy policy
You may also like:

DAX 30 Surged 50%+ in Three Months. Here is Why

THIS WEEK ONLY, in addition to the seven premium instruments, all our subscribers will receive ONE Elliott Wave analysis of DAX 30 as a BONUS. Subscribe NOW and get yours on Sunday, June 14th. The last time we wrote about the German DAX 30, the index was in a free fall. It was March 2nd…

Read More »

Elliott Wave Setup Sends S&P 500 12% Higher

As demonstrated in our previous article about the S&P 500, the stock market started climbing while the economy looked the weakest. Then, as the markets kept rising, a new conundrum occurred. How to explain the extremely wide disconnect between the stock market and the economy? GDP forecasts for Q2 are all over the map, ranging…

Read More »

Insurance ETF Nearly Halves As COVID-19 Takes Toll

Maybe only with the exception of grocery stores, one can hardly find a stock not suffering from the COVID-19 disaster. Insurance companies were not spared either, so it is no surprise that the SPDR Insurance ETF (KIE) crashed, as well. This ETF, which ranks Progressive and Brown & Brown among its top holdings, lost 46.1%…

Read More »

Another Nightmarish Week, Another Illogical S&P Surge

As COVID-19 spreads across the U.S., the economy is teetering on the verge of collapse. Initial jobless claims came in at 6.6 million yesterday, bringing the three-week tally to nearly 17 million. The unemployment rate is estimated to have already surpassed its 2008-2009 recession level. Economists at Goldman Sachs, Morgan Stanley and the IMF predict…

Read More »

S&P 500 Elliott Wave Analysis Giveaway

The S&P 500 crashed by as much as 35% in just one month. And while the coronavirus outbreak was totally unpredictable, the crash it caused made perfect sense. Elliott Wave is our favorite method of analysis, but as the market kept rising we decided to back it up with fundamental data. The result was a…

Read More »

S&P 500, Against All Logic, Re-Enters Bull Market

The coronavirus pandemic forced the global economy to grind to a halt. Major U.S. stock market indices made their fastest plunge into bear market in history. In less than two months, DJIA and the S&P 500 lost 38.4% and 35.4%, respectively. “The virus is just starting to spread in the United States, the market is…

Read More »

Dow Jones Transports Ready for a Rebound?

The coronavirus pandemic is wreaking havoc on the global economy. Governments are closing malls, restaurants and literally all kinds of social gathering places, and even putting entire cities on lockdown. In the meantime, stock market indices are in free fall. The S&P 500 is down 28.7% YTD and the Dow Jones Industrials lost 35.2% since…

Read More »

More analyses