Prechter: Wave 3 is Broader and Stronger, Deflation Gaining Upper Hand Again

Robert Prechter, founder of Elliott Wave International, hasn't really changed his views since last year. Did QE2 backstop wave 3? The S&P is actually right back where it was before QE2 started. During his CNBC interview he said, "if the decline of 2007-2009 was the first wave down, under the Elliott Wave model the second decline, which we call the third wave, is usually a lot broader and a lot stronger, so that's why I was trying to position people for a really dramatic turn to the downside, and probably one that's going to last a while" (through 2016). He also said "deflation is gaining the upper hand again" and to stay in cash or short rallies. He thinks we are in the early stages of a depression, but sees one of the greatest buying opportunities ahead. I embedded the video from Elliott Wave's site after the jump (w/ EW's news feed).

Prechter Discusses Market Forecasts on CNBC's Closing Bell with Bill Griffeth

Elliott Wave International news feed...

Prechter was also interviewed by Tom Keene on Bloomberg TV on August 11.