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[cat] 02/11/2003 22:57

lmao - so what?
Surely if the market reverses we all close our longs and go short. Whats the big deal?
The best thing to do must be to let the market take us into positions and not try to anticipate it.
Simple things work.

[cat] 01/11/2003 14:35

Market tops look like market tops...........but only after they have been created. Trying to predict whats goin to happen is a mug's game. I had a go for a few months last year and now realise what a plonker I was.

Reassuring to see this thread running all the time whilst the market climbs the wall of worry....

[thedickster] 01/11/2003 09:55

just a simple observation looking at the Dailies on the Dow, recent trip up from 9500 to 9850 happened marginally quicker than the corresponding trip down from 9850 to 9500, and on marginally higher volume. Also the 30, 15 and 5 MACDs look as though they might pop to the upside, and the daily looks as though it might fire a buy signal......beware the word "look" though, indicators are indications , and nothing else as we all know. The daily observations suggest that if there is a decline, it may well be met by dip buyers.Friday night didn't "feel" like a major top, it seemed very content at its level for nearly all of the session.

[energyi] 01/11/2003 08:43

FRIDAY was the last day of the month, and volume was light.
Month-end WINDOW DRESSING helped hold the market up, and we now
have a pattern with very tight Bollinger Bands:

...
In the past, we have seen sharp falls (and a few sharp rises) as
the price action moves out of the tight Bolly Range.

I now have record large Short positions, virtually all through puts,
which are CHEAP (in terms of implied volatilities)

[energyi] 30/10/2003 17:02

DOW Short Term Chart (5 min)
...shows that Classic Double Right shoulder, just below 9800

[hooya] 30/10/2003 15:33

Maybe something here. I guess we will find out in the next session or so.

But High with volume spike with a market low volume spike greater than the lower high's volume spike?? (60 min chart)

[energyi] 29/10/2003 15:31

THE 1987 TOP: was a Classic Double Right Shoulder: v-V-^-!

...
But the 1stRS was a low one, and the 2ndRS
came in at a level which was between the 1stRS and the LS
...
WHAT HAPPENED NEXT: Sharp fall on Rising Volume

[energyi] 29/10/2003 15:05

THE NASDAQ-2000 TOP... was more like: v-V-v,
with two right shoulders, BOTH after the Warning Drop to NAS-3000

[energyi] 29/10/2003 14:42

THE TOP IN Dow-2000... was similar,
but it tool longer for the second Right Shoulder to arrive:



This was a: w-w-V-^-! pattern

NOTE: that the 2ndRS (^) came to exactly the same level as the 1stRS

[energyi] 29/10/2003 12:17

THE NATURE OF TOPS...
Is that they are very hard to SELL because the shorts get
frightened into covering, and it looks like more upside is right ahead.

DOUBLE RIGHT SHOULDER (wV^!) seems another characteristic,
and we are seeing this in the DAX NOW!


In Line: w-V-^-!:
w: 1) Classical Head-and-Shoulders Pattern ("The HAS Top") ending Wedge
V: 2) Trendbreak below Wedge with downswing in RSI etc. (the "Warning")
^: 3) Short-killing rally back to the Right Shoulder (the "2nd RS")
!: 4) Sharp drop below the "Warning" level (the serious "Selloff")
...
Note: A similar pattern arose at the March/April Low, but was Inverted

Am I "on to" something here? What do you think?

[energyi] 29/10/2003 07:10

Back to the Breakdown point:

[theape] 29/10/2003 01:20

or this taking the bottom as 0.

[energyi] 29/10/2003 00:30

Levels: SPX .. Time/Date.. .Dow.-.Date ..NDX..-.Date
High 1553.11. (03.24.2000) 10674-03.19 4816.35-03.24
Low : 768.58. (10.10.2002) 7,197-10.10. 798.17-10.07
Chg.: 784.53.. 30.6 months 3,477- 30.7 4018.18- 30.8
38.2% 299.69.. 11.7 months 1,328- 11.7 1534.94- 11.8
TARG 1068.27. (10.01.2003) 8,525-10.02 2333.11-10.01
Act. 1043.99. (10.16.2003) 9,819-10.16 1422.28-10.13
Retrace 35.1% ....39.9%... 75.4%-xx.x% . 15.5%-xx.x%

[energyi] 29/10/2003 00:21

Back to that QQQ-$35.50 level today
(see the top chart)

[energyi] 24/10/2003 23:31

Today's action has set-up a rally,
could be brief


If volume is light into next week... the drop down may come fast.

According to T.O'Brien, gaps on top need not be filled

[energyi] 24/10/2003 08:58

Looks like we got the Blow=off top on Oct 15th, as hypothesized.
Hindsight chart added

[jdeltablues] 20/10/2003 12:00

You're welcome. Talking of old books like Gartley, I recommend "Tape Reading and Market Tactics" by Humphrey B. Neill, which explains this kind of thing very well (better than I did anyway!).

This book was written between November 1930 and February 1931 and there's an amusing passage where he says in effect "I'm not going to spend a lot of time discussing bear markets as the current one has clearly exhausted itself". The Dow was then around 40% off its peak and appeared to be stabilising; unfortunately, the world economy collapsed in 1931 in a wave of protectionism and the Dow was to fall another 75% before finally bottoming out in 1932. (NB I'm not comparing the present situation to November 1930, just pointing out that even very skilled and experienced market observers can get it completely wrong).

[energyi] 19/10/2003 22:11

thnx, delta.
Good comments

[jdeltablues] 19/10/2003 21:37

Just catching up...

"People equate rises with greed and falls with fear, and yes greed on a new rising market should be slow because investors are likely to be slow because they fear a risk of losing, but speed up when the greed is motivated by fear of missing out, so shouldn't tops be rapid as in late 1999?"

Yes, this is how spike tops are formed; this kind of fear-driven greed is usually only seen near the top of major bull markets, which is why this kind of top is fairly rare. Much more common is the kind of top where the greed of the buyers is matched by the fear of losing profits from those who got long earlier, and the market goes sideways until the second group dominate (assuming they do dominate, but then it won't be a top if they don't!).

"The past 6 months have been marked by the speed of the rise- so what has been the dominant emotion over the past 6 months? Has it been professional speculative greed of the few as their cash returns. I can't believe that mass greed has returned."

I'd say it was initially driven by short covering, and some of the funds who've been religiously buying every dip of the bear market and finally got lucky, and then the kind of trader that jhurbanek used to be - no offence intended to anyone! (Obviously there were other types of traders and investors active as well, but IMHO those were the ones who were dominant). I would agree that the people who don't watch the market much are still out; in fact I'd guess that most of them haven't even noticed the rally, if the rest of my family is anything to go by.

"A fall is thought to be swift because it is motivated by fear, but fear paralyses investors and so shldn't a fall be slow until the final capitualtion when holders can take no more and sell."

Yes, this has been typical of the falls in the bear market; if you look at them, they often start by wobbling, trying to recover, then wobbling a bit more, starting to fall and accelerating until they're almost going down vertically, then bouncing back so sharply that it's impossible to catch. Falls in a bull market tend to be seen as buying opportunities, and the "wobble" usually results in a steady recovery, quickly followed by new highs for the move.

"Actually, I don't know and think I tend to see tops as less obvious."

Yep, calling tops is even harder than picking bottoms.

[niggle] 18/10/2003 19:32

and this one, yawwwwn