Comments on: Out of Control and Highly Emotional: Alternative Views http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/ The Focal Point for All Traders Fri, 03 Sep 2010 10:54:23 -0700 http://wordpress.org/?v=2.9.2 hourly 1 By: Unersaettlich http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11671 Unersaettlich Mon, 17 Nov 2008 21:12:54 +0000 http://www.stocktock.com/?p=9422#comment-11671 Here's a link to a static image of a daily $SPX chart that adds a fourth alternative and expands on the white wedge: http://i33.tinypic.com/2i3xit.jpg (If you click on the image enough in the right place(s), you get a crisp chart that just fits the usual 1280x1024 screen) Link to live chart (probably requires subscription to stockcharts.com): http://tinyurl.com/576aey Besides repeating the white wedge and Tony's expanding triangle, this chart introduces a possible VERY bearish scenario, in which the S&P has been moving in a series of increasingly nasty downtrend channels (turquoise), the newest of which (dotted turquoise) is very ugly indeed (and is still intact at the close 16 Nov). It also shows how the white wedge can possibly be from a somewhat less ugly, but still dreadful, new downtrend channel which is still steeper than its predecessors. A breakout above the white top line could still be part of a horizontal chopping consolidation between 840ish and 1000ish that has persisted for some time (and maybe that's all there is, and we chart weenies are just drawing lines between coincidentally aligned points), but if we get significant action above 1000, then Tony's scenario comes into play. We can also see how the breakdown this fall of the 38.2% Fib between Oct 2007's top of 1576 and Oct 2002's 770ish bottom led to the nasty plunge from 1265 to 840ish in three weeks. Whatever happens from here, it doesn't feel to me as though we are finding a bottom, more like an exercise in "Continuation Patterns 101": http://www.youtube.com/watch?v=QNAx600JzCI Just as we see consolidations after rapid big rises before the upward action resumes, we are probably getting a chance to sell long positions into the top of the chop and be ultrashort until the next swing bottoms, then either get long again or be a coward like me and sit on cash. Here’s a link to a static image of a daily $SPX chart that adds a fourth alternative and expands on the white wedge:
http://i33.tinypic.com/2i3xit.jpg
(If you click on the image enough in the right place(s), you get a crisp chart that just fits the usual 1280×1024 screen)
Link to live chart (probably requires subscription to stockcharts.com):
http://tinyurl.com/576aey
Besides repeating the white wedge and Tony’s expanding triangle, this chart introduces a possible VERY bearish scenario, in which the S&P has been moving in a series of increasingly nasty downtrend channels (turquoise), the newest of which (dotted turquoise) is very ugly indeed (and is still intact at the close 16 Nov). It also shows how the white wedge can possibly be from a somewhat less ugly, but still dreadful, new downtrend channel which is still steeper than its predecessors. A breakout above the white top line could still be part of a horizontal chopping consolidation between 840ish and 1000ish that has persisted for some time (and maybe that’s all there is, and we chart weenies are just drawing lines between coincidentally aligned points), but if we get significant action above 1000, then Tony’s scenario comes into play. We can also see how the breakdown this fall of the 38.2% Fib between Oct 2007’s top of 1576 and Oct 2002’s 770ish bottom led to the nasty plunge from 1265 to 840ish in three weeks. Whatever happens from here, it doesn’t feel to me as though we are finding a bottom, more like an exercise in “Continuation Patterns 101″:
http://www.youtube.com/watch?v=QNAx600JzCI
Just as we see consolidations after rapid big rises before the upward action resumes, we are probably getting a chance to sell long positions into the top of the chop and be ultrashort until the next swing bottoms, then either get long again or be a coward like me and sit on cash.

]]> By: Unersaettlich http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11458 Unersaettlich Mon, 17 Nov 2008 09:39:19 +0000 http://www.stocktock.com/?p=9422#comment-11458 This guy discusses the weakness and its sources at length and also uses my third pattern above (on the Dow instead of the S&P): http://www.shadowtrader.net/videos/sunday111608st.html This guy discusses the weakness and its sources at length and also uses my third pattern above (on the Dow instead of the S&P):

http://www.shadowtrader.net/videos/sunday111608st.html

]]> By: Unersaettlich http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11457 Unersaettlich Mon, 17 Nov 2008 09:36:28 +0000 http://www.stocktock.com/?p=9422#comment-11457 stockcharts.com and thinkorswim.com seem to be the charting sites most people use. stockcharts.com just announced something to do with cell phones. I like stockcharts.com because it gives me a lot of control over parameters of indicators. I can use BB(140,2) to generate 20-day, 2 SD Bollinger bands on an hourly chart or even something as weird as MA(325) to put an approximate 5-week MA on a half-hour chart (5 weeks x 5 days/wk x 13 half-hrs/day = 325 half-hrs per 5 weeks). I don't know why one might want to do that particular voodoo, but similar stuff has helped with recent charts, where half-hour indicators have been useful (to me), regardless of the chart interval, so I used MACD 24,52,18 and MACD 6,13,5 to generate a half-hourly MACD 12,26,9 on a 15-min chart and on an hourly chart. stockcharts.com and thinkorswim.com seem to be the charting sites most people use. stockcharts.com just announced something to do with cell phones. I like stockcharts.com because it gives me a lot of control over parameters of indicators. I can use BB(140,2) to generate 20-day, 2 SD Bollinger bands on an hourly chart or even something as weird as MA(325) to put an approximate 5-week MA on a half-hour chart (5 weeks x 5 days/wk x 13 half-hrs/day = 325 half-hrs per 5 weeks). I don’t know why one might want to do that particular voodoo, but similar stuff has helped with recent charts, where half-hour indicators have been useful (to me), regardless of the chart interval, so I used MACD 24,52,18 and MACD 6,13,5 to generate a half-hourly MACD 12,26,9 on a 15-min chart and on an hourly chart.

]]> By: Surage http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11411 Surage Sun, 16 Nov 2008 21:43:18 +0000 http://www.stocktock.com/?p=9422#comment-11411 Any decent brokerage account provides sufficient tools to do any analysis. Any decent brokerage account provides sufficient tools to do any analysis.

]]> By: Jeff Graubart http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11406 Jeff Graubart Sun, 16 Nov 2008 20:35:12 +0000 http://www.stocktock.com/?p=9422#comment-11406 I believe the PPT was influencing the market through the election, but with the election over, there is no more reason to believe in any coordinated manipulation. The Democrats would prefer a crash now as opposed to later and the Republicans don't care one way or the other. Assume that all the forces now are real and natural. We all have bad days and the ever-changing patterns are due more to high-speed internet communication of the latest pattern of the hour than some evil hand. I believe the PPT was influencing the market through the election, but with the election over, there is no more reason to believe in any coordinated manipulation. The Democrats would prefer a crash now as opposed to later and the Republicans don’t care one way or the other. Assume that all the forces now are real and natural. We all have bad days and the ever-changing patterns are due more to high-speed internet communication of the latest pattern of the hour than some evil hand.

]]> By: Tom http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11393 Tom Sun, 16 Nov 2008 16:38:19 +0000 http://www.stocktock.com/?p=9422#comment-11393 thanks gr. That was great. thanks gr. That was great.

]]> By: gr http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11391 gr Sun, 16 Nov 2008 14:39:57 +0000 http://www.stocktock.com/?p=9422#comment-11391 the link: <a href="http://commoditywatch.podbean.com/" rel="nofollow">http://commoditywatch.podbean.com/</a> the link:
http://commoditywatch.podbean.com/

]]> By: gr http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11390 gr Sun, 16 Nov 2008 14:37:52 +0000 http://www.stocktock.com/?p=9422#comment-11390 a market historian's perspective well worth to heed to: <a><b>A Bounce IS Due?</b></a> a market historian’s perspective well worth to heed to:
A Bounce IS Due?

]]> By: Shanky "Mr. Not So Long -again" http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11387 Shanky "Mr. Not So Long -again" Sun, 16 Nov 2008 13:53:57 +0000 http://www.stocktock.com/?p=9422#comment-11387 Nice charts. I'll follow all three scenarios. I prefer the last two. If they breakout to the upside then Tony C's is in play. I do not like Tony's because I do not think there is enough buyers to complete his formation. If bulls could not push the market up friday it's not going up. There were multitude of TA formations that led to a breakout Friday and the all failed. Back in perma bear mode. Nice charts. I’ll follow all three scenarios. I prefer the last two. If they breakout to the upside then Tony C’s is in play. I do not like Tony’s because I do not think there is enough buyers to complete his formation. If bulls could not push the market up friday it’s not going up. There were multitude of TA formations that led to a breakout Friday and the all failed. Back in perma bear mode.

]]> By: Shanky "Mr. Not So Long -again" http://www.focalequity.com/2008/11/15/out-of-control-and-highly-emotional-alternative-views/comment-page-1/#comment-11386 Shanky "Mr. Not So Long -again" Sun, 16 Nov 2008 13:46:49 +0000 http://www.stocktock.com/?p=9422#comment-11386 Correct, but TA can allow you to attempt to predict movements such as breakouts or breakdowns and also support and resistance. I find it invaluable in determining direction and entry and exit points for trades. Take a look at daily chart BAC. For those that got caught in the value trap earlier this year, it could have been avoided. There was a clear symetrical triangle that fromed from Jan thru may that indicated the future breakdown of BAC. TA can be invaluable in making bothe purchasing and sell decisions. Correct, but TA can allow you to attempt to predict movements such as breakouts or breakdowns and also support and resistance. I find it invaluable in determining direction and entry and exit points for trades. Take a look at daily chart BAC. For those that got caught in the value trap earlier this year, it could have been avoided. There was a clear symetrical triangle that fromed from Jan thru may that indicated the future breakdown of BAC. TA can be invaluable in making bothe purchasing and sell decisions.

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