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Yes I saw that.
I think the article is interesting because of the evidence that they found
of the shift. Understanding the emphasis in your market I think is
important. Many of the commodities have psych boundaries such as these. You
might want to check how resting paper is related to the "psych barriers" Vs
the "tech barriers" i.e. 100 and 200 day MAs.
To others: This link may break on you and you may have to enter some of it
by hand.
http://www.elsevier.nl/cgi-bin/cas/tree/store/revfin/cas_sub/browse/browse.c
gi?year=1999&volume=8&issue=1&aid=1
>From the Intro ... page 74 (I edited some of the heavier stuff out)
"... Previous research concerning potential psychological barriers has
followed three
basic approaches .... As a barrier
is approached from below, daily returns may exhibit distributional shifts.
We hypothesize
that if many market participants view the barrier as a constraint, but one
which
is surmountable, this may give rise to increased technical trading which
would leave
a traceable impact on both mean and variance.
When the barrier is eventually crossed,
a further distributional shift occurs as the constraint on the mean is
lifted and technical
trading dies down. We further hypothesize that a corresponding series of
distributional
shifts may occur as an index moves downward through a barrier ..."
Best regards
Walter
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