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It seems clear to me that from here the prudent course is to wait for a
significant direction to confirm a break one way or the other. However, I
remember being a market-maker on the floor of the PSE when the Dow crossed 1000.
We were able to make money on the short term swings and made a living when there
wasn't a raging bull market. Even if we don't see a strong move, we can survive
trading the congestion.
Only my opinion,
Lawrence Price
TradeWynne@xxxxxxx wrote:
> In a message dated 5/26/00 6:51:34 AM Pacific Daylight Time, staylor@xxxxxxx
> writes:
>
> > Not doubting that it's there, but I am having to squint hard to see a H&S
> > on the daily NAS
>
> Yeah, it's got a very pointy head (remember "Cone Heads," on Saturday Night
> Live?), it looks a little fuzzy to me too.
>
> FWIW, in the NDX there is a (nearly) two year trendline cutting through near
> 3000 and so far it's holding on a daily close basis. Moreover, "predicting" a
> bear market after a nearly 38% decline (4816 - 38% is +/- 2976) is a bit like
> being a weather man, walking outside at 11AM (getting wet), and then
> forecasting a 62% chance of rain.
>
> I can hear someone out there saying you are not supposed to calculate Fibos
> from zero, but there is a historical precedent: the DJI print high in 1987
> was 2722, and a 38% decline would have been near 1682. There is some argument
> as to the actual lows on the 1987 crash (1707 print, 1616 theoretical), but
> it was close to 38%. Oh yeah, and that was a bit less than two months after
> the August 1987 peak (NDX peak this year was 3-24 intraday, 3-27-2000 closing
> basis ;-).
>
> I am not saying this the low! I truly do not know yet. I'm just offering
> some facts. I agree this is a critical area, and that it is wise to let the
> market tip its hand. Even a bear market bounce could produce a 1000 point
> rally (62% of this decline is near NDX 4100).
>
> Bill Wynne
> SmartTrades.com
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