|
PureBytes Links
Trading Reference Links
|
Attached is an updated chart to accompany Walt's analysis and forecast for
the end of July.
BobR
At 10:41 PM 7/28/97 -0700, you wrote:
>I don't think so. His post seemed to have been in reply to Walt's Fear
post (below)
>
>Date: Fri, 11 Jul 1997 00:51:51 -0400
>Reply-To: knight@xxxxxxxxxxxx
>Sender: owner-realtraders@xxxxxxxxxxxxxx
>From: Walt Downs <knight@xxxxxxxxxxxx>
>To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
>Subject: Re: GEN - FEAR indicators
>
>bobrabcd@xxxxxxxxxxx wrote:
>>
>> Walt, I think it would be interesting if you would interpret the attached
>> chart of the SPX with your FEAR indicators applied.
>>
>> Thanks,
>> BobR
>
>Bob,
>
>I would be happy to. :)
>
>In starting, lest there be any confusion, the numeric values you
>see at the top of the chart are NOT the price plot values.
>What you are seeing are some of the ratio calculations.
>
>1. ) As can be expected in a runaway bull market, the larger specs
>(RED and YELLOW) are leading the way.
>
>2.) Notice, that in the run up, each time the CYAN (SmallSpec) line
>touched or crossed over the RED or YELLOW plot, there were small
>market retracements. The little guys were either taking profits or
>being consumed by the market.
>
>3.) We have had two retracements to the RED plot, with the second
>being deeper than the first. This would lead me to believe that the
>next time we get several bars whose ENTIRE range is under the RED
>PLOT , we could be seeing a market reversal.
>
>4.) Today was a nice reversal as the FEAREnv denied higher prices.
>
>5.) Is today's close below the RED plot the start of a BEAR run?
>I don't think so. Look for the large concerns to keep the market
>"pinned" near the FEAREnv until the July options expire. (7/18)
>Start watching HARD from 7/16 on.
>
>6.) Look for the following set-ups in the days to come:
>
>Prices trade to or slightly penetrate the FEAREnv and:
>
>a. ) The YELLOW plot moves below prices and the FEAREnv, while the
>RED and CYAN plots rise slightly and start to "flat-line".
>
>b. ) The YELLOW plot remains high and the RED and CYAN plots
>converge on it, and all three begin to flatline.
>
>Under these scenarios, aggressive traders can SELL the FEAREnv,
>and others can start selling when we get a close BELOW the YELLOW
>plot. Once again, anytime we get several full bars under the RED
>plot, I will be very tempted to SELL anything that gets near the
>RED plot again.
>
>To conclude our analysis of the current SPX situation, let's look
>at some historical/seasonal considerations:
>
>Statistically , the end of JULY has usually been very strong.
>This lends itself to another bio-neural concept I call "COUNTER-
>TRADING". The concept is simple: Find a system that has a lot of
>people trading it, take a look at how the market is taking them
>out, and trade THAT.
>
>The SPX situation looks very juicy to me, because near the end of
>this month, you are going to have a TON of people piling in to the
>market on seasonal (sure thing) trades. If you profile the average
>seasonal trader you will find that, sadly, they are often first or
>second time traders, that are betting the ranch. It will be the
>"pros" vs. the beginners. When pressed, these traders will tend
>to hold too long, and panic quickly once they reach their maximum
>fear thresholds. The market action that will indicate the beginning
>of this phenomena, will probably start around 7/22. Look for a
>small dip followed by sharp buying, and then a SHARP decrease, as
>the pro's start to pressure the positions. When the market has
>moved down from the buying peak the equivalent of the margin it
>takes to hold 1 SP contract, look for further sharp selling, as
>the seasonals fold up.
>
>Well, Good trading!
>
>walt :)
>
>
> ---------------------------------------------------------------
>>
>> Name: FEAR SPX.gif
>> Part 1.2 Type: GIF Image (image/gif)
>> Encoding: base64
>>
>> ---------------------------------------------------------------
>
>
>JW
>abprosys@xxxxxxx
>
>----------
>> From: Joseph M McGough <j.maczz@xxxxxxxxxxxxxxxx>
>> To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
>> Subject: MKT Tug of War
>> Date: Monday, July 28, 1997 10:12 PM
>>
>> I thought that Norman was talking about gold, not the market. Which was
>> it Norman.
>
>
Attachment Converted: "c:\eudora\attach\FEAR 7-28.gif"
|