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I, (like I'm sure many people have been this weekend) have been watching
this thread with interest.
This just reinforces what most all people are feeling more and more
lately... ITS NOT 'IF' BUT 'WHEN'. The problem is figuring out 'WHEN'
is.
I really appreciate the story about the novice trader, posted earlier
today, where the veteran trader asked him... 'if you are willing to sell
at 13, why not sell now at 15?'
God I hope I'm long Gold on that day.
To the survivors,
Ryan
>
> Hi, Peter.
>
> Thanks very much for the response. :)
>
> PJLaird@xxxxxxx wrote:
> >
> > <<As you can see, the DJIA April-July 1997 run-up (29.15% in 76
> trading days,
> > or .38%/td) has exceeded that of 1987 (22.86% in 67 td, or 0.34%/td)
> in both
> > rate and extent. It has almost matched 1929 (29.93% in 68 td, or
> 0.44%/td).>>
> >
> > Interesting post Jim. Certainly gets one thinking about the bigger
> picture.
> > A respectful comment or two. I wonder if you couldn't have said
> about the
> > same thing on or about 11/26/96. At that time the Dow had run up to
> about
>
> Yes. In fact, I did a similar study earlier this year on the runup
> from
> July 24, 1996 to Nov 11, 1996. That time, the DJIA was up 22.47% in
> 88td
> (but at a rate of only 0.26%/td), and went on to gain 32.52% by Mar
> 11,
> 1997, in 160td (0.20%/td) before declining in March-April. As you can
> see, the *rate* was slower then than now and in the earlier runups I
> cited. I was fooled, then, too. <g>
>
> > 6600 from the low on 7/16/96 of about 5200. Over that period July
> to
> > November 1996 the Dow rose 27% in 94 trading days 133 calendar days,
> and at a
> > rate of .34%/td (same as 1987). The similarities to 1987 continued
> with a
> > drop and then a retest of the previous high. As we all know we kept
> on going
> > up. The initial setup was "similar" to 1987, but the outcome was
> entirely
> > different.
> >
> > I notice you use a linear or arithmetic scale as opposed to a log
> scale. My
> > experience has been that a log scale is a far better graphical
> representation
>
> I understand. However, I did scale the charts proportionately,
> dividing
> the 1929 values by 1997 values, etc.
>
> > of how markets unfold. If you use a chart to look at the market
> going back to
> > 1900 or 1960 on an arithmetic scale, you are basically saying there
> was no
> > inflation (one factor) from that period to today. It means 100 Dow
> points in
> > 1960 carries the same weight, and implies the same ramifications as
> 100
> > points today. I'm not sure that's reasonable. What did the Dow
> drop in
> > 1929? The same numerical drop today would hardly cause the same
> fuss. The
> > arithmetic chart may be interesting to look at, to see from where
> we've come,
> > but I think misleading for analysis. My Dow data only goes back to
> 1970, but
> > on a log scale 100 points in 1970 is equal to 1000 points today.
> Your 50%
> > retracement levels end up being about 38% on a log scale.
> >
> > One last comment. Although I only have computer data back to 1970,
> on a
> > review of graphs going back to the early 1800s on a log scale, there
> seems
> > one obvious relationship between all the "major" correction. As
> time passes
> > each subsequent major correction is smaller than the previous one.
> I don't
> > see this mentioned ever, but there is a definite trend there.
> Doesn't mean
> > it can't change, but if it did, it would be counter to historical
> events
> > since the correction of the 1830s. The drop in 1929 appears less
> than 1835.
> > Nothing has come close to 1929 since on a log scale. 1974 was
> definitely
> > less than 1929. 1987 was about 25% less than 1974. I don't know if
> you would
> > consider 1990 or 1994 as "major", but they also reduced in size as a
> percent
> > on a log scale.
>
> I think the size of the corrections depends on what degree wave
> they're
> in. I've been "dabbling" in Elliott Wave, and I'm still very much a
> novice. This morning, it dawned on me that perhaps 1987 and 1990
> corrected 50% of their respective moves from 1982 and 1987 because
> they
> were Wave 2s, with 1987 being of larger degree. I then began to play
> with Fib extensions and retracements. (I emphasize that this is still
> in
> the *draft* stage (I got tired)). This analysis suggests that we may
> be
> completing a W3 within a "big" Wave (3) from 1982, with a 25% W4
> retracement to ~6800 or a 50% W4 retracement to last July's levels
> (~5300). After W4 completes, we would move up to about 10,000 to
> complete "big" Wave (3). Again, I emphasize that I am very much a
> novice
> at this; however, I welcome your comments.
>
> > Enjoyed your post. It also made me figure out what MIME files are
> <G>.
>
> I don't know what they are, either. I use Netscape Mail and simply
> attached a gif file to the message. :)
>
> Thanks again.
>
> Jim Harmon
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