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> The big surprise for me this week has been the turnabout in bonds - they
> have blown right through AGet's daily w.4 projection and caused AGet to
> reclassify this rally from corrective to impulsive suggesting that more
> upside lies ahead.
Here is an alternative perspective or a different conclusion from evaluating
the same picture!
A few moons ago when I was visiting my daughter in the USA, I found myself
riding in the desert in Arizona and seeing the enormous water spout, from
many miles away. This huge column and the water falling, as the wind blew
it in an arc to the ground. Later we went to Fountain Falls and sought it
close up. The largest in the world, I was told, while I was thinking of
the one in Geneva...
Anyway, on my return to England the bonds made and exact such pattern and so
I christened it Fountain Falls. On every occasion since then, after such a
pattern we have had lower prices. This is very much in line with the
normal expectation of an Upthrust.
The pattern is time was formed as the market retraced through the .618
retracement line from the Contract High, but - and this is the important
bit - it then came back and closed on the 'other' side of the line.
Consequently, I expect lower prices, rather than it "suggesting that more
upside lies ahead."
So, it will be interesting to see what it does do. As a day trader I
couldn't really care less what it does, because I will attempt to follow the
market wherever it goes. However, according to my analysis I shall be
looking for short trades, but quite willing to accept long ones, if the tape
says that is what it is going to do. But in the vein of the last
continuation Doji Sandwich, I might well punt a put for the hell of it...
Incidentally, the yellow lines on the chart are the overnight high and low
and it is interesting that it could not take out the .618 line. Ah well,
we'll see very shortly. Meanwhile, I hope the Fountain Falls helps someone
to make some money. A pretty picture isn't it?
Bill Eykyn
www.t-bondtrader.com
"Learn to read the tape"
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