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Timothy,
I highly agree that "they" do this at critical points that forces "other
things to happen" on the charts but not at bottoms. Take a look at the
attached gif.s for the NY Composite and then the DOW, before and after the
rate cuts. The YXC was at a 50% of a wave 2 to wave 3 retracement and the
Dow at a .618. The first chart on both is the count on 4-17-01 and the one
following, is 4-18-01. Note the difference in the count. Both were in a
1-2-3 down and the rally was a wave 4. Note the low PTI's (20's well below
the required 34) indicating that if we tested the lows we would double
bottom or it would be a failed 5th (meaning no wave 5 and the whole thing
relabels to an ABC). Then look at the charts for the 18th, yep big ABC's so
just a correction right . . . hmmm. Now I am not saying they follow EW but I
have to believe they do look at charts and know these "pressure" points.
I also remember back in 1998 when there was a huge H&S pattern in the fall
that had been broken to the downside and we had just rallied back up to the
neckline, which is normal, then it should have been "bombs away", but nope,
you guessed it a rate cut that sent it up through the neckline by a large
margin, negating the pattern.
I was not so lucky on that one :-( but having learned my lesson (I hope) I
noted these two charts on the 17th, as the INTC news hit and I bought fairly
heavily in the aftermarket session, on a hunch, that if they are ever going
to do "it" it just might be in here. I also noticed, to what my untrained
eye, was a number of C&H patterns on the daily charts for the Nasdaq as well
as CSCO, SUNW and a few others. Lucky, maybe but thanks to all the C&H
posters on the list since it helped me "put it together" for a great one-day
event trade!
don ewers
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