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Ralph,
I would certainly not disagree that the tone of the market has changed over
the last week (relief or washed out for the moment), but that may be just
the rally doing its work.
As I have posted, the charts for the S&P cash indicate that is a rally in a
bear market. Normally it's goal would be to make the shorts so extremely
uncomfortable they have to cover, by pushing it beyond where it should go
(certainly to 50% on the 60min if not higher). And in the process of doing
that, it sucks in the long sideline cash that cannot afford to miss a move
up. The goal as usual is to fool the maximum amount of people.
Then it would seem to me that some type of test of the lows would create
chart patterns that "could go either way". As such the the real heated
battle of the bulls and bears, has yet to begin? October is the perfect
time for such a battle. Higher lows off of a momentum bottom on "individual
days" have had significant rallies. I would submit such a test on a longer
term chart is in the offering.
This would set up the potential for several things on the charts. A wave 2
for an eventual up move, with the prior 1-2-3's turning into big A-B-C's, as
a new up trend developes. Or a test that fails and completion of the
patterns that are currently in place.
In my opinion that test, should it occur, will "bear" watching? Admittedly
the fundamentals look pretty bad right now with the weakened economy, but
the jury is still out until that battle is over? It will be the difference
between "I think I can see over the valley" and "just get me out at any
price".
The other unknown may be the outcome may be news driven and the "news" makes
the charts or remakes them, maybe is a better word?
Sitting on the fence here, watching the troops line up.
don ewers
----- Original Message -----
From: "Ralph Volpe" <rjv@xxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Saturday, September 29, 2001 11:23 AM
Subject: Re: [RT] INDU
> Dorothy, I posted the INDU message yesterday and had to run. However,
> I'm back and after some thought, I have to refute what you've said.
> First, you talk about symmetry in the markets. Where? Look at any chart,
> I never see symmetry. For example, look at the move from 1995 to 2000,
> where was the symmetry for that? How can symmetry have alerted you to
> that move. That was strictly fundamentals, fundamentals, and
> fundamentals. Look at any chart and I can show you more violations of
> symmetry than you can show me examples of it. You also mention that
> large volume needs to define a turning point. That isn't always true.
> The common turning point develops when Bear thrusts lower are weakening
> and Bull thrusts higher are just beginning. The full thrust of the Bulls
> usually occurs somewhere near 75% of the top, or near the end point of
> the Elliot 3rd wave. That's when there's maximum unison and energy to
> run it higher. At this point, however, I think the balance has just
> tipped in favor of the Bulls and I think you'll be seening more evidence
> of that as the days unfold. Now that I've made my case for the Bull
> clear, they'll be a 1,000 point drop on Monday. If you also read back on
> this note, you see that I've used the term Bear once and Bull four
> times. See, the Bulls are winning already!
>
> Ralph
>
> "Dorothy K. Carter" wrote:
>
> > If you are right short term that it can extend the move into next
> > week... Looking at symmetry it would appear that the upside would be
> > limited and that what ever high level chop we may mark out would
> > possibly be making a right shoulder for an eventual down......
> > Personally, If we continue to rally on lite volume I can't get
> > excited for the bullish case....
>
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