I
believe freely traded markets are like chaotic systems and , just like the
weather, they are not predictable with a high degree of accuracy, more than 3
or 4 days in the future.
Obviously
there are economic cycles with generally fixed periods that influence market
direction however the relevant periods are best measured in weeks or months
with error distributions that make them poor trade decision tools, at least
from my perspective.
When
I offer an opinion on this forum it is based on tools with reliability ratings
based on hundreds if not thousands of cases over extended periods of time.
Forecasts based on small sample sets are , in my mind, just guesses and not
advised for trading decisions. Calculations showing correlation of events are
meaningless unless backed up by a statically significant sample size. Fibonacci
calculations, for example, have been shown to be unreliable when
considering large sample sets.
Also,
there should be a stated methodology behind the calculations that explains why
they are relevant.
All
that being said, I offer the following about the coming week.
After
three days of trend change warnings and a Near Impulse Date of 10/14 for all,
the stock indexes reversed on Friday although only the NASDAQ and Russell
closed below Thursday lows, confirming the reversal. Generally we can expect a
three - four day persistence in trend following the reversal. For Monday
I generated 36 sell signals for the NAZ 100 and only 6 buy signals supporting
expectations of a lower low.My next Near Impulse date shared by all
indexes is 10/27 so we may expect a downward continuation until then. We shall
see.
Jim
White
Pivot Research & Trading Co.
PivotTrader.com