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Public blog posts only as education and entertainment. private membership market updates reflect my view and analysis of the market. The information contained on this website and from any communication related to the author’s blog and charts is for information purposes only. The chart analysis and the market comments do not hold out as providing any financial, legal, investment, or other advice. In addition, no suggestion or advice is offered regarding the nature, profitability, suitability, sustainability of any particular trading practice or investment strategy. The materials on this website do not constitute offer or advice and you should not rely on the information here to make or refrain from making any decision or take or refrain from taking any action. It is up to the visitors to make their own decisions, or to consult with a registered professional financial advisor. And i absolutely discourage trading options.

Wednesday, October 20, 2010

flexibility - low risk sell here with slightly up ah, imho

not a good news, but it's a fact that most people vote on the blog sentiment last 7 days becomes contrarian indicator.
it's two week in a row, sentiment is too bearish and become contrarian.





the final wave up should be a "failure" or called truncation, according to the textbook. but no criteria is stated.
ndx already fulfilled the goal w/o a "failure", so could be mission completed.
a quick review ah, saw today's high got rejected at the back test line, a sign of completion.
also the volume cycle could have already topped a few sessions ago at its iso line.

should not up two big day in a row considering the final
stage of rally. even if it would go up, would just crawl along the iso line (not violated yet). the stop above is not much risk.
if 1185 was a "done", then all be good.
or if it's bigger 4th, then i have one more c of 4th down. plenty room to react. tick is overbot.

this market is like a drunk pomo :), down big yesterday, up big today. traders need to be nimble and flexible weight in evidences.
i don't drink, but i can be flexible to adapt too. :)

conclusion: low risk sell here as quick review so far. at least ST bearish, could potentially turn into "permanently" bearish.
further review going.

PS. 1). hi, grand, it's been a while. even though mostly we have opposite view, but you are one of the extremely few blog writer i respect. i recommend reading your blog to get a different view. hope you stop by and comment more often. we can have healthy debate if with different views. for example, the 60m chart you posted:
you have red [iv] at 38.2% at 1130, which is typical. But then red [i]-[iii] line and [ii]-[iv] line become a wedge, not a parallel channel(i think you like channel?). also the velocity(slope) of [iii] is not steep enough, especially 2nd half of the rally. since 9/30, it only rallied 28 points in 15 trading days, not good enough for a wave [iii]. also wave [iii] usually doesn't end with a bearish wedge, that usually a traits of wave [i] leading diagonal or wave [v] ending diagonal. what do you say? this is a healthy discussion or debate on elliott wave.

2). i have noticed that many strongest emerging markets are starting to turn down at iso resistance or expanding target line. a sign of the whole world turning.

3). grand, you said "seasonality in nov favoring the bulls". how about year 2008? was the presidential election. spx down from 1007 to 741 within 13 trading days. that's 266 points crash from Nov 4 to Nov 21. here we have similar schedule for the fomc & election. will history repeat? i think very likely and could even worse. i guess either fed doesn't announce enough or sell the news. but i see that as 2nd wave of plunging, and first wave of plunging coming shortly. what can't you find? i don't understand.
Also for year 2007. spx down about 150 points from Nov 1 to 27.
for 2009 Nov is good for bulls, but that's after the plunge from 10/21/2009 to 11/2/2009 for about 70 spx points. here we have a run up, next should be a run down, just a question of how strong the run down of the red cycle. everything has a cycle. this up cycle already lasted nearly 2 months, should be enough, nothing runs forever. to be fair, let's see how strong is the coming down cycle.