Wednesday, October 20, 2010

Wednesday Thoughts - World Class charts from readers.

Check out these world class charts from readers.
And thats about all I have to say about that.

We pretty much caught the cat sneaking out of the PRS bag on USD last week Wednesday.

Keep in mind, rather than just 61% retrace, now the market is making the ramps more extreme to 78% to make sure no one is able to achieve both
1) limited risk by placing stop right above your entry point.
2) Stay in the position

Or per the other Fractal drawing...start the downtrend, then ramp it to new recent highs blowing out all stops, then drop, then ramp. NOW -- no one wants to try to short after being beat up so badly.

The GLD/SLV ratio with moving average is saying retail exuberance, time for a slapping.


  1. now that almost everybody and their brother (and sainted aunt sadie) think we're bound for 1200+, wouldn't it be a great time to drop like a rock? especially since the longer term chart indicators seem to have quickly gone from very bullish to not-so-bullish-or-even-pretty-bearish. and especially since the biggest fundamental reason anyone has is 'the fed will prop up the market'.

    sorry, the fed doesn't have anywhere near enough money to hold up a multi-trillion dollar trading market that wants to come down. nobody does.

    should be an interesting couple of days.

  2. The money the Gov has been "injecting" has been very poorly spent, very poor return on investment, very limited long term gains in productivity. They can sure ramp the futures and the indices, and AAPL, It it drops I expect 12% in a week.

  3. Nice forecast on the dollar Steveo... If it plays out, the market is really going to tank hard.

  4. I have checked if they move one for one, but that would be a 10%+ move on the dollar. This correlation seems pretty strong though, and I will assume the correlation sticks until it doesn't

  5. I agree with you Dark.. everyone is too bullish right now. We need to go down some first, and then maybe a rally up to 1200 by the end of the year or early next year.

    But I see some selling coming next week, and we should see a move down tomorrow morning too... how far is unknown? We could start some wave 3 down or just a mild pullback?

    I've been wrong many times in the past, when listening to my gut... but the charts (and my gut) say we'll get a nice move down over the next few weeks. I think the short term top is in for now, and after a several week sell off, I'll then look for a rally back up.

  6. hey, red, it's good to run into you! I'll try to play it as it develops, and not take anything for granted...up or down.

    there's a lot of talk about that 1200 area. just early last week, I was looking at my charts and thinking the longer term ones looked very bullish, but by today, the daily looks overripe and the weekly isn't looking too hot...which is coloring my view of the monthly, which seems more vulnerable now.

    time will tell, I'll just go step by step.

  7. the higher and faster they go up....ker-splat!

  8. Yeah, I hear the BPT guys refer to those final moves up as "Exhaustion gaps", which is probably politically correct nice way of saying ---"intentional ramp jobs to run stops at known levels, using their money under management like your State pension fund".

  9. My theory is that one or more institutional players will head for the exits before the elections to beat the rush.


Insightful and Useful Comment!