Half Way There



A picture is worth a thousand words, don't you think? Well, maybe if you're a man, it might be 10 words and if you're a woman, a thousand. Sorry for the stereotype and I'm only kidding.
I decided to keep the drawing from when I created it about 2 weeks ago and decided to compare. My pivot is 1015ish area, but was can see it's been closer to 900ish. That's understandable as I personally have been more bearish on the market and happily bearish. Most of the money I've made has been on bearish positions. OF course, the money it's cost me has been me being more bearish than the market. :-(

I had to let enough days pass to show what I was talking about. As you can see from the chart, the amplitude of the wave is becoming smaller. The first wave had a low about 840, second low was 866 and now the third low is 876. I looks sort of like it's compressing into a pennant.

To me, volume says a great deal here. A video would probably do it better justice, but I'm just going to spell it out here instead as I don't really feel like doing a video, which takes longer with the upload and everything.
10/1 to 10/10 the trend of bearish volume was up as price dropped. This correlates.
10/10 you get a big surge of bearish volume and often with any surges of volume out of the norm, the next day you will get a pullback, which is exactly what happened. How do you know if it's a big surge? That volume will stand up above all other volumes near it. Remember, everything is relative.
10/14 they are testing to see if they can bring in more buyers initially, but it was just very weak and thus sellers came back in instead. However, near the end of the day, some buyers did come back. I think closing near the 200 EMA on the Monthly is significant.
10/15 attempted to see if they could get more selling action, but volumes were lower. Maybe we're a little tired of all the selling and need a break?
10/16 the bears attempted to take things down further, but bulls really came back strong and really dominated for most of the day. However, the high of this day was not enthusiasm, to attempt to get back to the 200 EMA. Volumes were not as strong either or there just wasn't the energy there.
10/17 there was optimism here for 2/3rds of the day, thinking maybe they could get back to the 200 Monthly EMA, but failed and the last 2 hrs the bears came back. The bulls just couldn't hold the bears at bay.
10/20 attempted to make a last ditch effor for now, but just didn't have the enthusiasm or gusto to really move much. People seem disinterested and not really believing things are good in the economy, as they are not. Volumes are weak.
10/21 really couldn't decide am I going to be bearish or bullish and in the end, bearish looked more attractive. If I can't move the price up, I'll drop it to see if I can do something and drop it fast. There is a general complacency.
10/22 well, if I can't get the markets to go up, I'm going to see if I can create some action by further moving the markets down.
What's interesting is if you see the lows and how it's forming, it is quite interesting the compression pattern that is developing. Pressure is building and one way or another, when it breaks out, it will move faster. So, if it trades into that point, don't be surprised. I actually see it trading into the point and sort of going sideways, with less volatility until elections.
There may be, however, a couple days that it may really do a high reach up and/or a very low reach down to see if they can bring in either buyers or sellers. I don't see these as being marabozu type days rather long wick days.
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