Tuesday, October 20, 2009

Closing In On The Target

I believe that the Qs (and the rest of the broader markets) may be in the very last subdivisions of the rally (wave W circled of the rally). It appears that the Qs completed wave a' of c of 5 of (C) this morning on the open. Since that time we have a 3 wave pullback which is probably wave b' of c. A measured move target for c' of c is 43.92 with a target range of 43.69 to 44.53. There is some chance that this morning's high was the end of wave c but another high would be a better fit. Coming under 42.48 would be a strong warning that the rally is over. Of course wave b' could extend or form a triangle, etc, but we should see the final high by Friday.


dave said...

TRIN 1.64 Fri 16th; 1.22 Mon; Tues 1.78 & yet we're still pretty close to the highs

Lot's of selling pressure without going anywhere.

82% bears; 6% bulls Equity Guardian Group

Short is the crowded trade

dave said...

I bought IWM putZ @ 15:32 PM, but i ain’t celebrating yet. We’ll have to take out the Oct lows as a minimum or we cubs will be running for our lives.

Nekid runnin’ bear

R. Craig Pritchard said...

See my post today. We were thinking along the same lines. I know that there are alot of shorts out there, but at this point the bulls have run out of steam and the shorts can press it even if trader sentiment is negative.

The thing that will allow the correction to unfold is investor sentiment has become fairly bullish and the late comers are likely to panic as the correction takes shape.

Think of all the poor saps that bought AAPL at 208. If they can hang on they will probably be rewarded in a few months, but if AAPL falls below 200, how many will have the courage?

dave said...

It's an Anniversary date but will it be a Gann Anniversary date (of relative degree) ?

The stk mkt crash of 1929 spanned a 4-day period that is historically referred to as Black Thursday, Black Fri, Black Mon & Black Tues. Facts point toward the crash beginning on Thurs, Oct 24, 1929 after a long period of wealth & prosperity during which many economists postulated that the mkt had reached a permanent plateau & would be able to sustain the trend in high stk prices. Black Tues, 1929, by definition, is considered the beginning of a tumultuous time period in the stk mkt’s history that resulted in the Great Depression.

dave said...

You bought QID around 2:30pm; i bought IWM puts @ 2:32; Chris Carolan:

Imminent Signal
Oct 21, 2009 at 2:42pm The eMini is on the verge of a signal.

I should have been 2:29 PM but screwed up the order input.

We all must have been reacting to the same thing.

It is imperative that we take out the Oct low though or seasonal strength will reassert itself with vengence after the O/B was relieved.

R. Craig Pritchard said...

I don't see much in the way of a significant Gann turning point beyond the short term. I don't use Gann dates beyond 12 months.