Sometimes we need a grin...........have a great week....
ES Journal Archive (2006 - 2008)
- Thread starter Buy1Sell2
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Having shared what I was looking at and thinking about on Friday, let me now whare what I was looking at and thinking about over the weekend. Let me start with the shortest timeframe and work up to the longer ones.
Heres a 60-minute chart.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582143>
Trend continues up since 8/17 (fed discount rate cut). Calculated targets 1506 andf 1531.50.
Heres a 60-minute chart.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582143>
Trend continues up since 8/17 (fed discount rate cut). Calculated targets 1506 andf 1531.50.
Now moving to the weekly chart, with longer term projections to 1609.50 and 1638.00.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582149>
Also note the earlier AB=CD projection dating from 06/16/2006 when ES was at 1280 predicting a run-up to 1580 (300 points) . The actual top turned out to be 1565.75 (286 points). Again, surprisingly close for such an oversimplified method.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582149>
Also note the earlier AB=CD projection dating from 06/16/2006 when ES was at 1280 predicting a run-up to 1580 (300 points) . The actual top turned out to be 1565.75 (286 points). Again, surprisingly close for such an oversimplified method.
Now for the scary stuff...
Mvoing to the monthly chart, I find this a real eye-opener.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582151>
Look at the RSI in overbought territory. Also note the last time it was in this territory: early 1999. This was followed by a lovely RSI grail and MACD histogram divergence which foretold the bear market of 2000-2002 during which ES lost a~800 points.
If ES gets up to my projected target of 1638 (previous chart) and that turns out to be the top, my dumbass AB=CD method predicts a bear market bottom of 716, which would represent a loss of 50% of the value of the S&P. Now that's scary! Fortunes would be made by the shorts, but will there still be anywhere to spend it after that sort of crash?
Let's be clear that this isn't due to happen any time in the next few days, weeks, or months. We don't yet have an RSI grail or MACD divergence, and the shorter-term trends are clearly still up. But if and when it happens, your investment funds better be in cash (or shorts or puts).
Mvoing to the monthly chart, I find this a real eye-opener.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582151>
Look at the RSI in overbought territory. Also note the last time it was in this territory: early 1999. This was followed by a lovely RSI grail and MACD histogram divergence which foretold the bear market of 2000-2002 during which ES lost a~800 points.
If ES gets up to my projected target of 1638 (previous chart) and that turns out to be the top, my dumbass AB=CD method predicts a bear market bottom of 716, which would represent a loss of 50% of the value of the S&P. Now that's scary! Fortunes would be made by the shorts, but will there still be anywhere to spend it after that sort of crash?
Let's be clear that this isn't due to happen any time in the next few days, weeks, or months. We don't yet have an RSI grail or MACD divergence, and the shorter-term trends are clearly still up. But if and when it happens, your investment funds better be in cash (or shorts or puts).
thanx for the wonderful charts, and analysis.
Now, the monthly ES chart has time-adjusted prices, which makes them perhaps a little suspect. So let's look at the S&P cash using the same methodology.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582164>
The spooz clearly shows a 2007 peak that is exactly the same as the peak just prior to the 2000 bear market, almost to the point.
As out friend Spectre might say, there are two possibilities: the spooz could continue up, or it could go down. (Well, duh!)
If it goes up, my AB=CD projection would be for 2109! (That's the ES, not the NQ!) If it goes down, the projection is 772 (pretty close to the earlier one based on ES).
So which will it be, up or down?
Look at the RSI in overbought territory. Guess when that happened last?
Also, unlike the ES, the spooz is showing very obvious MACD histogram divergence.
So my bet would be down. And that won't be a pretty picture.
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=1582164>
The spooz clearly shows a 2007 peak that is exactly the same as the peak just prior to the 2000 bear market, almost to the point.
As out friend Spectre might say, there are two possibilities: the spooz could continue up, or it could go down. (Well, duh!)
If it goes up, my AB=CD projection would be for 2109! (That's the ES, not the NQ!) If it goes down, the projection is 772 (pretty close to the earlier one based on ES).
So which will it be, up or down?
Look at the RSI in overbought territory. Guess when that happened last?
Also, unlike the ES, the spooz is showing very obvious MACD histogram divergence.
So my bet would be down. And that won't be a pretty picture.
fwiw....i`m out of my shorts (83.75) as of tonight for several reasons.....mainly decided to clear the mechanism & get flat before my morning flight.although i expect a reaction to downside off daily dow TL.....we`re in walk up mode to fomc on 9/18.
good trading to all this week.
good trading to all this week.
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