S&P 500 intermediate term top 1532.43

Breakout or "The handle"

  • Breakout

    Votes: 6 54.5%

  • "The Handle"

    Votes: 5 45.5%
  • Total voters
    11
"Where was all this "textbook" nonsense 3 days and 400 DOW points ago?

Everything in TA looks "textbook" after it happens."


See page 2 of this thread. Do you know how to count EW?
Look at the chart. EW 5 + 3 has repeated over and over. Maybe you just don't understand how to use TA. Let me guess...you just trade by feel. How do you know when to buy or sell? I bet you use at least one indicator. Do you ever look at a chart? Well, guess what......charts are all in hindsight. Good luck to you though.
 
Quote from rphuga89:

[B
See page 2 of this thread. Do you know how to count EW?
Look at the chart. EW 5 + 3 has repeated over and over. Maybe you just don't understand how to use TA. Let me guess...you just trade by feel. How do you know when to buy or sell? I bet you use at least one indicator. Do you ever look at a chart? Well, guess what......charts are all in hindsight. Good luck to you though. [/B]
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I did look at page 2 of this thread. Your EW analysis said "it is evident that higher is where we are higher (headed)"..."Each prior wave , however, did NOT meet the 1.618 rule before the correction (ABC)....so it will most likely be a bit short this time as well...... say 1600."



Quote from rphuga89:

If EW and Fibonacci can be counted on then I say we will go higher yet. On the MAcro scale the ABC correction has come at regular intervals....this interval regularity has seemed to come a little later each time lately ( since Oct 2005 ).

On a micro scale we have wave 3 EW and are about to complete wave 4 retrace.....which still leaves wave 5.


Mathmatically :

1461.57 - 1363.98 = 97.59
97.59 x 1.618 = 157.9
157.09 + 1461.57 = 1619.47 ( our target )

We have already seen 1532

Each prior wave , however, did NOT meet the 1.618 rule before the correction (ABC)....so it will most likely be a bit short this time as well...... say 1600.

Since the price line is well OFF the 40 week MA it is evident that higher is where we are higher. Would expect the ABC correction to be to just higher than the previous wave peak (1461)... I'll say 1475. We shall see!

rphuga89
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Sorry if you thought I was singling you out in ripping TA. It wasn't meant for you, but rather for TA as a whole.

In my trading I do use charts, but I NEVER buy or sell just on TA. I am purely a discretionary trader (or as you said...I "trade on feel").

Good luck to you as well. :)
 
Sorry if you thought I was singling you out in ripping TA. It wasn't meant for you, but rather for TA as a whole.

In my trading I do use charts, but I NEVER buy or sell just on TA. I am purely a discretionary trader (or as you said...I "trade on feel").

Good luck to you as well. :) [/B][/QUOTE]



No harm done. 1600 was a Fibonacci calculation. I felt sure we would be close.....but, things happen in the MARKET like this week that can not be timed or figured in weeks ahead of time. TA has merit in seeing the bigger picture. The exact stop/start points are blurred at times. But, I find it better to set goals than to trust my instincts. My instincts always lead me to the greedy side......I always let myself down. If I can lock on to a cycle or pattern I have a much better chance of anticipating the "normal" trading ups and downs.

:) later
 
Quote from michaelscott:

There is another chart that I am not showing you and I call it "the black line" chart. If you know about the existence of the 2 thick black lines, then the last 20 years makes perfect sense.

The chances are the market will not violate the lower black line and if it does it could either be a bear trap or the end to the bull market. There were many crazy events in history where the reasons for lower black line violation were there, but it only happened once and that was a bear trap.

Twice in the history of the black line has the upper line been violated and those times were 1987 and 1996. One time was a bull trap and the other time was an incredible breakout which resulted in a run of 300% in 4 years.

There are many possibilities, but knowing that the black line exists limits the different end results.

What we do know about 1987 was that there was some economic trouble that revolved around that particular time such as issues of recession....

http://en.wikipedia.org/wiki/Late_1980s_recession

The 1996 violation occurred because of a sudden pickup in the economy and productivity. The pullback back to the black lines was caused by a slowing of that same growth.

Therefore, I believe the following end-results will be likely with the SPY. A pullback to the 1400 level followed by an advance over the top black line leading to the 2200 level within 4 years.

The advance over the black line needs to be monitored carefully as the same conditions that exist in 1987 do exist today. We know that an advance might either lead to a grand bull trap or a breakout.

The catalyst event that caused the 1987 crash was computerized stop-loss orders and I will illustrate this fact in a following post on this thread.
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blah blah blah
 
Like I said, any violation under 1403 will result in drastic consequences as it will break the spine of the uptrend.

http://www.elitetrader.com/vb/attachment.php?s=&postid=1481749

Anyone who has stared at a chart for any period of time will know what usually happens next on the above chart which are:

1. A close over 1553.11 with volume will result in a breakout with the target being 2200.

OR

2. The price double tops and then pulls back. The nature of the pullback being to a fraction of the previous rise (1/3, 1/2 or 2/3) or a full retracement creating a double bottom. Then the price will then advance back to the top line and make a decision.

This chart of the S&P500 was during a time when the bond yields were on the way down. It does not show the previous 16 years when bond yields were going up. During that time, the index experienced chop and sideways action that appeared to be a giant base.

So if interest rates are the main driver of the S&P500, I see option #1 very likely if there are swift rate cuts.

Option#2 becomes likely if interest rates continue to rise or are kept at the same level.

These surprise rate hikes from foreign countries are the troubling factor. Inflation, as pointed out earlier, is also very troubling.

In looking at the ten year yield, I do see rates as high as 6% in our future with a possibility of 9% in the coming years barring any action from the fed.

Therefore the key to the markets is the 1400 level.
 
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