Short/Intermediate Term Top

From my perspective, going into the past week I thought 935 on the SP would be an important level for a few reasons:

First, 935(area) give or take a few handles, was the Swing Low following the first penetration of last September's Major Swing Low around 944. The day the market turned(July 3rd) was just after the end of the Second Quarter and the market made a sharp severe break higher. On July 10th market broke lower thru that pivot and that is when the market was offered for 2 weeks straight spiralling into the "slow motion crash" as someone mentioned.

Second, as TNT Neo just mentioned, there was a technical 20 DAY(Closing Basis) breakout thru 915(area) on Wednesday of last week. Major Short Capitulation and perhaps much more natural buying or long side commitment thru that pivot. So, basically, I think we saw some natural resistance into 935 due to the laws of support/resistance and we have some clear support down at 915 where the 20D breakout longs are defending their position.

There is no question in my mind that if this does prove to be a "Turtle Soup" pattern that it will be really swift downside action because the long liquidations dont retrace. Once the longs jump on board and get liquidated you get that same corrective downside price action we saw in the bull market with very shallow up retraces.

Anyway, we will see...
 
yada yaddda doodileedoo.

tops bottoms blah blah too,

the momentum is up!!!!

shorts are blowin off steam.

trade what you see, not what you think!!!

the market is rising, and yess the bottom stinks!!

it stinks of people like you calling a top

poised for the market to make another drop.

but this time it won't and the confirmation is in

the bottom is past and the momentum begins

but oh yeah

go ahead

and continue with your

yada yadda doodileedoo.

meanwhile, me and the market take money from u.
 
Originally posted by bbraunstein
One of my trading buddies is a great EW analyst and junkie. He says we are putting in a bearish rising wedge and it is going to get really ugly.

Kind of scary, but it is a bear market.

Funny how complacent people get after only a few weeks and a small rally....
More...

I follow a few elliott wave guys. They all say SP is the 400 to 500 range with a bear market to last as late as 2006.
 
Yes, the sky is <i>definitely</i> falling for the wavers. Reading Prechter has really sobered me up.

Isn't 2006 also their target for the Dow? Oh, no, that's 600+/-, by Prechter's reckoning.

If you look into the depression, the crash of 1929 was only the baby steps beginning of the bear market.
 
wavers, like anyone trying to predict the market, are doomed.
but not all wavers are trying to predict, that's what you should realize. but I won't go into that.

it is more important to look at odds.
the market is rising. but it's a very dangerous level to join either long or short in the intermediate timeframe. However I see a slighter advantage to short.
I enjoyed the down move and I am flat now. the recent action, in this time frame, is a fool's game.

short term is still very profitable for me, but there are signs volatility is disappearing again. (either as a warning before rolling, or just because august is august and wasn't until now). Many are only calling things up and talk is cheap. wishful thinking, if actually traded, is very expensive though. Remember, there are 3 positions : long, short and cash. Be cash when you should admit you don't know (that's why I am flat, see above).

tntneo
 
So who are we to try to figure out the mindset of 50,000 + big fund managers/traders? Not to mention the millions of retail investors? (it's fun to try even though it is lame...)

My best GUESS? The market will trade in a range until Sept. when the new economic growth numbers come out. Since most economic standards experienced mild retracement this month from prior months growth levels, this is what re-ignited talk of a double bottom.

If the economic data for the next quarter recedes instead of showing additional growth, market will tank again and continue trending lower overall...

If the economic data once again shows a positive growth trend then I believe that stocks will trend up barring any other major economic news like housing bubble pop or bank failures or whatever.

It's just going to take a sustained period of no real bad news.

For me, it'll be buy support, sell resistance for a while.

Humbly,

Paul
 
I disagree with this mindset. I beleive the markets can be figured out, as human behaviour tends to repeat itself and form patterns which can be predicted.

Part 2 of the riddle.

to find the peak i define,
the hidden bottom as above
while the top as below
between the two there is nil
reverse the riddle to find the trough.

Part 1 is in "top traders don't share info" thread.
 
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