:: actio-et-reactio ::
amg's market charts and blather
I remarked on my Meanders page that after the early morning gap-down on India-Pakistan news that the Patriot Rally in observance of the completion of WTC recovery efforts managed to close that gap and then some.
As I write, over half of those gains are gone and the second half purse-picking rapidly in work.
The last joke is always on us-- the market doesn't often let us win for long!
Then there is the story of the islands... The question left hanging about the measured gap move is, "When should the rally be shorted?" Well, clearly that depends on your trading time frame, blah blah blah. But! There are MLs to signal the ends/beginnings, which are now in play across all the charts.
But this post is about islands. We have two recent islands: March and April.
Gadzooks, what a move! As much as I anticipated a move off the 1126-1166 area (9/11 gap plus AB=CB from 1734), not in my dreams did I think "they" would spike it 60 points on the open, and 85 points at the peak!
However.... Not to spoil the NDX party, but "I shoudda seen it"... You can be assured I went scouring the charts for what might have tipped off that move. I believe I found a clue: the 4/22 1365:1385 gap was not to be so easily forgotten.
Measuring from 1573, 1365 is 50% (188 points) to 1157. Yesterdays close was 1159. "The Gap Queen" shouldda seen it!! One way to reinforce what to do "next time" is to do a "Lessons Learned". There is always something new to learn.
To complete the gap story, today's peak ~1266 is just over the 50% rebound of the move off that gap (which I've drawn on the 60m chart).
So, IMO, today's rally is more unfinished business rather than the start of something new.
I just realized that people who don't have a stockcharts.com subscription may not be seeing the 5m charts properly. This is something I can't test as I have a stockcharts.com cookie that will always show me subscriber features. At any rate, for now, I'll be uploading the 5m chart somewhat periodically during the day, and of course, at the end of the day.
To see the latest 5 minute chart, right-click on the first thumbnail above and open in a separate window.
The 5m chart at stockcharts.com is more than "live price", it is dynamic in that I am, for now, sharing my far-more-active trading version. The chart below is the end of day version from Tuesday. It changes dramatically through the day as I add-subtract-change MLs as they play out or are needed by the price action.
On interesting pattern today was the completion of what I called an "expando-matic", a broadening formation. What I liked was that the set of MLs defined it, price on the tops favoring the bullish ML and on the troughs favoring the bearish ML. The bear won and later, another feature of the expando, the trough trendline extension, acted as resistance. Very "nice" (gg).
That 1228 level was once again challenged and ultimately breached on the close. This is likely to open the door to the next round of lower levels, 1219-1212, a touch of 1192-1203 then pretty much a clean shot to 1166.
Mind you, this is the big road map and largely based on a failure of the Daily Median line to prop price. Note that today price closed below that line. This was a confirmation of Monday's first test which closed below that line. My take is that this confirms a stronger bias down. But as always, I don't make the waves, Lady Market does.
Someone asked me "how" I used MLs to trade. It isn't quite as easy as 1-2-3, but there are times where you get a bunch of signals that produce very satisfying trade results. I updated the chart I post earlier with annotations that show my thinking as the day and trade progressed. Hopefully it will be of interest or help to some of you. [right click & open in separate window]
Actio - reactio, give and take, see and saw, that's what this is about. On the backside of nice is quite dreadful.
Makes you want to really believe in that moon stuff (lol)... scroll down and see that the lowest lows of the full moon cycle decline generally falls 5 days after the full moon. Now, Friday was the Full Seed Moon, that makes today Day 5 (Note that the chart is Calendar Days not Trading Days). Statistically, there "should" be a rebound. Reminds me of that bear and bull playing pool, where the bull calls it a pre-rally decline.
[Addendum: Having said that, a "rebound" could be a dead cat. One other consideration is that this is the so-called TOM, Turn of Month, during which new incoming funds are deployed and laggards are shed. If there is such a thing this month, it may be muted.One more observation. Some time ago I mentioned that 1228 was significant in that it is the 78.6% retrace of the 252:4816 1990-2000 bull. This is teeth gritting time for the bullish and rightly so. Should that Fibonacci support crack, at least from a geometric perspective there is little support till you get to the 1166-1203 realms, and of course, the September lows of more recent memory.
|
moon phases |
At last, over the rim
of the waiting earth
the moon lifted with
slow majesty
till it swung clear of the horizon and rode off,
free of moorings
- Kenneth Grahame,
The Wind in the Willows
blather: nonsensical talk.
At times my analysis log, at times sharing what I've learned. Always my own work and views.
Content: amg
Basis: glish & bluerobot
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