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Monday, September 28, 2009
Sell Bumps Early in the Week
We should near 9,100 late this week (the timing isn't as important as meeting the condition) then sharply retrace the majority of the loss since the Dow's recent 9,900+ high.
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I am with you FDR. I think this nonsense will go out the window soon. I see the herd waking up and realizing that owning a house doesn't mean having a mortgage.
ReplyDeleteCan we infer from your post that an index short position (I am thinking SPX) taken late this afternoon to coincide with the EOQ peak shenanigans has a high, albeit short-lived success probability? Wasn't Dow 9100ish some sort of major support during the tech era collapse?
ReplyDeleteFDR,
ReplyDeleteDo you find it troubling that the current minute wave ii retrace is already at 62% when the minuette wave 2 fractal from the 1080 peak only retraced approx. 30% of the minuette wave 1. Just trying to fully understand EW. Thanks.
"Do you find it troubling that the current minute wave ii retrace is already at 62% when the minuette wave 2 fractal from the 1080 peak only retraced approx. 30% of the minuette wave 1."
ReplyDeleteNo, but if we exceed the recfent high we'd have to kick the can to the right. The biggest wave is still in a perfectly normal rollover, which is why we have to be careful analyzing the little stuff.
FDR wrote: "No, but if we exceed the recfent high we'd have to kick the can to the right. The biggest wave is still in a perfectly normal rollover, which is why we have to be careful analyzing the little stuff."
ReplyDeleteOK, I'm confused.
Why would the big stuff have any greater probability of being correctly analyzed/incorrectly analyzed than the little stuff? Aren't these waves supposed to be infinitely subdividable? Shouldn't analysis of the smaller/shorter wavelets be just as valid or invalid as the analysis of the bigger/longer waves?
Throwing out the data that doesn't fit with your preconceived notions is a technique that is used all the time -- by religious true believers.
If EW analysis works in terms of yielding accurate predictions then it should work just as well for the little waves as the big ones. If it fails a lot for the smaller stuff, then why in the world would anyone rightly believe it has greater relevance for the bigger stuff, particularly since one of its central theses is that the waves subdivide recursively?