JULY COMMENTS
Scroll down to view each Comment one by one or click on the
individual Comment number you wish to view.
Comment numbers for 20060714 236
GENERAL COMMENTS
"It would indeed be ironic if,
in the name of national defense,
we would sanction the subversion of one of the liberties . . .
which makes the defense of the Nation worthwhile."
- United States v. Robel, 389 US 258, 264 (1967)
>> >> << <<
1. We always want to be aware of those projected turning points on page 368 of "The 2006 $upertrader's Almanac - 1st Half Edition".
5. Click here to access our new charting service!
CURRENT COMMENTS
"The man who reads nothing at all UPDATED 20060714
COMMENT #236
CHART #471
1. In the following CHART of daily prices for the continuous spot futures index, the expectation was that the market had completed the decline marked in the CHART by the 5 blue numbers from the March high to June low (see pages 283-92 of "The $upertrader's Reference Manual").
2. In this particular contract, the new low in June necessitated moving the assumed blue Wave [B] high from the blue Wave 2 high in April to the March high.
3. New price lows were not seen in other contracts in this market as may be seen in the following CHART:
4. The importance of this non-confirmation between the various contracts in the market (see pages 171-84 of "The $upertrader's Reference Manual") is that it allows the following original interpretation to continue to remain as the favored interpretation in this market:
5. Because the above is the favored interpretation for this market, it is thus, also, the favored interpretation for other markets in the complex.
6. As an example, in mid-May, we were discussing the likelihood that the rally from the spring lows had ended in this market:
7. But a few weeks later, the market, although a little bit lower, was not seen as accelerating to the downside:
8. A pause was experienced in the decline.
9. From the black Wave 4 high, the market then unfolded in the 5 wave impulsive sequence marked in today's CHART #472 of daily prices for the continuous spot futures contract.
10. This decline allows for the labeling shown by the 5 black numbers.
11. It suggests that the interpretation of mid-May was on-course and correct.
12. It is appropriate that price bottomed at the green and blue boxes shown in the above CHARTS.
13. The question relates as to the nature of what has happened since the late June low.
14. From that low, we can see that price has advanced in a 3 legged movement to the 707 high.
15. It's possible that this a-b-c advance, as labeled in the CHART, is the entirety of the upward (counter-trend) correction this market might see.
16. More likely is that the movement has formed a little bit Larger Degree of Trading A-B movement as labeled in the CHART.
17. If correct, then, from the late June low, the market has seen a 5-3=8 trading day correction (so far) to the black Wave A high and Wave B low and 8-5=13 calendar day correction (FIBONACCI #s=3, 5, 8 & 13).
18. If such is the case, the thin red up trendline should not be broken nor should the thick pink horizontal trendline prior to completing a black Wave C advance.
19. We can also see how the lows of the last two days have held the ascending pitchfork marked in the CHART by the light grey dashed lines.
20. This pitchfork is drawn off the Wave A high and Wave B low.
21. Hence, all this suggests that a break of yesterday's low not only negates the very short term assumption that the market is in the process of completing an A-B-C counter-trend correction, but that the downside decline has resumed and is set to accelerate.
22. Since the blue Wave 1 low at the bottom of the decline in late June suggests that the main trend has now turned down, and has been down since the mid-May high, we want to orient our positions in the direction of this emerging downtrend.
23. This means that we want to be more sensitive to accepting (in this example) sell short signals that are in the direction of the new trend.
24. When we examine the simple icons shown in the CHART, we can see several trigger points we can monitor that, if breached, suggest that the downtrend is, in fact, in the process of accelerating.
25. What this means in the CHART is that, if such triggers are elected without price first having broken the 707 high, the assumption is that the 707 high is the blue Wave 2 of an emerged pattern.
26. Since Wave 3 movements are supposed to be explosive with gaps/high volume and so on, we can see that the reward relative to the risk is pretty high in this example if our interpretation proves out as anticipated.
27. In the process of trading, it is helpful if we are able to become disinterested in whether or not our analysis is correct.
28. All we care about is to learn to repeat the methodology again-and-again so that we are constantly exposing out capital to large return / minuscule risk situations.
29. Learning to adapt to such process takes quite a bit of repetitiveness and discipline.
30. The reason is not because there's anything that's actually difficult about putting an order in ---
31. --- it's just that there are always so many distractions suggesting that one should not put the order in.
2. We always want to be aware of those "Inversion Cycle Indexes" in the weekly pages of the April through September edition of "The 2006 $upertrader's Book of Linear Time Cycles" which is available in an easy-to-use electronic format. A sample of the format for the charting file may be seen in the NOTICE posted here. Ordering information here!
3. The initial issue of the free "Trading on the Edge" E-Zine was released 20001021. Archived copies are available here. Subscription information here.
4. NOTICE of refund and cancellation polices may be accessed here.
is better educated
than the man who reads nothing but newspapers."
--Anon (but suspected as having
originated from Karl Rove)
