AUGUST COMMENTS
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Comment numbers for 20060802 273
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)
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1. We always want to be aware of those projected turning points on page 376 of "The 2006 $upertrader's Almanac - 2nd Half Edition".
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CURRENT COMMENTS
In a democracy, dissent is an act of faith. UPDATED 20060802
COMMENT #273
CHART #s 540 - 543
1. A couple of weeks ago, we discussed how one of the recent tendencies that had evolved involved the wide-ranging days identified in this CHART and the volume accompaniment seen by the vertical red and green lines.
2. Today's CHART #540 is another update and shows, by the black text and arrow, how a similar event has just, again, occurred.
3. Although the market has changed, the effect of the event may be seen to be similar to that of the discussion a couple of weeks ago.
4. The event has negated the setup seen here:
5. We can see in today's CHART that neither of the two thick horizontal pink trendlines have been breached.
6. The assumption thus remains that the market appears to be in the process of setting and important Wave 2 low as marked in the CHART by the blue number at yesterday's low and as seen by the blue a-b-c correction from last month's high (see pages 283-92 of "The $upertrader's Reference Manual").
7. We can see how the blue and red weekly Linear Time Cycle Index projected high and blue weekly Inversion Cycle Index projected turn are coming into play (WLC and WIC).
8. Most all of the remaining information in the CHART and which has previously been reviewed has not changed.
9. In CHART #541, we see an update of hourly prices.
10. Here we see such momentum oscillators as RSI and Slow Stochastics forming important price / momentum oscillator divergences at the low shown (see pages 171-84 of "The $upertrader's Reference Manual").
11. The thick blue descending trendline is drawn parallel to the descending pitchfork and allows for the interruption caused by the fundamental news event hereinabove discussed.
12. A break of this blue descending down trendline is thus expected to be seen as reasserting a break of the rate of descent of the blue down pitchfork and to adjust for the fundamental news.
13. We can see that the blue Wave c of 2 decline versus the entirety of the decline from the blue Wave 1 high is marked in the CHART in the lower right corner and measures 1.283 (SQ RT PHI=1.272).
14. Further, the green arrows show that the blue Wave c / Wave a measures 1.200 (SQ RT PHI=1.272).
15. As can be seen, price has moved down to the lower green channel trendline.
16. The suggestion thus remains that the hourly CHART is supporting the outlook of the daily CHART so long as the low shown in the CHART holds.
17. CHART #542 updates daily prices for the continuous spot futures contract.
18. We can see how price made a new high yesterday.
19. The CHART shows that price has moved from the boxes in the upper left corner to that at the bottom of the CHART to those in the upper right corner.
20. The market has moved a bit beyond the ideal which remains as presented a few days ago (see the red lines above price).
21. Price has moved up to the upper red trendline and to the blue center line of the ascending blue pitchfork.
22. The short red line in the bottom chart shows that such momentum oscillators as RSI and Slow Stochastics are failing to confirm the new intraday high yesterday, thereby forming important price / momentum oscillator divergences (see pages 171-84 of "The $upertrader's Reference Manual").
23. CHART #543 also updates the continuous spot futures contract.
24. We can see that the advance from the green and blue boxes at the bottom of the CHART to the blue box in the upper right corner has occurred over 34 calendar days versus the 43 in the decline to the low of the CHART (FIBONACCI #=34 & 2 X FIBONACCI #21=42).
25. This places the decline / advance in ratio of 1.265 (SQ RT PHI = 1.272).
26. The Elliott Wave "guess" has been reassessed and is shown as the blue A-B-C movement of 22-4-8=34 calendar days shown.
27. This movement has carried to the red horizontal dotted line shown in the CHART at the .786 price retracement level.
28. The black numbers show that the decline / advance has, so far, lasted 53 trading days making today the 54th (FIBONACCI #=55).
29. It is possible that the movement is an a-b-c-x-a-b-c advance of 8-10-16=34 calendar days which would result in a very pleasing Wc / Wa = 16 / 8 = 2.000.
30. If the true movement is as presented, we can see how price has attained both the upper green channel trendline and the upper blue ascending pitchfork at a time when the .786 price retracement level has been approached.
31. The assumption thus remains that this market, and others in the complex, are forming important tops / bottoms as shown in the CHART and as recently discussed.
32. The points at which this assumption will be negated remain quite close meaning that risk is very small relative to the potential reward should the expectation become reality.
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.
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--J. William Fulbright
