Bond Market Highlight #11
Numerous projections listed in "The 1998 $upertrader's
Almanac - 2nd Half Edition" and "The 1998-99 $upertrader's Book of Linear Time
Cycles" and explained in "The $upertrader's Reference Manual" mark the
EXACT DAY of retest high.
(COMMENT # 752)
UPDATED 19981018
COMMENT 1998-752
1. The chart shows hourly December bond prices through Friday's close (overnight prices).
2. Note the large down move in the chart from the 981005 high.
3. This down move occurred directly after the NEWS that the Federal Reserve Board had
LOWERED interest rates.
4. Likewise, Friday's high occurred shortly after the NEWS announcement that the Federal
Reserve Board had again LOWERED interest rates.
5. The horizontal line in the chart shows the 50 percent retracement level (see pages
185-7 of "The $upertrader's Reference Manual).
6. Note that price was not able to close above this level on even an hourly basis.
7. (It is insightful that, were one to use day session prices [which would not include the
overnight low shown in the chart on 981016], price would be seen to have rallied to the
13106 50 percent retracement price level on 981016 TO THE TICK).
8. In terms of TIME, the RATIO of actual trading hours = 96/84 = 1.143 (ROOT 8 of 3 =
1.147).
9. If we add the hours of the 12th of October and assume that normal hours were followed,
then 120/84 = 1.429 (SQ RT 2 = 1.414).
10. We have already discussed how the peak ALIGNED WITH the "Astro Points"
listed on page 398 of "The 1998 $upertrader's Almanac - 2nd Half Edition" (see
COMMENT #s 728 of 981005 and 741 of 981007 to see how the peak, though difficult to
discern, ALIGNED
EXACTLY with information listed in the books).
11. We can now turn again to page 398 and see that, if the market moves lower from
Friday's high, it will again have ALIGNED EXACTLY with an "Astro Point" (A&P
Point).
12. Also, note the weighted "Anniversary Date Index" values on page 185 of
"The 1998 $upertrader's Almanac - 2nd Half Edition".
13. The up channel shown in the chart is, of course, as insightful as it is obvious.
14. The "Wave 1 down, Wave 2 correction up" "Elliott Wave"
interpretation, although just a guess, is the most probable interpretation suggested as
this is written.
15. Traders should always focus on possible "2 Wave" corrections, even when the
interpretation is not certain (when is it ever?).
16. In the chart, odds are higher than usual that this "2 Wave" is the correct
interpretation.
17. Such is suggested, if for no other reason, because of the ALIGNMENT of the 981005 and
981016 price peaks with the "Astro Points" (the "A&P Points")
listed on page 398 of "The 1998 $upertrader's Almanac - 2nd Half Edition".
18. Such an interpretation is also suggested by the ALIGNMENT of the 981005 peak with the
weekly "Inversion Cycle Index" listed on page 193 and shown graphically (by the
peak in the dotted line in the chart at the bottom of the page) on page 305 of "The
1998-99 $upertrader's Book of Linear Time Cycles".
19. Further, the "Linear Cycle Index" also ALIGNS WITH the interpretation as may
be also seen by the downward slope in the weekly "Linear Cycle Index" on page
305 of "The 1998-99 $upertrader's Book of Linear Time Cycles".
20. The monthly "Linear Cycle Index" shown on page 303 of the same book also
supports this outlook.
21. In fact, remember the last time we cited such information as that shown on page 303?
22. It was in July in the stock market prior to the subsequent 3 month price plunge which
followed (if you don't believe me, turn to page 295 in "The 1998-99 $upertrader's
Book of Linear Time Cycles").
23. If you had the book, it was there all year long, was repeatedly highlighted in these
COMMENTS, and, hopefully, you were able to avail yourself of the information.
24. Now turn back to page 303.
25. Look familiar?
26. Can you see how both indexes projected 1998 highs for each market (stocks in July and
bonds in October)?
27. Isn't this easy?
28. Isn't this fun?
29. Can you now see why it's not the "Elliott Wave" interpretation that's
important, but that it's all the other information in the books which suggests the
"Elliott Wave" interpretation shown in the chart?
30. Now the reason for all the above.
31. If the ALIGNMENTS are all correct, price should be ready to plunge some more.
32. Note that in our method of trading, we have defined a period in TIME when the RISK to
our interpretation is minimal relative to potential REWARD.
33. Doesn't matter if we're right, for we don't get paid to be right.
34. The whole concept, as has been repeatedly presented in these COMMENTS, is to identify
situations which, if we're even CLOSE to being correct, have a chance to EXPLODE
(IMPLODE)!
35. If you go through the year and focus on only the "prime time" trades, you'll
stop worrying about whether you're right or not and will learn to enter the orders, risk
minuscule amounts, and have gargantuan winners when it works.
36. The result is equity expansion of the account which, to quote Captain Kirk, is the
"prime directive".
37. It is NOT "outsmarting" the markets and "being right".
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