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The Line of Least Resistance is Down


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#11 Russ

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Posted 17 May 2009 - 10:52 AM

Beautiful system you've got there Don. Also look at the vix big bull flag getting ready to explode to the upside. And NYSI's chart here... Aloha! Don't forget to put the lime in the coconut! B)
http://stockcharts.com/c-sc/sc?s=$NYSI&p=D&b=5&g=0&i=p64883549915&r=2942.png
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#12 Echo

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Posted 17 May 2009 - 12:25 PM

Beautiful system you've got there Don. Also look at the vix big bull flag getting ready to explode to the upside. And NYSI's chart here... Aloha! Don't forget to put the lime in the coconut! B)
http://stockcharts.com/c-sc/sc?s=$NYSI&p=D&b=5&g=0&i=p64883549915&r=2942.png



Russ, please also note that you have just displayed a rare 3 step (5 wave) McSum pattern to the upside which over the past 80 years has been extremely bullish long term. That certainly doesn't negate the possibility for a price decline from here, but historically, a high McSum value as we have here has buffered against waterfall type price deterioration, unless a significant bearish fundamental news item is unleashed.

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#13 VolPivots

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Posted 17 May 2009 - 12:30 PM

Russ, please also note that you have just displayed a rare 3 step (5 wave) McSum pattern to the upside which over the past 80 years has been extremely bullish long term. That certainly doesn't negate the possibility for a price decline from here, but historically, a high McSum value as we have here has buffered against waterfall type price deterioration, unless a significant bearish fundamental news item is unleashed.

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Bingo!

#14 Russ

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Posted 17 May 2009 - 01:00 PM

Russ, please also note that you have just displayed a rare 3 step (5 wave) McSum pattern to the upside which over the past 80 years has been extremely bullish long term. That certainly doesn't negate the possibility for a price decline from here, but historically, a high McSum value as we have here has buffered against waterfall type price deterioration, unless a significant bearish fundamental news item is unleashed.

Echo


Ok Echo thanks for the info, however this is far from an ordinary market, I see a low coming in late June from my oscillators, I'm with IYB who is never wrong! lol
"Nulla tenaci invia est via" - Latin for "For the tenacious, no road is impossible".
"In order to master the markets, you must first master yourself" ... JP Morgan
"Most people lose money because they cannot admit they are wrong"... Martin Armstrong



http://marketvisions.blogspot.com/

#15 snorkels4

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Posted 17 May 2009 - 01:43 PM

but if it was that easy anybody could do this stuff and we know that aint true.

Easy? :o Since I'm on the subject of Livermore, I'll paraphrase him one more time: "I've known many who could be right, but those who can both be right AND sit tight are very very rare indeed". Sitting tight with a leveraged trade through a market cycle is one of those things that always, in retrospect, sounds very easy..... but in real time is excrutiatingly difficult. :o ;)

i was refering to the positive divergeces in my chart of tna being "too easy" -- doesnt work in backtesting and is too easy. your system is complex and elegantly simple=just clarifying. thanks for the response :)
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#16 IYB

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Posted 17 May 2009 - 03:55 PM

but if it was that easy anybody could do this stuff and we know that aint true.

Easy? :o Since I'm on the subject of Livermore, I'll paraphrase him one more time: "I've known many who could be right, but those who can both be right AND sit tight are very very rare indeed". Sitting tight with a leveraged trade through a market cycle is one of those things that always, in retrospect, sounds very easy..... but in real time is excrutiatingly difficult. :o ;)

i was refering to the positive divergeces in my chart of tna being "too easy" -- doesnt work in backtesting and is too easy. your system is complex and elegantly simple=just clarifying. thanks for the response :)

My apologies if I sounded snippy or defensive. I reread your comment after I posted and saw that what you were saying was not exactly what I took from it on the first read.

Anyhow, thanks all for all the comments. I realize, of course that NASI and NYSI are coming off of their highest readings since 2003, and I too, have to be concerned about what the "big picture" message is in that- whether that's a prelude to a new bull, or just the way the deepest oversold in a generation "corrects" before the big bear resumes. But I'll stick with what's working 'til it doesn't. ;) :huh: Gotta go buy another lime for my coconut to relieve my belly ache. Good trading all, D
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.” Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds

#17 Echo

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Posted 17 May 2009 - 05:46 PM

Russ, Don,

Your point is well taken that this last drop and pop redefined historical extremes going back over 60+ years.
For the record, I'm short with you looking for the Hurst 10wk low, which after looking at the near term data should come in on Monday +/- 1-2 days. After that, cyclically, we should get a pop, but there are no guarantees. Price will follow breadth as night follows day. If the pop is meager and we break the 10wk low, then that is very bearish, especially if we break the NYMO and NAMO divergent lows of March 6-9.

However, for a nice review of the McSum 3 step pattern, I refer you to a post by Randy, who puts up numerous incredible posts. His data was suggesting that 777 on the SPX would hold last summer, and of course, it broke down violating a pattern for over 80 years, so no hanging a hat on this upside 3 step pattern for 100% accuracy, but of course, outside the extraordinary, the odds are fully on the bullish resolution historically.

http://forums.techni...post?id=2701601 for a beautiful review of this important technical tool.

Echo

#18 snorkels4

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Posted 17 May 2009 - 06:03 PM

back testing? i cant do that maybe saying oscillator divergences are unreliable in backtesting? but i dont know.
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http://www.zimbio.co...Veyron Crashing

#19 IYB

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Posted 17 May 2009 - 06:31 PM

Russ, Don,

Your point is well taken that this last drop and pop redefined historical extremes going back over 60+ years.
For the record, I'm short with you looking for the Hurst 10wk low, which after looking at the near term data should come in on Monday +/- 1-2 days. After that, cyclically, we should get a pop, but there are no guarantees. Price will follow breadth as night follows day. If the pop is meager and we break the 10wk low, then that is very bearish, especially if we break the NYMO and NAMO divergent lows of March 6-9.

However, for a nice review of the McSum 3 step pattern, I refer you to a post by Randy, who puts up numerous incredible posts. His data was suggesting that 777 on the SPX would hold last summer, and of course, it broke down violating a pattern for over 80 years, so no hanging a hat on this upside 3 step pattern for 100% accuracy, but of course, outside the extraordinary, the odds are fully on the bullish resolution historically.

http://forums.techni...post?id=2701601 for a beautiful review of this important technical tool.

Echo

Thanks very much Echo. Very interesting review. It is certainly one that I will respect and monitor, going forward. My two reservations are (1) that there are only 7 examples shown, 4 resolving very bullishly, one resolving with a nominal new low later (full retest), one (2008) resolving with one of the biggest market collapses of the last century, and one (2009) yet to be resolved, so I'm not convinced of statistical significance in a sample that small and inconclusive..... and (2) that the current market decline from late 2007 to early 2009 is already the single worst percentage decline in 80 years so that historical norms of the last 50-60 years may be challenged. However, as said, this McSum three step analysis is certainly not to be ignored either.

IF we resolve bullishly in 2009, which for the record I do NOT expect, I hope and trust that my seven friends will let me know in real time as that is happening. ;)

Very Best Regards, D
“Men, it has been well said, think in herds; it will be seen that they go mad in herds, while they only recover their senses slowly, one by one.” Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds

#20 Echo

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Posted 17 May 2009 - 11:46 PM

"IF we resolve bullishly in 2009, which for the record I do NOT expect, I hope and trust that my seven friends will let me know in real time as that is happening."

Hey D, I trust your seven friends will always treat you well. Best of luck & skill with your trade. Glad to be on the same side. Just have to decide if to take profits in the next day or so, or let it ride and let the stops take me out.

Very best regards to you as well,
Echo