26 replies to this topic

[mmm]

I think you are a great technical analyst TT with much thought into what you do; but I think your underlying fundamental reasoning may be off base a little. These ideas there is a PPT that on a regular basis is in the market to manipulate prices higher and give confidence to traders and is run by the Feds is hard for me to swallow. I believe (and Bernanke has indirectlly stated the existence of the PPT ) that under unusual circumstances the PPT may come to the rescue. There is manipulation of the markets by individual hedge funds, market makers, propriatery trading desks on a day to day basis but under long term conditions no one controls the markets. What has been going on here imho is normal market action. The sell off is normal so far and if a bear market develops then so be it; but I do not believe it is engineered by anyone. It is of no one's interest to have a bear market. These are my thoughts and I hope to see more of your insights TT. Thanks for your posts. (I wish this had a spell checker)

[Trend-Signals]

GOOD MORNING, ALL Thanks, MMM, True, for most of traders, some of what I express is perceived as off-base thinking. Of course, I could also say that you are a little off base because you do not see underlying forces. But then again, what I noted is hard to prove such as market psychology. Those who are thinking based on proven facts would think exactly the same as you are as you have noted. As for market actions, it is also based on market psychology and other forces which are hard to prove. As for PPT actions, I have encountered debates on the existence of PPT, the function of PPT, capability of PPT, etc.; so, I understand your point of view and consider it as "Text book and safe answer", as Bernanke also stated. I try to be diplomatic with responding to your comments, but you will see that I express freely on my iHub board. It is easier to deal with market technicals than market psychology and underlying forces/manipulation. Hedge funds will be greatly benefited by sharp sell-off like crash, e.g. 1987 crash triggered by one big investors sell off with 1929 analog. I don't want to open another bag of worm discussing 1987 crash, but my conclusion is based on what I chose to believe after researching various writings for the cause. When I mention market psychology/force, I consider various factors so it is not easy to debate with proven facts. Also, you can not prove that there is no market manipulation either and "Normal market action" encompasses vast realm. Nevertheless, I admit that your comment is textbook and safer opinion. Thanks for the comment. PS With good fund $$$$$$, 10% gain using major market ETFs in a week. Alerted contra major market ETFs on 7/20 with comments that market is due of a correction and a top formation. Those who timed the market for this sell-off and other sharp sell-off would have made fortune. This is the reason that having influence to market is benefited by both long/short sides. So far, major markets corrected: As of Friday close, 7/27/07, markets have corrected without a meaningful bounce: SPX 6.18% DOW 5.32% Nasdaq 5.92% Qs 5.17% $Tran 8.14% $NYA 7.03% $MID 7.31% $OEX 5.71% $RUT 9.28% $SOX 8.48%

Edited by Trend-Signals, 28 July 2007 - 07:14 AM.

[Trend-Signals]

My market breadth analysis shows that most of market breadth hit major bottom level. $NAMO weekly shows the lowest reading since 2002, as shown $NAMO chart above.

Another example, $SPXA50 shows extreme reading which is normally a major bottom. I warned about the "non-confirmational SPX breakout" above SPX 1540 a week ago.


http://stockcharts.com/c-sc/sc?s=$SPXA50&p=W&yr=4&mn=0&dy=0&i=p73609511954&a=68421789&r=495.png

Edited by Trend-Signals, 28 July 2007 - 08:17 AM.

[relax]

Great charts - thanks for posting - it has been a while ;-) So are you saying that we are very close to a bottom? and is this an IT bottom? july 31 is 20 weeks since the march 20 bottom, and july 27 was airedale's 4,5 year bottom at the same time we have not broken the short term trend for Nasdaq Composite, which has support from a trendline from july 2006 This trendline gives support at 2.520.2.530 I also look at the german DAX which is a great leading indicator, DAX's situation is a lot like S&P 500 fighting with resistance from seven years ago followed by a serious correction DAX also has short term support on the daily chart from a trendline from july 2006, giving support at 7.100 So maybe there is a 3 per cent left in this correction, but would be surprised not seeing a test of highs again the cycle bottoms support this maybe this will happen within the next 20 weeks The question is of course if we like previously start going up on low volume or if we make new lows after the first rally we will get some answers next week, when we see the strength of the rally

[Trend-Signals]

Hi DK, Good morning

Thanks, and Good question and comment. When I warned about a sharp sell off going into 7/19 top and alert of 7/19 top, I noted 9mo cycle top with Sept/Oct low.

I commented on 4yr cycle bottom during Jun-Jul 2006 bottom call with various cycle notation charts.

Whether this is a new IT cycle up, i.e. forming a bottom during the next 1-2 week to start a new up cycle to start a new bull market, NO, I do not think so. This opinion is based on my analysis of breadth, economic condition, geopolitical condition, market psychology, LT/ST cycles, etc.

This does not mean that we are entering a bear market either. Since my 4yr cycle bottom is Jun-Jul 2006 within 8yr up-cycle, bull/bear has balanced force at this juncture as far as I am concerned.

Still pondering about the last two days panic sell off and trying to put things in right perspective though.

http://www.stockchar...40300&r=617.png
http://www.stockcharts.com/c-sc/sc?s=$SPX&p=W&yr=4&mn=8&dy=0&i=p49229126946&a=78987374&r=825.png
http://www.stockcharts.com/c-sc/sc?s=$INDU&p=W&yr=4&mn=3&dy=0&i=p72794457382&a=76929550&r=647.png
http://www.stockcharts.com/c-sc/sc?s=$COMPQ&p=W&yr=4&mn=3&dy=0&i=p53935525265&a=77295648&r=218.png

Edited by Trend-Signals, 28 July 2007 - 09:21 AM.

[Trend-Signals]

DK, I am still doing my due diligence, but market actions are quite fascinating. Internals, price actions, sentiment, money flow, etc. are all over the map. However, more I study markets, market is not starting a new bull market with a major bottom even though market breadth is suggesting; however, we could see a continuation of the current up trend with greater probability than a start of new bull market. Big money is still in the market even though some sold in May and went away.

[relax]

We are losts of people pondering this could just be breakout retest for Nas Composite, even though it went just below the trendline from february 2004 top through feb 2007 top If Composite could quickly (monday or tuesday) get above that trendline that would support the argument of a breakout retest, which was the case for S&P in connection with the june correction Nonetheless it could seem as if all indexes are heading back within their trend, which might well lead to a test of the lower part of the trend followed by a big move up look forward to monday's action - enjoy the weekend!

[relax]

Just looking at your chart again, nas composite getting back within trend and testing the low of the trend would mean a move towards 2.400 (now 2.200 but rising) If we go back to january 2007 there was a candle which tested 2.645 afterwhich there were two candles which took composite down to 2.300 The first candle went to 2.400 and the second was a dragonfly doji with a low at 2.300 maybe this needs to tested again in 2007 followed by a move towards 2.900-3.000

[Trend-Signals]

Reviewing market calls, since my participation on public discussion board since Jul 2004, I accurately called market tops/bottoms including the current market action.

I alerted that I had initial sell signal in May 2007, if you review, you will find my post in May. That was the top in closing monthly basis. Then, I alerted 7/19 top which is exactly the daily top.

Now, the current market reading is not like those what I have seen before as noted market internals, price momentum, market psychology, money flows, etc., are all over the map.

Having said that, unless market holds critical support levels, e.g. SPX 1440+/-, market will turn market sentiment to negative.

Big money is sitting in the market and I think that it is in big caps. For example, note CMF on SPX weekly. Most of weekly CMF for major markets are showing the same CMF formation. This tells me that big money didn't exit market while small money sold market since May, refer to note above on Monthly chart.

We need to see snap back rally; otherwise, the big money might feel insecure. Then, we have seen anything yet.

http://stockcharts.com/c-sc/sc?s=$SPX&p=W&yr=4&mn=8&dy=0&i=p24761908766&a=78987374&r=630.png

[thespookyone]

Great work, and thoughts, thanks. Two things from my corner here- First, the proof of the PPT need not be established-to me, anyway. Trading for a living the last 25 years, I have seen changes in market trading. Much like when rain starts pouring down, I don't need to actually see the cloud that caused it-to know it was there. I have not actually seen the PPT cloud-but most certainly have felt their rain.I've seen other things over the years that effect the way the market gets traded, as well. One observation would be the change in play of hedge funds. When I was much younger, funds were mostly huge, and seriously arbitraged. With the advent of many small hedge funds over the years, and both large and small placing more "one way" bets, unhedged on the market volatility has risen. Hedge fund play in the oil market last year clearly accentuated movement there-with a couple fair size funds blowing up in the proces. Second, when I look at your QQQQ charts in many of your posts, I can only say-MOO. Considering the pattern the Q's broke out of, and the width of the pattern-I feel they have a lot of room to roam on the upside. Fundamental factors, such as the bettering of chip inventories should have the semi's throwing a little gas on that fire, as well.