5 replies to this topic

[hiker]

closed the week just above major horizontal support at 1432 which was tested late Friday

weekly chart below, with major horizontal supports shown

the discipline of buying support and selling resistance applies in all circumstances, even when it does not "feel" like the thing to do.

successive R selling at 1484-1488, then 1470/1474, then 1465 on Friday, then 1447/1454 later on Friday...now is it time to buy support at 1432, or wait for lower support level at 1404 or lower?

any one in the mood for a poll ahead of Monday? anyone buy 1432 on Friday and carryover the long through the weekend?

looked like the thing to do to me if following the buy major support/sell resistance rule....when buyers were absent and only sellers were present into the close Friday....definitely countertrend, which it always is when buying a test of major support.

was it simply an overthrow on a Friday retest of the recent low, and retest of the .618 retrace of the March low to 1555 high...this convergence of data items timed on a late Friday afternoon looks and "feels" like a setup to me.

Edited by hiker, 04 August 2007 - 10:12 AM.

[hiker]

is there not some logic supporting the thought it would require much energy to move price levels to 1404?. what would be required to bring about sufficient energy in the price and volume considerations to produce a move to 1404, after the energy that has been expended on this move from: support failure at 1484/1488 to Friday's test of major support at 1432? for kicks, let's break down the 123 pt decline from 1555 to Friday's low of 1432 the move from 1555 to 1484 where support failed, is .577 of the 123 pt. decline the move from 1484 to 1432 is .423 of the 123 pt. decline pardon my lack of precision, since Friday's low was 1432.80

Edited by hiker, 04 August 2007 - 10:30 AM.

[hiker]

let's break down the 122.2 decline (more precision now) in a different way- 1555 to 1476 major horizontal - .65 1476 to 1432.80 low so far of this decline sequence - .35

[hiker]

fyi for perspective, the last paragraph in this thread posted the importance of this major horizontal support at 1432 on Friday within a half-hour of the close when I was short at the time, posting my real-time thoughts about the ongoing trade -

http://www.traders-t...showtopic=73830

an update -

1447/1448 needs to be overcome before this weakening pattern returns to at least neutral..it could be expected to see a bull/bear battle in that price vicinity followed by 1454/1458, if any price advance follows from here.

no matter what happens in the coming days/weeks....the 20+ year log chart shows a channel bottom near 1365 that may be a magnet during further panic (or "orderly selling") from whatever cause, even if downside gaps calling out to be filled provide some relief bounce support...and this channel bottom converges with 1370 major horizontal support..so, it is important to take some measures beyond awareness of this potential.

Edited by hiker, 04 August 2007 - 11:07 AM.

[beta]

Great posts, Hiker -- I was reading your intraday posts from Friday and amazed that you could think/post/trade all this in real-time ! Im thinking we are within 1% of the end of wave "A," and could see a bounce up to the 1480-1500 range before the next leg down begins. Agree that the final target for this correction is more likely mid-1300's. One observation: most of the prior corrections have been led to the downside in both price% and time. However, current sector leaders like commodities (metals and energy), have not moved much (yet) in this decline (except for uranium). Does this mean that selling will rotate into these groups next ?? I wonder what it means when the leaders are the last to break down.

Edited by beta, 04 August 2007 - 01:21 PM.

[relax]

Seems like area around 1.370 is important it is also fib 6.85 of the first move down from 1.555 to 1.529 Also fib 1.618 of the first move down from 1.555 to around 1.450 gives an area around 1.380