Charting the Crash

[theasxgorilla]

Those choppers look a bit on the cheap side...wonder if they're locally produced or offshored? This credit squeeze is really starting to bite

 

[wayneL]

Those choppers look a bit on the cheap side...wonder if they're locally produced or offshored? This credit squeeze is really starting to bite

It was a rush order!

 

[theasxgorilla]

There's no longer any T (team) in PPT...its just PP, or more affectionately, BB. Spare the reserves, BB has been spotted single handedly supporting prices, among other things:

 

[doctorj]

You must be loving this wayne! I gotta ask, you've been talking up exactly this for some time now. Have you profited from being prepared? Is your trading going to plan so far?

 

[Sean K]

Is it a crash yet? I don't think so. I'm not giving out any pats on the back till I see CRASH! Not just a nice healthy correction.

I'm going back to my cave now with the other muppets.... :hide:

 

[doctorj]

Fair enough, though after doing what I did this morning, I feel a little better to see things unfolding as they are, so I'm happy to join wayne in his rain dancing for the time being.

 

[wayneL]

You must be loving this wayne! I gotta ask, you've been talking up exactly this for some time now. Have you profited from being prepared? Is your trading going to plan so far?

I diversified into commod futures precisely to somewhat avoid this sort of thing being too big a deal.

My modus operandi in extreme volatility situations like this is to daytrade it. This is what I've always done in uncertain times in the stock market... times like this, earnings season in stocks etc. It has always served me well.

Straight out shorts held overnight is too dangerous IMO because of the Fed interference.

But yes, the volatility is nice to trade on a daytrade basis.

For instance the market internals said to go long from about 11AM NYT, (TICK divergence, TRIN change of trend) with the first exit signal a moment a go (TICK extreme @ 12:22PM). The whole move was 200 Dow points which is $1,000 per YM contract in just over an hour.

Nice work when you can get it.

 

[Sean K]

I do believe that the conditions for this correction (crash ) may be different than previous ones, but I wonder if that is only because we are inside it at the moment and have forgotten the previous ones? :dunno:

This movement looks a little steeper than previous ones, but if the long term bull is intact, then perhaps we'll find support around the 200 d ma, as we have for the past 3 years.

Or, Wayne is right, and the muppets have cocked up the financial system and the greedy consuming human has spoiled the party!

 

[chops_a_must]

But yes, the volatility is nice to trade on a daytrade basis.

For instance the market internals said to go long from about 11AM NYT, (TICK divergence, TRIN change of trend) with the first exit signal a moment a go (TICK extreme @ 12:22PM). The whole move was 200 Dow points which is $1,000 per YM contract in just over an hour.

Nice work when you can get it.

Yep, it's this volatility that has me salivating about eventually becoming a day trader. I have a long way to go in just hanging around and learning, but are there any tips to speeding it up Wayne?

Plus at the moment, the confirmation of correct direction of trades is very fast... so the R/R is compounded on these already enormous swings. There are going to be many many new multi millionaires being made in this short period...

 

[theasxgorilla]

Its nasty to be in the market at the moment (and holding over night) due to the volatility. But I agree that in the context of the last few years AND other real bear markets or price collapses this is still mild. I dare say it won't be long for us to know either way whether this is more or less of the same.

 

[chops_a_must]

I diversified into commod futures precisely to somewhat avoid this sort of thing being too big a deal.

And P.S., that man of yours... despite both of our opinions, appears to be correct as metals are looking strong. Perhaps a long awaited decoupling between materials and financials that I have been calling on for ages may happen...

P.P.S. wouldn't China be laughing its box off right now? After months of us telling them they have a bubble and are heading for catastrophe etc. we are the ones experiencing/ looking at exactly that.

 

[Sean K]

Its nasty to be in the market at the moment (and holding over night) due to the volatility. But I agree that in the context of the last few years AND other real bear markets or price collapses this is still mild. I dare say it won't be long for us to know either way whether this is more or less of the same.

Yes, the question is whether the financial systems can sort this out or not. Wayne is saying no, I guess. I have no idea.

 

[wayneL]

Yep, it's this volatility that has me salivating about eventually becoming a day trader. I have a long way to go in just hanging around and learning, but are there any tips to speeding it up Wayne?

The most honest and best source of info on daydrading (and swingtrading) in my opinion is John Carter (USA centric of course)

His book is excellent http://www.moneybags.com.au/default.asp?d=0&t=1&id=5058&c=0&a=74

and runs a website which I've mentioned here before www.tradethemarkets.com Hellishly expensive to subscribe, but if serious should be considered. (disclaimer, have not subscribed myself) They also have a free daily video they send out which you can sign up for.

I reckon the book is a must read.

(all the usual disclaimers, no connection to them etc.)

Good luck

 

[wayneL]

Yes, the question is whether the financial systems can sort this out or not. Wayne is saying no, I guess. I have no idea.

They'll sort it out, but it's like an athlete who has allowed themself to become obese. Lot's of hard work, pain, and going without to get back to peak, meanwhile the challengers (China et al) are fightin' weight and ready to rumble.

A tough challenge ahead.

 

[chops_a_must]

The most honest and best source of info on daydrading (and swingtrading) in my opinion is John Carter (USA centric of course)

His book is excellent http://www.moneybags.com.au/default.asp?d=0&t=1&id=5058&c=0&a=74

and runs a website which I've mentioned here before www.tradethemarkets.com Hellishly expensive to subscribe, but if serious should be considered. (disclaimer, have not subscribed myself) They also have a free daily video they send out which you can sign up for.

I reckon the book is a must read.

(all the usual disclaimers, no connection to them etc.)

Good luck

Funnily enough... I'm 3/4 of the way through that book...

But I've used it for strategies over all time frames. And yes, it is a great book.

I will bother more people when the markets aren't open.

Thanks for the speedy response.

Cheers,
Chops.

 

[nomore4s]

I have a question for the fundamentalists.

Now I don't want to start an arguement between the FA's & TA's, I'm just curious about a few things.

During this correction I have heard on numerous occasions "the fundamentals haven't changed".
Now from my very limited understanding, surely the fundamentals have changed? There's been a tightening of credit & liquidity problems already which could get worse, the sub prime issue which "should be contained" has caused problems with hedge funds etc, and no one really knows just how deep this really runs, ie hedge funds probably haven't processed all the redemptions from people trying to exit these funds(due to the problems in the markets atm), so could this cause more liquidity problems and panic in the markets when these funds start freezing funds? Surely it will be months before we know the full extent of the damage done?

My question is how do you know the fundamentals have or haven't changed? Surely by the time we (people like me who don't have access to some of the more detailed info - would mean nothing to me anyway) know for sure, it'll be too late won't it?

I know some of these views are over simplified, but I would like to know when a fundamentalist would start to realise things are/have changed?

Thanks in advance for any replies, and no arguing between the FA's and TA's:

 

[Ken]

If the media didn't report these things, we as investors would be none the wiser.

It is just another excuse for the market having a correction.

They could be saying that China imported less iron ore, or oil prices will drop come December.

Whatever it is, there are reactions.

The fear is from seeing it in the media.

Stocks are not allowed to fall for no reason.


I am sure there have been credit problems before.

There will be other issues that come up in the future, but if the market keeps going up who wants to hear about them...

When the market is going full steam ahead, that is when you have brokers pusing price targets.. what happens when they get there??? They falll down.... and then something comes up like we have today...

If you fast forward 6 months where will we be? I would guess gearing up for another run.

This sell down will create a prolonged buying opportunity in my opinion.

 

[Uncle Festivus]

Newsflash: Hank Paulson & Ben Bernanke have officially swapped positions. Reports say Paulson is now closer to a Rock & Bernanke is now closer to a Hard Place. Both say there is still very little room to move.

 

[krisbarry]

My question is how do you know the fundamentals have or haven't changed? Surely by the time we (people like me who don't have access to some of the more detailed info - would mean nothing to me anyway) know for sure, it'll be too late won't it?
:

The trick to changing fundamentals is governed by which stock market discussion board you frequent

Posters on hotcopper have the 3 second rule, much like a goldfish It takes them 3 seconds to turn bearish, from being bullish.

I have noticed on ASF its seems like a few days to a week

As for TA and FA I wouldn't have a clue, just adding some comical relief Best leave the TA and FA debate up to the big boys!

 

[tech/a]

Its not about the fundumentals of the market.

Its all about the DRIVERS of the market,Sub prime fears and tightening of credit are all real and certainly driving the market.

Everything else is just dandy!