Charting the Crash

[Magdoran]

Certainly a good call Mag. One thing I don't posess is a handle on time analysis.

Pacer,
That is a concern. Phew. I remember 1987 when people turned up at the door step...yikes!

Thanks Nick,

I remember the excellent call you made last time around with the price level for 10th May 2006… that was a great call too.

It’s nice when you can see the market clearly isn’t it? And we both know what a difficult thing it is to forecast consistently.

The problem now is, where to from here?

I have a hunch this is an 18 calendar day move, and there should be a retest of the high. Do we get a marginal high from here, or a lower high?

I just can’t see this being like the ’87 crash (unless the Yen carry trade really takes a toll – and that may take some time to become evident who gets hit and how hard, and organisations will try to bury this in paperwork for as long as they can before the reckoning, so we could see a prolonged campaign over time as revelations come in – but I’m speculating here. I really can’t measure this at all). It looks more like the ’94 scenario… we’ll have to watch this…


Regards


Magdoran

 

[Sean K]

GOLD got hammered pretty bad, but seems to on the way back up

Responding to 660 support. It's all too early to call IMO. The noise!!!

 

[TjamesX]

Looks like all eyes will be on China's open in about an hour

 

[2020hindsight]

I thought this was the year of the golden pig
only gold plated maybe?

(PS reluctant "well done" to all the bears who called this one - trouble is - it's like the boy who cried "bear" - after a while you become immune to the warnings )

 

[dubiousinfo]

Nikkei opened down 200 and moved further to be down 652 now.

 

[CanOz]

Shanghai up 60 pts.

 

[CanOz]

Heres a basic chart.

 

[KIWIKARLOS]

What is XJO and what is the shanghie index code?

 

[CanOz]

Dropped back a bit and bounced.

 

[CanOz]

Resilent bunch, i'll give them that much!

 

[wayneL]

Thanks Guys,

But one good call does not a guru make.

And my next call could be complete garbage – the market is a capricious beast. It’s just that this time I could see the cycles clearly, and the probabilities were high… but I can only do this in specific conditions.

All techniques have their day in the sun, but to think this kind of thing can be repeated 100% of the time is just not realistic.

To even think of being half as good as Bill McLaren would be an honour, but I’m certain I’m not even close to that. Bill has been in the market longer than many on the ASF have been alive. I have a long way to go to earn my stripes, and my work is still embryonic at best. Also, if I had never studied his materials, I would never have been able to see this…

I still consider myself at the intermediate level, and will be for at least another 5 years in my view. You need over a decade of consistent performance to rate in my view…

Also, beware this move, I suspect this is more like the 1994 high than a 1987 crash scenario. The fundamentals may hold the flow, unless the Yen carry trade blows a hole in the indexes… If short, take profits in an orderly fashion because this market can spike back quickly!


Regards


Magdoran

Nice balance there Mag.

As we know concentrating on who called what, where isn't where the profit is made. It is trading what actually happens. I say that not for your benefit, because I know you know that, but for the benefit of people like Crashy, who believes the call is all important.

 

[wayneL]

lol.

since the Dow was 10600 (and probly earlier) you have been telling us all the sky is falling. The market has done nothing but run since then, and anyone who listened to you has lost a bundle. yet here you are now, crowing about how right you were........yeah.....theres hypocracy all right. of course if you kept making the same call you would be right one day. what credit I will give you however, is that you called a fall during the day which eventuated. But winning one battle doesnt win the war.

and if I want to change tack to bear suit now, thats my right. I called the market up back then, remember?

"I suppose when the dow is 20,000 and XJO is 6000 that will still be the case?"

Crashy, my treacherous friend. You forget who your friends are.

As stated above, it's not the call, it's how you trade what's in front of you. I don't mind trading against my own sentiment, as detailed throughout this forum.

Calling this fall? Bah! it was bleedin' obvious.

 

[BSD]

I request this thread be renamed -

'Charting a Blip '

' Losing Four Weeks of Froth'

' Getting Wood over a Pullback'

' Noise Noise Noise"

'Much Ado About Nothing '

' Finally some Vol '

We can change it back we we have dropped the 1500-2500 points required for a CRASH

500 takes us back to Xmas.

 

[Kimosabi]

Well everything in Europe seems to be down 1% - 2% tonight so far, interesting to see what Wall Street does when they come on-line.

Just about the only market showing green is China, everyone else is Red

http://www.bloomberg.com/markets/stocks/wei.html

 

[theasxgorilla]

Also, beware this move, I suspect this is more like the 1994 high than a 1987 crash scenario. The fundamentals may hold the flow, unless the Yen carry trade blows a hole in the indexes… If short, take profits in an orderly fashion because this market can spike back quickly!

With the avg P/E for the XAO at just over 17, it's difficult to see the "fundamentalists" letting things get too out of hand.

 

[nizar]

Also, beware this move, I suspect this is more like the 1994 high than a 1987 crash scenario. The fundamentals may hold the flow, unless the Yen carry trade blows a hole in the indexes… If short, take profits in an orderly fashion because this market can spike back quickly!

JUst a note to keep in mind the Index has gained about 20% in the past 12 months. In the 12 months prior to the 1987 crash the Index had gained 88%.
BIG DIFFERENCE, i dunno why all the comparison??

 

[wayneL]

I request this thread be renamed -

'Charting a Blip '

' Losing Four Weeks of Froth'

' Getting Wood over a Pullback'

' Noise Noise Noise"

'Much Ado About Nothing '

' Finally some Vol '

We can change it back we we have dropped the 1500-2500 points required for a CRASH

500 takes us back to Xmas.

We only on day 2 and it is no fun calling a crash after the fact. This could take a year or more to play out, if indeed this is it.

' Finally some Vol '

Yes agree... at last.

 

[wayneL]

Woah - the DOW just GAPPED 180 points

Those program traders are a real good risk managment tool aren't they!


Down 530 now

BSD,

You might have read this already but FYI

http://www.reuters.com/article/fundsFundsNews/idUSN2845148420070228

NEW YORK, Feb 28 (Reuters) - Dow Jones Indexes expects the calculation of the Dow Jones industrial average to be glitch-free on Wednesday, the index provider said, a day after a computer system malfunction contributed to an abrupt slide in the blue-chip index as U.S. stocks sold off.

"Dow Jones is continuing to investigate the (system) latency issue to correct the root cause of the problem," Michael Petronella, president of Dow Jones Indexes, said in a statement.

With an hour left to trade, the Dow Jones industrial average fell more than 500 points as it abruptly added about 200 points to its slide in late afternoon trade on Tuesday.

According to Dow Jones Indexes, "unusually heavy volume" caused a 70-minute lag in correctly calculating the value of the Dow and the subsequent downward spike in the reported index value when the problem was corrected at 3 p.m. (2000 GMT)

 

[BSD]

Thanks for that Wayne

That gap was more interesting (and cool to see) than anything that came out of yesterday.

The look on CNBC's Money Honey's face was priceless.

A seventy minute delay? That is horrid when you consider the amount of program traders, equity arbs and hedgers trying to use the Dow index for whatever reason.

Imagine running an equity arb book on silly tight margins and finding out every trade you made was based on the index value 70 minutes ago.

That cannot be right

 

[wayneL]

Thanks for that Wayne

That gap was more interesting (and cool to see) than anything that came out of yesterday.

The look on CNBC's Money Honey's face was priceless.

A seventy minute delay? That is horrid when you consider the amount of program traders, equity arbs and hedgers trying to use the Dow index for whatever reason.

Imagine running an equity arb book on silly tight margins and finding out every trade you made was based on the index value 70 minutes ago.

That cannot be right

I recall when I first started trading futures about 4 years ago there was a fat finger event.

Someone accidently added an extra zero to a sell order at market and the dow futures tanked 5 or 700 points in a few seconds!

It was surreal, we (guys on MIRC) thought WW3 must have started.

But a few minutes later all was back to where it started. CBOT busted the trades however.

Certainly exciting when these things happen.