XAO Banter Thread

Tysonboss1 · 19 May 2011

I often read the posts on this thread and it's sister thread, just to see what different people think.

Is it just me, or are the majority of predictions made here wrong. I would expect at least a 50/50 mix. But most cases it seems when people come out with a prediction one way or another they are mostly prooven wrong quite quickly.

nunthewiser · 19 May 2011

nunthewiser said:
personally think it sitting around a major pivot point and would expect a bounce around here.

i could be wrong

often am

Tysonboss1 said:
I often read the posts on this thread and it's sister thread, just to see what different people think.

Is it just me, or are the majority of predictions made here wrong. I would expect at least a 50/50 mix. But most cases it seems when people come out with a prediction one way or another they are mostly prooven wrong quite quickly.

Not this one Bud

guaranteed wrong next call tho....ya get that

nulla nulla · 19 May 2011

The rest of the world bounced so the xao went along for the ride. Hoewever, the real problem is that the USA has been running the money printing machine non stop and nothing has changed.

Their unemployment has not improved;
Housing construction is at an all time low..still;
Businesses are sitting on huge amounts of savings rather than create jobs and develop infrastructure; and
China has bought up all the bonds and can now call in the debts any time it feels inclined.

The USA needs to increase interest rates and taxes on business as well as the wealthy. Start tightening the belt and reducing their debt. But that is unpalatable as it doesn't win votes. So they keep digging the hole. They can't even go to war with Pakistan to stimulate their economy because they are already overstretched in Afghanistan and Iraq. Above 12000 the djia is a bubble waiting for an excuse to pop.

In Australia investments in the xao are low. Volumes have been decreasing since the dollar started rising as overseas investors cashed out. The punters know that the djia is a bubble waiting to pop and has climbed into the 12000 - 13000 bracket on misplaced euphoria. The punters are all pulling their funds when the xao claws it's way above 5000. There is a fairly clear pattern there for the traders.

Anyone thinking we can sustain a climb above 5100 really needs to have a good long think about it. The USA is stuffed, China keeps putting the finance brakes on, slowing resource imports etc and the European Soveriegn debt has been managed by a bloke that chases hotel maids arround wanting to sodomise them.

Lets face it. At best we can go sideways for a long time until the world takes a reality check and decides to do something realistic about it.

nunthewiser · 19 May 2011

personally i think we reached close/if not the top of this current lil rally and we due to head south again...

i could be wrong.....laws of averages dictate i should be.

ya get that

RazzaDazzla · 19 May 2011

Nulla Nulla,

I agree with you 100%. However the truth is, NOTHING is spooking the market at the moment. Look at all the crap that has been thrown at it and it shakes it off and keeps on moving. Wars, riots, revolts, sovereign debt, earthquakes, tsunamis, nuclear meltdowns.

Maybe this is your point though; there's a lot of crap that is just 'itching' to pull the market down; and once the money presses stop, the party's over?

Nun,

Just curious for your thinking re. this little rally is over and back to the down trend?

nunthewiser · 19 May 2011

RazzaDazzla said:
Nun,

Just curious for your thinking re. this little rally is over and back to the down trend?

Purely technical and my reading into what i can view from here.

i could be wrong

Gringotts Bank · 19 May 2011

The market hasn't felt this weak in years, imo. XAO is sort of meandering with no conviction. I agree it has zero chance of getting above 5000 in the short to medium term. Looks like it's deciding when it's going to die. Geeez. Depressing.

Strong day from PIR. That's about it.

Synergy · 19 May 2011

Europe looking quite strong tonight, and US is pointing up again.

Things always feel weak before strong up moves.

I still feel that the March low will really take some breaking. And there have been 5 clear waves down in this move.

nulla nulla · 20 May 2011

So after a bounce the xao suddenly turns constipated and can't make any further progress. Must have been a dead cat bounce and next week the xao will crap itself and fall like a brick. Lets hope it can hold 4650.

Boggo · 23 May 2011

nulla nulla said:
So after a bounce the xao suddenly turns constipated and can't make any further progress. Must have been a dead cat bounce and next week the xao will crap itself and fall like a brick. Lets hope it can hold 4650.

Seems to be an area of attraction/support in the mid to low 4600's if the 16th May low gets taken out.

(click to expand)

tothemax6 · 23 May 2011

Tysonboss1 said:
I often read the posts on this thread and it's sister thread, just to see what different people think.
Is it just me, or are the majority of predictions made here wrong. I would expect at least a 50/50 mix. But most cases it seems when people come out with a prediction one way or another they are mostly prooven wrong quite quickly.

Awesome, I shall use this thread as an inverse trading signal .
To be fair though, what do you expect when people are relying so heavily in line voodoo, ahem, 'technical analysis'.

Indeed, (and forgive me nulla for being a c__t) let me provide a sample of the sort of insight into the markets which produces much of the random predictions:

nulla nulla said:
nulla nulla said:

So after a bounce the xao suddenly turns constipated and can't make any further progress. Must have been a dead cat bounce and next week the xao will crap itself and fall like a brick. Lets hope it can hold 4650.

Click to expand...

Tysonboss, I don't know about you, but it is a great act of mental exertion on my part, to visualize a stock index 'getting constipated', 'bouncing like a dead cat', then 'crapping itself and falling like a brick'. To be honest, any attempt at such a visualization has me rolling round on the floor in tears of laughter. Who needs 'Me, Myself and Irene', when you can scroll through such a thread.

Gentlemen, believing that the future price action of asset X can be determined primarily by its price history, is mathematically and logically speaking, impossible. It is a self reference error, you are attempting to deduce the output of a system who's output is determined by it's input - which is its output.
The future price action of asset X is determined by information external to X, else X must be random due to being coupled to nothing but itself.

woomp001 · 23 May 2011

Gentlemen, believing that the future price action of asset X can be determined primarily by its price history, is mathematically and logically speaking, impossible. It is a self reference error, you are attempting to deduce the output of a system who's output is determined by it's input - which is its output.
The future price action of asset X is determined by information external to X, else X must be random due to being coupled to nothing but itself.

My view is that if you are trying to accurately "predict future price action" then this is kinda correct... However, i feel that this position is to strident, and that historical price action has its place, particuarly when used as a guide, and particuarly when looking at support and resistance. I think we need to remember that herd mentality, as much as actual fundamentals drive prices, and herd mentality is often created by support/resistance (aka historical price action).....

skc · 23 May 2011

tothemax6 said:
Gentlemen, believing that the future price action of asset X can be determined primarily by its price history, is mathematically and logically speaking, impossible. It is a self reference error, you are attempting to deduce the output of a system who's output is determined by it's input - which is its output.

The future price action of asset X is determined by information external to X, else X must be random due to being coupled to nothing but itself.

Your logic is not necessarily correct. Yes, historical price is the input to technical analysis. But historical price is the output of external information (as you've pointed out). So you can say that technical analysis is actually using historical price as proxy to decode those external input variables. As such, using historical price in attempt to understand the future doesn't lead to the conclusion that a share price must be random. It also doesn't mean whether it works or not - but your conclusion isn't correct.

The root of certain schools of technical analysis actually has a lot more in common to fundamental analysis than meets the eye... although I am not saying that about things like wave theory etc (not saying people can't make it work, but I remain a sceptic).

nulla nulla · 24 May 2011

As we know the market is driven by sentiment. We also like to believe that F/A and T/A have some basis in determining a shares worth. Then we look for "market indicators" that give us some idea as to what everyone is thinking and how it will determine which way the share prices move. Charts are a very good way of showing market sentiment.

Charts show us interday, daily, weekly movement. Over time we refer to high points and low points as resistance levels and support levels. Then we make predictions (except elliot wavers) which we can get right or we can get wrong. If enough of the people following charts believe in the points of resistance and support and trade in line with their beliefs, the chart indicators will be self fullfilling.

At the moment (in my opinion) the djia is over-inflated and the world knows it is unsustainable. Accordingly (in my opinion) there is a lot of people that are skittish and ready to pull their money out. There are also the large hedgefunds that have pushed the djia up to false highs and they must be getting ready to short the crap out of the djia and any other market where they can get away with it. The bubble will burst.

The xao closed down yesterday and is likely to close lower today (continue crapping itself and falling like a brick, for now?). I believe this because volumes are generally lower, buyers are holding back, sellers are pushing the prices lower and shorters are encouraging prices to go lower still (a bit of the "stay away in May" theory).

However, our economy is sound and the xao prices will rebound. Now is the time (in my opinion) to look for entry prices on the stocks you have researched and know so well, to take advantage of the rebound that will come, whether it is next week, next month or next quarter. Good luck

tothemax6 · 24 May 2011

nulla nulla said:
As we know the market is driven by sentiment.

OK sure, but market sentiment is driven by individuals processing information. No tech/a price pattern ever prevented a stock from shooting up or down on a news event. Tech/a is ultimately, processing second hand information. Others have made their decisions based on the information at hand, made purchases, which techies will then process second-hand at a substantial lag. Sure, there is most likely a small amount of information contained in the price action over time, and sure much of that will be techies teching each other, but this is a shout in a thunderstorm of economics.

The question you should be asking, is what initiated the change in 'market sentiment' that led to the recent downturn. For instance, could a techie have known this change was coming? No, he would be subject to the random chance of a prior chart peak at a similar price (for 'support') telling him, or he would be waiting for the drop to become big enough to call it a trend (too late).
A good trader, on the other hand, knew what was going on in the Chinese construction industry, and saw a piece of news: 'copper piling up in LME'. He saw news about developers finally having to drop prices. He also knew where all that Aussie coal and iron ore was going. He knew that the RBA was tightening the money supply, that no good economic news was going to come from the US, that the EU wasn't going to provide any form of good news because its an economic basket case, etc etc etc.
When you know what the news is going to be before it happens, you know what 'market sentiment' is going to be, and in turn what the price action will be. By the time the techies receive the scraps, the correct trade has already been executed (and possibly closed) by those with the insight.

skc said:
Your logic is not necessarily correct. Yes, historical price is the input to technical analysis. But historical price is the output of external information (as you've pointed out). So you can say that technical analysis is actually using historical price as proxy to decode those external input variables. As such, using historical price in attempt to understand the future doesn't lead to the conclusion that a share price must be random. It also doesn't mean whether it works or not - but your conclusion isn't correct.

Thankyou for your rebuttal. If:
Out = f(Out), then:
Out = f(f(f(f(........infinity......Out)))))).....
So perhaps the word I was looking for, rather than 'random' is 'indeterminate'. Although of course, if something is random it is indeterminate, though I don't think the opposite is true (but my maths is a little rusty).

ginar · 24 May 2011

tothemax6 said:
OK sure, but market sentiment is driven by individuals processing information. No tech/a price pattern ever prevented a stock from shooting up or down on a news event. Tech/a is ultimately, processing second hand information. Others have made their decisions based on the information at hand, made purchases, which techies will then process second-hand at a substantial lag. Sure, there is most likely a small amount of information contained in the price action over time, and sure much of that will be techies teching each other, but this is a shout in a thunderstorm of economics.

The question you should be asking, is what initiated the change in 'market sentiment' that led to the recent downturn. For instance, could a techie have known this change was coming? No, he would be subject to the random chance of a prior chart peak at a similar price (for 'support') telling him, or he would be waiting for the drop to become big enough to call it a trend (too late).
A good trader, on the other hand, knew what was going on in the Chinese construction industry, and saw a piece of news: 'copper piling up in LME'. He saw news about developers finally having to drop prices. He also knew where all that Aussie coal and iron ore was going. He knew that the RBA was tightening the money supply, that no good economic news was going to come from the US, that the EU wasn't going to provide any form of good news because its an economic basket case, etc etc etc.
When you know what the news is going to be before it happens, you know what 'market sentiment' is going to be, and in turn what the price action will be. By the time the techies receive the scraps, the correct trade has already been executed (and possibly closed) by those with the insight.

Thankyou for your rebuttal. If:
Out = f(Out), then:
Out = f(f(f(f(........infinity......Out)))))).....
So perhaps the word I was looking for, rather than 'random' is 'indeterminate'. Although of course, if something is random it is indeterminate, though I don't think the opposite is true (but my maths is a little rusty).

what a load of bollocks , just because " YOU " cant do it means no-one can . i have nothing to gain proving to you can outperform the market using " voodoo " so i will continue to do what i always do and say nothing , please those with open minds continue to explore the simple effective ways price structure can be read and used to improve returns , dont let intellectual dribble put you of . swing highs /lows , ranges , cycles of time over price can all be used extremely successfully to outperform .

trading of news ........ by the time you hear it ....... its priced in

RazzaDazzla · 24 May 2011

tothemax6 said:
A good trader, on the other hand, knew what was going on in the Chinese construction industry, and saw a piece of news: 'copper piling up in LME'. He saw news about developers finally having to drop prices. He also knew where all that Aussie coal and iron ore was going. He knew that the RBA was tightening the money supply, that no good economic news was going to come from the US, that the EU wasn't going to provide any form of good news because its an economic basket case, etc etc etc.

A good trader (and blind freddy) knew that an earthquake and tsunami smashed Japan and that a Nuclear emergency was happening. They also know that USA and Euro debt is sky high! Yet look at the rally after the quake! FA did not say "this is a great time to buy!" My point is, everyone knows there are major issues in the world yet no one want's to be the first one to jump ship. If all these issues can't cause the markets to fall over; then what will it take? People are shouting from the rooftops that the sky is literally falling and the markets will collapse, yet they are not. I personally believe that TA can be used as a GUIDE to see into the mob mentality.

IMO from my limited humble experiences: whether you read tea leaves, flip a coin, use FA or TA; develop a system with a positive expectancy and stick to it.

LifeChoices · 24 May 2011

tothemax6 said:
A good trader, on the other hand, knew what was going on in the Chinese construction industry, and saw a piece of news: 'copper piling up in LME'. He saw news about developers finally having to drop prices. He also knew where all that Aussie coal and iron ore was going. He knew that the RBA was tightening the money supply, that no good economic news was going to come from the US, that the EU wasn't going to provide any form of good news because its an economic basket case, etc etc etc.
When you know what the news is going to be before it happens, you know what 'market sentiment' is going to be, and in turn what the price action will be.

I'd just be happy to know on Thursday afternoon what Diggers and Drillers are going to publish on Friday.

Boggo · 24 May 2011

tothemax6 said:
Tech/a is ultimately, processing second hand information.

So is the meteorologist who provided the information on what the weather will be tomorrow or don't you believe that either.

Education = behaviour modified by experience.

tothemax6 said:
though I don't think the opposite is true (but my maths is a little rusty).

So is your logic

skc · 24 May 2011

tothemax6 said:
Thankyou for your rebuttal. If:
Out = f(Out), then:
Out = f(f(f(f(........infinity......Out)))))).....
So perhaps the word I was looking for, rather than 'random' is 'indeterminate'. Although of course, if something is random it is indeterminate, though I don't think the opposite is true (but my maths is a little rusty).

Logic is still wrong.

Say I go to a fortune teller who reads tea leaves to find out what my future holds. It doesn't mean that I believe the tea leaves are input to my future. I am simply believing that the tea leaves for some reason can forecast / predict / describe with some probability my future.

Same with technical analysis. You don't have to believe it, but you haven't disprove it with the logic you are offering.

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