I was looking the wrong way

Guess I was looking for new highs after the market started to consolidate sideways but then it fell out the sky - haha

Thats 'falling wedge' was exactly that....falling!!

The market couldn't get any new legs and dropped on a dime....but not all hope is lost

I have been doing some more reading (Laundry et al.) and all have been calling for a mid-October top and then a big correction - possibly revisiting March lows.

Don't forget we are still in a 'bull' market (rally) and this could go either way.....

I'm looking for a sharp bounce on the XJO next week....the reason being the divergence between the XJO and the DJIA...the XJO has broker the 38.2% mark, while the DJIA is nowhere near it...

this will get interesting.....

XJO

DJIA

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Falling Wedge

With reporting season just about over and markets continuing their rise i think the 4th Q results will be very interesting. The 4th Q results will mark 10 months since the March lows and also 10 months of market stimulus. Will the stimulus wear off or are governments around the world still going to be pumping money into an every lasting 'black hole'......

Anyways here is a graph of a falling Wedge in a 'bull market', to me this is bullish.

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Reporting Season

Reporting Season in the US is well and truely under way.

Caution should be shown and trading kept to a minimum unless you have balls of steel. Stop-losses are HIGHLY recommended

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Market Psychology

Trading = NO emotions

When trading y0u should always close out the surrounding noise and trust your trading strategy and charts.

Obviuosly the other day i got a 'little' confused and started listening to the noise, the noise told me to do the opposite to my charts and that costs money.

Its a valuable lesson i learn ever now and then but i keep making the same mistake, why? I think its because i'm human and i will never learn but i can try and minimise it for future reference.

Anyways i've got a new strategy, here it is;




My 'old' expanding wedge (in red) is just about dead but i've drawn a new one (in black) its a little early but we will see what happens. As you can c i still favour the high side....that 50% fib line is looking mighty tastey right now.....

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Toss of the coin.......

Its time to close out those longs.....

I've been doing some reading and charting today and my thought process has been blurred. As you know i have favoured the upside for a while now but thoughts are creeping into my head, this is not good.

I have been listening to others and their suggestions and it is making my thought process blurry.
So.....its time to close out the longs and re-focus on a new game plan.

The Xjo is 'hovering' around an 'old' support line which is now reacting as resistence. This was highlighted yesterday in the two 'range bound' rectangles (red/green)



This next graph is the one that gives me shivers a little - i keep thinking if the 'top' is in then we will only make 'lower tops' and eventually enter a new down-ward channel.



finally a 'longer' term view. I was told that L-T timeframes should over ride the S-T timeframes but one day the reversal will come

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New range?

Well the XJO has done some 'line searching'

You ask what that is?? Well its bouncing around of Fib lines and 'key support and resistance lines.

This first graph shows the Xjo'breaking' down throught the old 'range' (in red) and falling to find support at the 38.2% fib line (Nov 2007 high - March 2009 Low). It has since bounced off the Fib line and hit the 'bottom' of the old range and filled the gap down.

has the XJO created a new range (s-t)???? This is highlighted in 'green'. Personally i think not, this market is moving and i think its moving UP. I know a lot of people have been calling this as 'the correction' and indicators have turned but we haven't had that final burst to really signal a 'blow off' top....i think its still coming





i think the 38.2% line will hold



Also this is the DJIA bouncing off the 38.2% line ASWELL....



seems to be key support for both markets.......

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Well.....

I still believe these markets are headed higher...it seem its consolidating around these levels.

XJO has fallen back to the bottom of the channel and is holding



while this is an updated DJIA chart.....its touched the bottom of the expanding wedge. It has bounced and now the big call is 'will it touch the top again'....time will tell




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