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geosing

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Posts: 356
Reply with quote  #1 

What is a daytrader doing looking at weekly charts? I am a measurement fanatic and always trying to see if there is any rythm in the market in the past that is likely to repeat in the future and also proportions of swings that are likely repeat. RUT is prone to make some precise moves. I use AB=CD logic all the time intraday. As I was updating the weekly matrix on the RUT, I noticed the repeating pattern.

 

 

The first pattern which took 36 weeks or so was repeated in smaller proportion next in 24 weeks.

AB swing of about 140 points retraced 61.8% but via an 1.2.3 move down. BC declined to 38.2% of the AB rally and then retraced 84% of the down move. And moved on to the designated 61.8% fibonacci level DE to complete the retrace and the pattern.

 

The very same pattern was repeated in the next 24 weeks. The RUT rallied up 84% of the first upleg AB in move size. And then did the pattern exactly like the previous one using the same proportions pricewise. And completed the 61.8% retrace to finish fractal #2. Not sure what the deal is with the 84% routine ... not really part of the fibonacci proporations. What market likes, market does. Never mind about Leonardo Pisano and his crazy series.

 

Now it appears to be doing edition #3 of the same move. Market is fond of doing stuff in threes and the pattern is evocative of 3 drives to the top with the thrust getting smaller with each rally effort. If this comes to pass, J is projected at 711-716 level. No guarantee that this would happen. But where is the harm in speculation - which is what we (at least I) do every single day. Fortunately I can project 606 and 706 and still plan to trade what I see at the open. Just like the market cares not about Leonardo's number series, it cares not about Geo's nutty projections. With Fib exciting everybody about a monster move coming, the RUT may break 1000.

 

 

Geo

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UFO

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Reply with quote  #2 

Geo, you always make me think.  Thx.

 

U.F.O.


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"Every normal man must be tempted at times to spit on his hands, hoist the black flag, and begin to slit throats."
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geosing

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Reply with quote  #3 

Hi UFO,

 

Thank you for bringing Mr Mencken back.

 

Let me remind you (and myself), thinking can be very harmful in trading.

 

Geo

One of my Mencken favorites:

 

"Perhaps the most valuable of all human possessions, next to an
aloof and sniffish air, is the reputation of being well-to-do.
Nothing else so neatly eases one's way through life... Give out
the news that one has just made a killing in the stock market,
or robbed some confiding widow of her dower, or swindled the
government in some patriotic enterprise, and at once one will
discover that one's shabbiness is a charming eccentricity, and
one's judgment of wines worth hearing, and one's political
hallucinations worthy of attention."

H.L. Mencken
"Smart Set"
May 1920

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UFO

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Reply with quote  #4 

Love ya geo.  Thx,

 

U.F.O.


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"Every normal man must be tempted at times to spit on his hands, hoist the black flag, and begin to slit throats."
~H. L. Mencken~
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geosing

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Reply with quote  #5 

Week # 4 into this RUT program. So far so good.

 

 

Another 4 more weeks to reach Point J.

 

Geo

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fib_1618

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Reply with quote  #6 
There is always order in the chaos that makes up the market.

Great stuff Geo..it really is beautiful to look at.

Fib




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geosing

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Reply with quote  #7 

Trouble is when you think there is order and act on it, market makes chaos out of the so-called order. No doubt that chaos of part of some other order and structure, but trade location and opportunity is gone by the time you recognize it.

 

The EF Leg is about 118 points. If the ratios hold, then IJ should be about 99 to 100 points, targeting 716 or so for Point J. I wish I could just buy a 10 lot ER2 and check the market in Mid December to see if I got rich or not. Since I would not do such a thing, it is just something to look at after the fact and mumble ... woulda coulda  shoulda ...

 

Geo

 

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geosing

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Reply with quote  #8 

The fractal symmetry continues to unfold as per script.

 

 

If the model stays true, a week of consolidation may be straight ahead. A pause before ramping up for Thanksgiving? The yellow trend line is where the RUT had to coil a bit before surging ahead. Such a line will be the challenge next week.

 

Also the RUT is at an interesting resistance point up against the Upper MLH of the downsloping ML Set. Some energy may be needed to do the TTT (Third Time Through - a setup I come across often in intraday trendlines). Backing off to the lower MLH of the upsloping ML Set might do the trick.

 

 

Just having some fun with this chart. I wish I could trade using these.

 

Geo

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geosing

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Reply with quote  #9 

The saga continues ... The expected pause did not materialize, as the Rut does the Energizer Bunny routine. TTT (Third Time Through) in the chart above is now an accomplished fact. A test of the break point may be forthcoming. RUT 700 almost for sure now.

 

 

 

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mortiz

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Reply with quote  #10 

Geo,

 

Thus far, RUT has certainly been following your road-map, nicely done!  I am assuming your intraday mapping has been as accurate?  According to your account value graph in another thread, I would think so.  That scale was in millions, right?

 

The RUT component cumulative $ weighted Up-Down volume ($UD) line is signal ling all is go thus far for an assault on 700.

 

 

The RUT component $UD MCO is voting 720 is likely as well.  Although the RUT $UD MCO is currently diverging in the very short term with the recent RUT price breakout, the MCO initiation thrust from the moderately oversold levels of the October price lows are suggesting more price upside ahead before this move is over.  Although the RUT component breadth indicators over the past year or so are showing decreasing participation of the broad spectrum of small caps, money is certainly still flowing into a lot of smalls in a big way.

 

 

 

From my daily RUT component downloads, I am putting together an unweighted version of the RUT index, but it is not quite ready for posting.  The limited unweighted RUT data processed thus far, is exhibiting moderate relative weakness with respect to the traditional RUT index over the past few trading days, thus we may be in for a few days of consolidation/correction.  However, the strength of liquidity and money flows into a broad range of indices over the past several weeks suggest this leg isn't finished yet.

 

Thanks for the update, amazing work......

 

Randy

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geosing

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Reply with quote  #11 

Randy,

 

I wish it were millions. While I was grabbing that chart for posting, I once again reviewed the early days. I saw that it took 129 trades for me to just breakeven after I started daytrading the futures. This despite having 87 wins to 42 losses - a result of eating like a sparrow and crapping like an elephant - put it somewhat crudely.

 

Thanks for the RUT update.

You state: "The RUT component $UD MCO is voting 720 is likely as well".

 

How do you arrive at this conclusion by looking at the MCO? The summation index appears to be at the September resistance levels, but it is all looking pretty bullish heading towards some sort of blow-off.

 

How do you compute an unweighted index? Straight addition of all prices of the components?

 

Thanks for the charts and analysis.

 

Geo

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mortiz

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Reply with quote  #12 

Geo,

 

Like me, it appears you've learned trading account management at the school of hard knocks.

 

The "RUT 720" comment is merely based upon my opinion there is more upside in the market due to the MCO levels many breadth and volume related data sets have achieved.  MCO thrusts following moderately oversold levels usually occur early in an upmove, thus the opinion a few more percentage points to the upside could be expected.

 

The recipe I use for unweighted averages is the same as the old Quotron "QCHA" numbers.  The price percentage change for each index component that traded for the day is calculated, then the average of all the components' percentage changes is determined.  Tom McClellan and I employ the "QCHA" indicator in an ongoing project that categorizes all issues traded on the NYSE into various groups, and it appears to have some value.

 

Therefore, I am applying the same approach to other indices, RUT being one of them, but I also must revisit each daily file prior to August 2005 and add QCHA to the file's derived data field.

 

Better get back to work...

 

Randy

 

 

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geosing

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Reply with quote  #13 

Well, it had to happen. The RUT has veered from the fractal roadmap.

 

 

After a nine week streak, RUT weekly has slowed down to consolidate. What I expected at the F-H trendline crossing is happening now. Interestingly the RUT has not made a serious lower low since the swing low pivot "I". If this is a top, then the RUT has followed the roadmap timewise, but not pricewise. The dailies show consolidation at the highs ... may be a parabolic move of 20-30 points towards a top just above 700 still remains? This will complete a 3 Drives ('M's) to the Top pattern. Time will tell. In the meantime, ER2 continues to be volatile with an ATR of 10+ (currently a paltry 8 points)... a personal ATM, if one knows to push the right buttons. Not easy though, as I know many traders with missing fingers trying to operate this ATM. Protective gear vital when dealing with this beast. 

 

Geo

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traderpaul

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Reply with quote  #14 

If you use the time frame of A to E to draw your first box. Erase your second and third boxes. Add a second box from E to Y. E to Y should be the same length as A to E......Then this will look like the second top just like the first box.....

 

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geosing

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Reply with quote  #15 

Hello Traderpaul,

 

Thanks for your comments. Yes, I agree, although this was an attempt to see if the RUT will trace out exact same pattern.  I use measured moves all the time in daytrading. Timewise targets have been met, but pricewise there is some deficit to be made up. AB leg was some 140 points. From E, the RUT has done 122 points. So a 20+ point rally is not out of the question, IMO.

 

 

RUT has been tracing out a rising wedge in the monthly. Measured move is suggesting 710 along the top line of the wedge. Internals seem to be deteriorating, as the money rotates to selected large caps - but I think it is quite possible for the RUT to make a quick blow-off move up, scaring both bulls and the bears. Monthly R1 is at 695, which is very likely to be tagged. Don't take me seriously though, as about 90% of the time I don't know what I am talking about. The other 10% I am plain wrong. That doesn't stop me from acting like I know something.

 

Geo

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