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geosing

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Reply with quote  #1 

This ML Set on YM has been describing the price action rather well. I have been using this to guide me in position sizing and directional selection of day trades (among other things).



When ML passes through congestion areas, it tends to follow and forecast price action rather well. It appears that the target area is near and downside risks are diminishing. Also the market is now ripe for some short covering rallies followed by test of the lows and marginal new lows. This may result in rally that approaches the ML and then a lower volume sell-off to the lower MLH (in an ideal trading world). Measured Move target has been met, so the next level is on deck which is also the target of lower MLH.

Dunnigan One Way system (DOW) has been short and is still short awaiting Preliminary Buy Signal - not any time soon at this point, it looks like. March corn has CPR after a nice rally and bears watching for a prelim. sell signal.

I got lucky in my trading this year (unlike the last) and if I don't mess up during the next 10 days, I intend to stop intensive trading at the end of this month. Trade less and study more and perhaps post some drivel here, which I don't do when I have not made my objective for the year.


Geo



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geosing

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Reply with quote  #2 
10% discount from last OE Close is 12195 (YM). I see TPOs building 12120 area, which is also the POC. Not so good for a rally, but possible close near 12195. Or for more fun during the weekend, they may close the cash Dow below 12000. As Da_Cheif would put it: three days of fear for the price of one. If the aim is to make sure every 2007 long holder is under water, the situation is pretty close in most indices here. But ... amazing price acceptance at the lows. Where is the initiative buying?

Geo
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geosing

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Reply with quote  #3 
I think they voted for LOD close, evidenced by the Dow being taken down, while other indices are following reluctantly. After all the Dow is the trigger for emotion and proxy for the market. Still close at 12195 region won't surprise me. Only 10 minutes are needed to do that job.

Geo
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geosing

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Reply with quote  #4 
Lame close - below the POC to keep traders (mainly me) guessing. Below is the DJIA daily with the same ML set as for the YM above.



AB=CD projects to 11750 on or around 1/23/08, if CD is the same time-wise as AB.  So far it has been very orderly market rallying to previous POC and range extension downwards. So a panic day is possible, perhaps replicating the 8/16/07 500+ range hammer day. Weekly S1 is 11792. April 2006 Swing High 11709. All these numbers seem to be painting for 12000 to be broken at least on an intraday basis.

May be the FED announces 100 basis points cut of something or another on Tuesday to fuel the much expected, but conspicuously absent short covering rally. Perhaps that is what some of the long holders are hoping for. I have been selling rallies since the break on the Bhutto news. (Inability of the market to quickly retrace that break was a tell, meaning selling was probably initiated by longer term participants). Slowly forgetting how to trade on the long side.

Geo


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geosing

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Reply with quote  #5 
Very critical condition the market is in. I was looking for some bullish overtones in my market profile studies. It would have been very helpful if the longer time frame bulls had stepped in and created a buying tail signifying rejection of the low prices. But TPOs kept piling on, basically implying continued selling being absorbed either by shorter time frame bears or small size dip buyers. The 'b' formation is generally a sign that market may move towards balance or reversal of trend. With acceptance of price at the Friday lows, I have to think that market will rotate downwards to find buyers in the next session. Median Lines support this idea too. Here is the Friday YM profile (top truncated).



The profile was similar on Wednesday. Thursday saw a range extension downwards with selling tail. One can sell 12110 area or the break of Friday lows and watch for price rejection at lower levels. A gap up may not reach beyond the UVA at 12200 (probably gets stopped at the Pivot Point 12180). Price rejection single prints there will also be a sell. Gap down and trading above close/POC can probably be bought.

Profile structure is such that if 12650 is tagged, 12770 will come fast. But what will take the market to 12650? Likely scenario for a big range hammer on Tuesday to avoid a waterfall decline. There will be some alibi, if this is in the cards.


Geo



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geosing

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Reply with quote  #6 
The 75 basis points cut did not deter the sellers. No knee jerk rush to cover.

Geo
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geosing

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Reply with quote  #7 
Well, mission accomplished.

Lower MLH and targets tagged. Nice hammer showing some buying. Expectation is for a try for the ML again, if this ML set still has the right frequency. The ML is falling at the rate of about 50 points a day. So if there is a continuation to this rally, it should reach that target pretty quickly- say 12350 before a retest of the Lower MLH. Kind of looks like it will complete the picture.

Tentatively the last three major pivots produce a sideways ML Set which puts the resistance at the mid point coil B-C. Premature for thinking about that till we see the next minor swing.

Not much volatility today after the open, although trading short term was difficulty because of the fast moves in both directions.

Geo


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geosing

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Reply with quote  #8 
Another profitable day puts me over my usual annual target. Time to look at the market from a distance. My thanks to Fib for the education on internals. Although I am still totally mystified by the nuances of MCO and McSum, intra-day breadth has been a very valuable addition to my trading toolkit.

Have a great time - in trading and in life. It is good to remember that you came with nothing. Whatever you have now, you are in profit. Enjoy it because you have to leave it all behind.

Geo 
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hiker

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Reply with quote  #9 
happy trails, Geo -

a short quote from a book I am now reading:

May you find grace as you surrender to life.
May you find happiness, as you stop seeking it.



__________________

Being honest may not get you a lot of friends, but it'll always get you the right ones. - John Lennon

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geosing

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Reply with quote  #10 
Quote:
Originally Posted by hiker

May you find grace as you surrender to life.
May you find happiness, as you stop seeking it.


I believe that it is hard, even impossible, to "find" happiness, whether you run around seeking it or stop the same. Happiness is the true nature of the being - unfortunately experienced only by the child and by the truly enlightened. Acceptance will get the rest of us to occasionally glimpse what is already within our Selves.

And yes, Grace happens as you surrender, another word for acceptance.

Be well.

-Geo
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