But being wrong in the short term does not make me wrong in the longer term. With the high on the year still intact, stocks are right in the typical topping area for 2nd waves right now, and the fact that this rally is based on some bailout nonsense in Europe, I feel this is simply just another time for me to nibble on the short side some more. I'll get more aggressively short on a nice reversal day, or simply a sharp decline on very bearish internals. But I have little doubt this market will not make it easy on me. I just have to put my emotions in a box, lock them up, and keep them under the bed for now so I don't do anything stupid.
Free Trader's eBook Until November 7th, 2011 from EWI
Looking at the euro chart I posted yesterday it still looks great for a top and reversal and has me salivating to get short. Then when I look at the above chart from this morning, I think I'm an idiot for wanting to get short. But that's the market. Right around major reversals in likes to suck you in and then slap you, making you feel stupid in front of your friends. And this slap hurt, I tried twice to short this pair yesterday and got stopped out twice. I'm waiting now for another reversal sign and will try again. I'm not giving up simply because I was wrong yesterday. Being wrong is part of trading. It will happen, and happen often. The key is to adhere to the bottom line we all have, which is to make money trading. Well, that's what I plan to do.....make money shorting the euro. Yesterday's decline looks like a 4th wave and the 5 wave rise into this morning looks like a 5th wave at some degree. I'm not sure if it will subdivide further into 4th and 5th waves so I'm going to wait for now. The top in the euro should align with stocks more or less.
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PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.
12 comments:
Hi Todd,
good work as usual :-)
No need to feel stupid. I shorted Gold and EURUSD. Looking back it gets more and more clear, that it was wishful thinking. But that is after the fact....
Putting the whole impulse from 314x into a base channel gives room for 4240 to 430x. We will see........
Best to you,
Markus (infinitus)
Enjoy your work! Thanks
Friday, the SP appeared to be consolidating above the 200 day SMA of 1274. This is very bullish, IMO. I think it's time to consider much more bullish counts, like a PB wave flat challenging highs of the year, or the possibility that this rally is part of a new bull run to new highs.
Thanks for the pat on the back Markus :-)
Thank you!
Certainly valid. But since I weight the majority of my analysis on EWP, the five wave drop from the high on the year cannot be ignored and suggests nothing bullish at all until that high is broken.
Regards,
Todd
There is only one problem with that theory, it's wrong. Nicely LOL
The 5 wave drop from 1371 can be considered Primary A of a 3 wave zig zag correction. Primary B could be finished at 1292 and Primary C could move to make a low below 1075.
Instead of discounting my theory, why don't you propose your own?
It was meant to be funny,
Just when everyone is looking for an excuse to be bullish, that is when lucy pulls the football away from Charlie Brown, and this
http://oahutrading.blogspot.com/2011/10/cable-on-important-channel-line-swat.html#disqus_thread
Interesting take. And it will be hard to distinguish Primary wave C from Intermediate wave (3) since both are 3rd waves and are often accompanied with similar internal strength. So if you have this as a Primary ABC correction, what's your Intermediate wave lable for the move.....4th wave?
On a Cycle scale, C2. On a major scale, either major C of primary C finished at 1292+ or has one more push up towards the 78% fib around 1310.
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