Futures markets

  1. 2,271 Posts.
    Thanks for your charts acouch, appreciate them.
    One day I'll take the time to knock up a website so I can share some of mine with the forum.

    Well now, didn't we see a huge rise last night in half a day's trading on the DOW!!!
    I asked myself "is this for real"? My gut feeling is "no".
    The reason for this is, "what's changed ... nothing."
    A few commentators were tipping a strong night if anything less than a terrorist attack happened on independance day.
    This has all happened before, the yanks showed huge bravado to the world after the Sep11 crash, with the market gapping upwards several times. Since then, the bear market (which is now 2 1/2 years old almost to the day) took over and subsequently filled most of those gaps.
    To post the biggest gain for the year in only half a day, and with low volume indeed looks more like a huge sigh of relief to me.
    There were no significant announcements on the economy or commodities figures to suggest anything has changed.
    The DOW has now (only daily)turned and shows a rally from a minor double bottom at around 8900, after strong "man in black" intervention at 9000 stopped the plunge. Careful guys, it's now sitting on a double top (minor) which was the high for yesterday at 9400. Also it's sitting on the upper short term trendline as pointed out by another poster.
    Time will tell, but I would doubt rises of this magnitude could be substained without significant improvements in fundamental figures, exept in the dreams of the most imaginative bulls.
    Since few that I am aware of (here) trade the DOW, lets have a look at our own futures market, the SPI200.

    The SPI made bottom from that last downward run at 3169.
    I was tempted to use double stops here and go long, as this was a major bottom, dating back to Sep22 2000. Sep22 is one of my time cycles (as well as my birthday) and has proved significant. In fact the low I spoke of was only broken on Mar23 2001, exactly 6 months (or 180 degrees) later. This date then became a double bottom a week later, then saw a rise of 309 points to the 29th June top of 2001.
    However, I prefered to risk a few points, my nerves would not allow me to be long leading into independance day celebrations. The market is now in a short term upward trend, having now formed a higher bottom and a higher top on the daily swing chart.
    I pointed out to somebody here (perhaps the mouse) at a time cycle change last Friday, from the 29th of June high. Since the 29th was on a weekend, my prediction to watch for a change was the Friday, and the bottom was actually made on the Thursday. No doubt a guy as skilled as yogi (by the way, where is the guy) would have been able to point out whether the times are running slightly ahead or behind.
    Anyway, I'm now long, (missing out a few points profit by fear of July4 on my last short trade) getting in at at 3207 (breaking of Thursday's high and confirmation of point c, with my stop under the low of Thursday (3177). This stop will be raised on Monday to 3184, a point under Friday's low. I will add to my position at a break of the previous high of the swing chart (3240) Since this is where the sycom market is sitting now (3241) I might just take a punt and wait 10 minutes into trading on Monday, as the market often gaps up but fills the gap in the first 10 minutes of volatility (ie the 10 minutes before the ASX begins trading). This may give me an opportunity to add at a better position, if I'm wrong and it continues on it's merry way I likely will not add at this point.
    This will be only my second long trade since the high or 3500 6 weeks ago, as the main trend is still well and truly down (weekly and monthly). The first long trade proved profitable, although brief, rising from a double bottom on 13th May to the double top of 17th.
    I've been stopped out several times in the meantime, only to watch the market continue on without me, 3 times turning right on my stop. However, the fact that close stops save you from any significant losses tends to more than counteract the occasional missing of a better trade.
    My longer term view is as the chart shows me, the market is continuing downwards. My lower targets will be the trendline I once spoke of that has not been broken since 1993, and included the exact turning point for the market on Sep 24.
    This is the reason that I doubt the Sep24 lows will be reached, as some others predict. However, a breaking of that trendline would be an extremely bad sign for all the poor buggers here trying to purchase stocks and make a dollar. For those who have found profitable stocks hard to find the last few months, at least the trendline is now getting close, so we may just be in for some easier times.
    Lets hope this post makes it this time, I've now typed it 3 times and had two PC freezups (so much for the stable NT platform of windoze 2000 pro!)

    Good trading all.

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