Dow 2008

[Chocolate]

What would you make of price action that spent most of the day grinding higher followed by sharp drops before the close. We've had 3 days in the last 4 a bit like that and I'm wondering about its significance. Does it shake out buyers or shorters? And thus is it consolidation before an up-leg or a down-leg? Maybe it will be different this time from what you'd expect, but I'm really not sure either way what to expect, so it's got me pondering. :^)

 

[firewalker99]

What would you make of price action that spent most of the day grinding higher followed by sharp drops before the close. We've had 3 days in the last 4 a bit like that and I'm wondering about its significance. Does it shake out buyers or shorters? And thus is it consolidation before an up-leg or a down-leg? Maybe it will be different this time from what you'd expect, but I'm really not sure either way what to expect, so it's got me pondering. :^)

The sharp drop in all of these cases was caused by price failing to break resistance.
It is remarkable that the volume today was much higher than yesterday though. A lot of contracts have been changing hands... I'm sure we'll now more by tomorrow night

 

[Devilicus]

Going for a short here at 12870 (actually trading the spx but that's the current price of my DOW cash)

A little wary as the daily chart looks like it has the potential to break to the upside to me, looking at a possible 500 point move up. Never the less, im just playing in the short term looking for a dip on monday.

Stop of about 60 pips on this trade.

Happy weekend all.

Am closing this here at 12802 for 68 pips profit.

Wanna see what happens tomorrow. If I want to get short again I think i can get a better price tomorrow than where we are now.

 

[fibonelli]

What would you make of price action that spent most of the day grinding higher followed by sharp drops before the close. We've had 3 days in the last 4 a bit like that and I'm wondering about its significance. Does it shake out buyers or shorters? And thus is it consolidation before an up-leg or a down-leg? Maybe it will be different this time from what you'd expect, but I'm really not sure either way what to expect, so it's got me pondering. :^)

Insiders selling. Intrinsically bearish.

 

[firewalker99]

Insiders selling. Intrinsically bearish.

I'm with you... although most of the selling has already taken place before this imo.

 

[black bear]

"Insiders selling. Intrinsically bearish."

Insiders wanting you to think they are selling. Intrinsically Bullish.

 

[firewalker99]

"Insiders selling. Intrinsically bearish."

Insiders wanting you to think they are selling. Intrinsically Bullish.

:cheesy:

 

[Atilla]

Hi guys,

Looking at this first chart it's a 50/50 call. The long term uptrend here has clearly been broken imo.

However, the chart is at a cross point where imo previous support becomes resistance at 13000.

Will the DOW break above? or Will it continue in it's new down trend?

IMO we can't tell based on this TA chart. It's purely a 50/50 call.

At times like this I think indicators are very valuable to confirm and verify price movement. Thus all of mine are indicating a rise. MACD, RSI, Stochastics, Pivot Points.

Price has also moved above moving average DEMA21 & DEMA34 and just shy of DEMA55.

So I reckon we still have some movement to the upside in the system. Pivot points R2 show 13052.

It's difficult for me to explain or argue further rises but in the absence of news and my inherent fundamental bias to the downside this is what TA is showing.

I have been watching the rise and scalping with shorts.

More small rises are a possibility but I'm still expecting a big long swing down. I'll change my opinion if we go well above 13000 and beyond.

Interesting times. Good trading everyone. :whistling

 

[Vaco]

I agree with Attilla and think we are more in consolidation then a downturn at the moment, price is excatly where it was at the start of the month and on the weekly charts we have had higher highs and higher lows for several weeks now. Historically 12800 seems to be a more significant support/resistance no then 13000 so as long as we stay above that we should see a break to the upside. Failing that i think we will see a bounce betwen 12000 and 12800 a few more times before we go any lower.

By the way nice charts Atilla, who do you trade with?

 

[Atilla]

Thanks firewalker99 you sound like you know a lot about the Dow. I wish I was as good as you. Just one more question. Why is the Dow at a record level when all you here in the news is how bad the world economy is? I don’t get it.

Thanks

What is your first question? :cheesy:

 

[ian]

Why is the Dow at a record level when all you here in the news is how bad the world economy is? I don’t get it.

Thanks

If you are a trader then it represents opportunity, just remember to keep well hidden in the long grass! ...if you are an investor...well.....

 

[Atilla]

My question is. Why is the Dow at a record level when all you here in the news is how bad the world economy is? I don’t get it.

DOW is not at record level it's come off the 14000s already...

You are pretty mixed up with your facts. Attention to detail is a requirement...

You are mis-reading and mis-quoting.

Take care.

 

[firewalker99]

My question is. Why is the Dow at a record level when all you here in the news is how bad the world economy is? I don’t get it.

How can the Dow be up so high?

First of all, if you want to start the same old bs like your previous incarnation - and don't pretend like you don't know what I'm talking about - I personally guarantee you it will not last long before you're out again.

Second of all, whoever keeps track of the news to interpret the markets is not one step, but two steps behind. At the time the news comes out, everything has already long been calculated in the price.

Wyckoff said:

You need never read anything on the financial page of your newspaper except the table of stock prices and volumes.

You need pay no attention to the news, earnings, dividend rates or statements of corporations.

You need never study the financial or the business situation.

You need not understand railroad or industrial statistics, the money market, the crop situation, the bank statements, foreign trade or the political situation.

You can absolutely ignore all the thousands of tips, rumors, reports and especially the so-called inside information that flood Wall Street.

You can discard all of these completely and finally.

 

[firewalker99]

So what you are saying then that if the world economy collapses in American then the Dow will be two steps behind maybe several months. You say above in your post that news is factored into the market and then say don’t listen to the news.

No, I said the markets are AHEAD of the news. The markets stopped rising and the smart money is usually distributing before bad news comes out. Look at bear markets from the past. Look at when the financial crises came out to the public. By that time the markets already told you all you needed to know. When a new bull market started around the end of 2002, beginning 2003, everyone was still very pessimistic and there was no good news at all. By the time good news finally comes out, the markets have already gone up significantly.

But I thought the news of the economy moves the Dow. Sorry I must be wrong.

News moves the markets, but not in the way most people think.

I humbly step down from my delusional thoughts.

If only that were true.

What you are saying above then is that the stock markets move in a pure technical and mathematical way.

Ah, I knew it wouldn't last long. Here's the word "mathematical". I hope for your sake your next post does not contain the F-word..

And who is James/BAT/HG? I have never heard of him. I am just trying to learn about the stock markets and how they work. I am a Rookie.

Then I suggest you ask your questions in the First Steps forum and not here. For someone who claims he's a rookie, he sure found this thread very fast.

 

[black bear]

Who cares what moves it so long as it keeps moving

 

[wasp]

Don't feed the troll FW

 

[black bear]

Halfords

This is all very confusing for a beginner. You said above: No, I said the markets are AHEAD of the news.

So what you are saying is that the markets move before any news is released. How can this be the case? Do traders have indicators that tell them the future? That’s a brilliant idea. Where can I buy such an indicator?

From Halfords

Ask the manager, think they are on special offer this week

 

[firewalker99]

From Halfords

Ask the manager, think they are on special offer this week

Wal-mart is cheaper :cheesy:

 

[firewalker99]

lol, paying the ask again

The could be out of though. Look at what's happening to rice over there.

Meanwhile we've dipped below 12800 on the DOW.
So far so good

Look at the pattern pre-market. It's like a bouncing ball that runs out of energy.

 

[KTF]

Just hope the fed don't intercept and throw a 3 pointer....