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[parispundit]

I have decided that when I next have any money to invest, outside my retirement funds, which would be difficult to access for this purpose, I am going to go native and just invest in Paris studio apartments. As long as you have 10 years to spare, seems hard to go wrong with them, especially if you rent them yourself rather than through an agency.

My favorite curves are not found on charts.

[prytania3]

Well, I sure had it today wrong. I thought there was going to be at least a dead cat bounce for sure. The VIX is out of the Bollinger Bands to the north and the DJIA and SPX are out of the Bollinger bands to the south, and the candles were almost dojis.

Now there still has to be a dead cat bounce, but today made the charts look really bad.

[prytania3]

However, no Hindenburg Omen has been spotted (though I did put it on Google alert), and though not every Hindenburg Omen has ended in a crash, no crash has occurred without a Hindenburg Omen. People are beginning to look for it, though.

[mdwlark]

How long will the "dead cat bounce" last?  How deep and how long do you expect the C-wave down to be? 

[prytania3]

A C wave is either sideways down or a plummet into the vat. The second type of C wave is a crash, and crashes have always been preceeded by these  Hindenburg Omens, and though people have started looking out for one-it hasn't happened. Then again, there's a first time for everything. Unfortunately, I can't pull my chart up right now to see the damage.

http://www.investopedia.com/terms/h/HindenburgOmen.asp

[i_heart_bulldogs]

I'm a little concerned by your interest in technical analysis.

[mdwlark]

I'm a little concerned by your interest in technical analysis.

Who?  All of us?  Pry?  We are grownups.  We get to be interested in what we want, for whatever reasons.  I don't get your concern. 

[mad_doctor]

The market's down over 100 points today.  That's pretty significant, prytania.  What kind of selloff were you looking for?  Or, were you looking for a dead cat bounce?  

I've spent some time thinking about what's kept the market so high for so long.  I think it's the same reason people don't sell upside-down homes - they don't want to take the hit.  However, sooner or later reality will sink in and they'll either take the hit and move on or get comfortable for the long haul.  One key difference between stocks and homes is that people can sell stocks when they need cash even if the stocks have lost value, but they're reluctant to sell an upside-down home since they won't walk away with cash, and in most cases will have to pay even more cash to get out from under it.  I think a lot of investors have been paying the bills with dwindling cash reserves for the last 16 months.  When the cash runs out they'll have to start selling their stock so they can pay the bills, and sell they will - like a flood.

Perhaps these last 16 months are your missing dead cat bounce, prytania?

[prytania3]

I'm a little concerned by your interest in technical analysis.

I live by the charts.

Anyway, I'm looking at the DJIA and SPX and they look pretty much alike. The DJIA has support at around 9750, and this wave is one of two possibilities. It is either a 4th wave correction, which means it could reverse at 9750 or at the next level around 9080, and then go back up to the high 10s OR as Mad Doctor pointed out, the bull run we just had was a correction. and now we're *really* going down. I don't think we've had enough bad news for that scenario, though.

Personally, I think it's a 4th wave down and we've still got a fifth wave up, but it's really treacherous out there, and even if there is a fifth wave up it may not go any higher than 10800.

The Nikkei and the Hang Seng are down, but futures are green, so we'll see what tomorrow brings.

[prytania3]

The Elliot Wave newsletter is free today and I think tomorrow. I didn't realize they were having free week.

http://elliottwave.com/

[i_heart_bulldogs]

I'm a little concerned by your interest in technical analysis.

Who?  All of us?  Pry?  We are grownups.  We get to be interested in what we want, for whatever reasons.  I don't get your concern. 

I only care about Pry in this case, and only because of the CFA. Professional financial analysts rather look down on chartists. If you are going to be a technician and work as an analyst, gotta keep it on the down-lo.

I imagine Pry is in the top 10% of technicians who make money on it. But, that's probably because of instincts. All the research I have seen on the topic says it's all sunspots, and that only 10% (on the high side) of technicians can systematically earn abnormal returns.

[mdwlark]

I didn't mean to sound snarky.  I shouldn't post when I'm tired or in a hurry.  I'm glad all of you economists/analysts are contributing. I love picking the brains of smart people, with no consulting fees to pay!     

[i_heart_bulldogs]

No worries. I'm on low sleep with my teaching marathon still looming.... Ick-o-rama. Anyway, that combination makes me a little sensitive.

[prytania3]

I'm a little concerned by your interest in technical analysis.

Who?  All of us?  Pry?  We are grownups.  We get to be interested in what we want, for whatever reasons.  I don't get your concern. 

I only care about Pry in this case, and only because of the CFA. Professional financial analysts rather look down on chartists. If you are going to be a technician and work as an analyst, gotta keep it on the down-lo.

I imagine Pry is in the top 10% of technicians who make money on it. But, that's probably because of instincts. All the research I have seen on the topic says it's all sunspots, and that only 10% (on the high side) of technicians can systematically earn abnormal returns.

Oh, I know. My SO gives me hell about it all the time, and then says, "Look at this chart for me." Some of those behavioral hedge funds that use charts a lot do very well,  but my evidence is anecdotal.

[i_heart_bulldogs]

I'm a little concerned by your interest in technical analysis.

Who?  All of us?  Pry?  We are grownups.  We get to be interested in what we want, for whatever reasons.  I don't get your concern. 

I only care about Pry in this case, and only because of the CFA. Professional financial analysts rather look down on chartists. If you are going to be a technician and work as an analyst, gotta keep it on the down-lo.

I imagine Pry is in the top 10% of technicians who make money on it. But, that's probably because of instincts. All the research I have seen on the topic says it's all sunspots, and that only 10% (on the high side) of technicians can systematically earn abnormal returns.

Oh, I know. My SO gives me hell about it all the time, and then says, "Look at this chart for me." Some of those behavioral hedge funds that use charts a lot do very well,  but my evidence is anecdotal.

Financial economics has three deep academic divisions: the efficient marketeers, the value investors, and then the behaviorists. We all choose up sides early on and there ain't no talking to the other gangs.