Archive for November, 2012

alphabetagammazeta…….

Posted on Nov 24, 2012 by .

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http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=6&dy=0&id=p55455624798&a=266398464

Of musical interest, Brazilian artist Carlinhos Brown’s album, Alphabetagammizado is one of the great classics of drumming and  infectious rhythms.  Stocks have rhythms too, and here, lethargic with turkey and cranberries, we see that old island Friday displaying the holiday phenomenon, the sneak attack by the traders who didn’t go to the Hamptons or Bermuda for the holiday.

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Mood change.

Posted on Nov 19, 2012 by .

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http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=6&dy=0&id=p18894193176&a=214966864

The market has been clearly oversold lately, so contrarians, short sellers and mischief makers, each trying desperately to get a seat before the music ended, drove the market up over a percent in the first two minutes of trading, and then the slow movers drove it even higher.  While explosions like this often result in the initiation of trends it is for certain that they initiate trades.  so we initiated some trades.  Bought the silver; the Qs; the TBT (short TLT); took off part of our hedge on the SPX (SPXU) (at a profit).

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Correcting the analysis…

Posted on Nov 15, 2012 by .

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http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=6&dy=0&id=p18894193176&a=214966864

Now, this is what happens when you rely on your memory in making an analysis.  You make mistakes.  We made mistakes in the application of the rule of seven in our previous letters.  Then something someone said made us go back and check Sklarew —

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First rule of seven target hit.

Posted on Nov 14, 2012 by .

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http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=6&dy=0&id=p18894193176&a=214966864

We remarked, when the new high stop was tripped, some days ago, that scaling in to a hedge was not a bad idea.  That was a good idea.  The downwave, continuing, has now taken out the first target of the rule of seven.  More hedging might be in order.  And — if you told yourself that you would exit or hedge when the new high stop was hit you better have done that, or your immortal soul is in danger.  It is the devil who tempts us to change our stops or procedures when the market is going to hell.

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More targets…more targets than a pincushion…

Posted on Nov 12, 2012 by .

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http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=0&mn=6&dy=0&id=p18894193176&a=214966864

As we have previously noted, the forrmation from early September to late October has a toppy aspect.   We measured the depth and came up with 77 points, subtracted from the bottom, 1397, gives us a potential target of 1320.  We have marked it on the chart.

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