Archive for July, 2013

Tiptoeing along the razor’s edge…

Posted on Jul 28, 2013 by .



After 22 days and and 8% wave prices have reacted across the wavelet trendline.  As we have often pointed out it is the length of the trendline which is important.  In this case a broken 22 day trendline would not portend much grief.  But we never say never.  What is going on at the moment is prices are meeting news resistance and the old high resistance.  This is completely natural after an 8% wavelet.

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Silver…gold…short squeeze?

Posted on Jul 23, 2013 by .



Silver gapped across the downtrend line.  A clear signal.  Note that even clear signals don’t always result in profitable trades.  On the other hand trades made without signals are much more likely to be losers.  Market rumor has it that the hedge funds are squeezing shorts.  Not known if these are boxers or jockeys.  We laid down a small unit bet on silver.  As we did with gold which has  a similar chart.

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Dow reconfirmation, SPX 1940…what’s not to like…

Posted on Jul 20, 2013 by .


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The PnF method, finding a breakout on the 11th, computes a price target of 1940 for the SPX.   Jack Schannep, the eminent Dow Theory analyst noted this week that the Transportations had confirmed the Industrials at new highs, thus clearing the way for a fully invested portfolio.  The question is not whether you believe this, but  whether you have confidence in it.  We do.

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Open season on stocks and ETFs…

Posted on Jul 14, 2013 by .




So many issues have broken out that it is difficult to track them all.  Looks like the running of the bulls.  IWM is in the clear here.  And so are the Qs:

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Power bar to new high…bad country for bears…

Posted on Jul 12, 2013 by .



Often it is not just what happens, but how it happens.  Yesterday prices powered up on a distinctive power bar to close at a new high.  New highs make many investors nervous — and afraid to buy or increase their commitments.  But pros know that prices at new highs represent prices with no defined resistance overhead.  We are great believers in adding on to commitments.  In long trends it hypos performance, and is IN FACT the least risky time to be all in.  The probability of loss is reduced when you ride with the long trend.  MPT (cooked up in an academic lab) didn’t (and doesn’t) know anything about trend analysis.

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