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Tuesday, April 6, 2010

A little secret unveiled from Gann? - the best trader ever probably

It might not sound very spectacular but as soon as you have a glance on the charts you might get an idea. Gann says that things repeat in 100 year and 1000 year terms not only referring to stockmarkets as back than we did not have stocks but definetely we had greed and some sort of speculation in commodities. Going back for only 100 years we have some amazing parallels we had the panic of 07 (sounds familiar) and a steep rally which pretty much the same character. Back then the rally lasted 2 years or 23 months fairly the same amount it took to come down (22 months). This time the decline lasted 17 months was a little bit steeper though and we have reached month 13 of the rally which is about the time a corrective move starts in almost all cases even on temp basis. After all 1910 was a down year and we are heading for a severe correction the question is will the big leg start now or is a final leg up due after the imminent correction starting in April. Well from an astrological perspective the real negative pattern is due around Q3 and we have some positive aspects due in late May into June which basically confirms a correction for now followed by another spike and August has already very negative patterns. We have to figure out as we go along as sentiment numbers are good co-indicators to figure it out. For now get ready for a decline starting this or next week. The time line the article below or rather the chart indicates will not be relevant fo todays markets as some facts differ as the length of the waves hence it will rather not be March 2011 but as described above August 2010 (17 months as well ).

excerpt

CHART OF THE DAY: ANOTHER PANIC AHEAD?

Good stuff here from The Big Picture blog and the Chart Store. The current market rally is following the market action during the Panic of 1907 to an eerie extent. If the current environment were to closely follow that environment we would likely be in store for a near-term 10% rally before capping the final leg of the bull move higher. Ultimately, the market rallied 90% from the bottom before the wheels came off again and the market fell nearly 30% over the following 18 months. This is an obvious case of data-mining, but as Barry says, it’s also an interesting study in how psychology often rhymes:

panic07 CHART OF THE DAY: ANOTHER PANIC AHEAD?

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