The Mother of All Bull Traps?

19 posts / 0 new
Last post
Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
The Mother of All Bull Traps?

Sorry guys, I disappeared again, Just having continual bad luck with some surgical issues but don't worry, I'm getting back to 55-70%. LOL

For you folks that sent me PM's, I have not been ignoring you. I'll answer them as soon as possible. 

----------------------------------------------------------------------------------------------------------------------------------------------

Anyways, I sent this to Chris but I thought that I'd post it publicly for feedback. 

It appears to me that it is possible that with last weeks vapor volume rally, that we are potentially looking at the mother of all bull traps. 

For you folks versed in technical analysis, I invite you to comment and criticize my point here. But I found this just too creepy to ignore. 

Disclaimer: I am a retail investor by hobby and NOT a professional investment advisor/ money manager. This is for informational purposes and discussion only. Consult a professional advisor before making any investment decisions. 

Disclosure: Long DXD, SDS, Gold, GLL. Short LQD. 

 

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
Oops. I think this is in the

Oops. I think this is in the wrong forum. Moderators, would you please move this to the US Markets forum please? 

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
Oops. I think this is in the

Double post

JAG's picture
JAG
Status: Diamond Member (Offline)
Joined: Oct 26 2008
Posts: 2492
Hey Morph

Hey Pete,

Glad to see you back....so regarding the chart that you posted, is it the low volume associated with the right shoulder formation that portends a coming crash? Other than market sentiment analysis, I don't do much technical analysis....thanks.

Jeff

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
JAG wrote: Hey Pete, Glad to
JAG wrote:

Hey Pete,

Glad to see you back....so regarding the chart that you posted, is it the low volume associated with the right shoulder formation that portends a coming crash? Other than market sentiment analysis, I don't do much technical analysis....thanks.

Jeff

Thanks Jeff. It's been a hell of a few months. Next up, knee surgery. When it rains it pours. 

Low volume on the R shoulder suggests that the third attempt to "rally the market up" has completely lost steam. This isn't confirmed yet but today was a very low volume slight down day. The next few days or perhaps two weeks or so will demonstrate if this is a R shoulder pattern. That red line is called the neckline and for us chartists (actually I'm a hybrid, fundementals/technicals, I use them both equally) would be either bullish exit or a short entry position. 

I'm asking the technical analysts here if they also concur that this is a "watch pattern" or a potential "yellow alert" so to speak. 

Tell you what, this thing goes down and I'm guessing a nasty deflationary deleveraging event will wake everbody the heck up. 

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
 Wow. I was right. 

 Wow. I was right. 

joemanc's picture
joemanc
Status: Martenson Brigade Member (Offline)
Joined: Aug 16 2008
Posts: 834
Morpheus wrote:  Wow. I was
Morpheus wrote:

 Wow. I was right. 

Yes you were! Holy market capitulation batman! Shades of 2008...at least gold is still up

Wendy S. Delmater's picture
Wendy S. Delmater
Status: Diamond Member (Offline)
Joined: Dec 13 2009
Posts: 1982
DOW's down over 300 pts at noon

Yep. This is not a happy market, people.

Dogs_In_A_Pile's picture
Dogs_In_A_Pile
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2606
Life Is Good
joemanc wrote:
Morpheus wrote:

 Wow. I was right. 

Yes you were! Holy market capitulation batman! Shades of 2008...at least gold is still up

Indeed, so nice to be in Puts last Thursday........

Take a chunk and move on.

SagerXX's picture
SagerXX
Status: Diamond Member (Offline)
Joined: Feb 11 2009
Posts: 2219
Gold plummeting now...

Down more than 30/oz from the highs to 1652. It will be interesting to see if buyers step in to BTFD, or if this is a margin-call-type liquidation. Interesting times... Viva-- Sager

Doug's picture
Doug
Status: Diamond Member (Offline)
Joined: Oct 1 2008
Posts: 3125
PMs?
Quote:

...at least gold is still up

Until now.

Quote:
Jim Wyckoff Comex Gold Backs Off Record High on Profit-Taking Pressure

04 August 2011, 11:56 a.m.
By Jim Wyckoff
Of Kitco News
http://www.kitco.com/

(Kitco News) - Comex December gold futures prices have backed down from the record high of $1,684.90 scored in earlier trading Thursday. In a wild day in the market place, gold traders are deciding to ring the cash register and book some profits following recent strong gains. Virtually all other commodity markets are selling off Thursday, led by crude oil, and that is also weighing on gold. The corrective pullback in gold is not surprising, as the market had just become technically overdone on the upside, on a near-term basis. Gold market bulls remain in overall full technical command. December gold last traded down $1.30 an ounce at $1,665.00.

By Jim Wyckoff of Kitco News; [email protected]

Does this ring true or is something else going on?  Gold down more than $17 and silver down more than $2.50 as I write.

Doug

gregroberts's picture
gregroberts
Status: Diamond Member (Offline)
Joined: Oct 6 2008
Posts: 1024
It's impossible to predict human action

By the end of the 1970s Harry had come to the conclusion that forecasts were pretty useless.

He said, "If the world is running out of trees, it is because so many people have used so much paper to write so many words about so many inevitable events that never came to pass."

In March 1980, he wrote "Forecasting vs. Strategy," in which he said that profits come from a good strategy, rather than accurate forecasts. And as the decades progressed he became progressively more anti-prediction. And he published many full-length articles explaining why it's impossible to predict human action - no matter how simple it may seem.

This book contains 16 of those articles that discuss Harry's investment strategy. They contain perceptive explanations that debunk so much of what passes for investment wisdom - plus intelligent comments about life. Most of all, the main thrust of the articles is a step-by-step analysis of how you can deal with an uncertain world - without preconceptions or dogma.

These articles will remind you of something you learned a long time ago - that the future is unknowable. They will also reassure you that you don't have to rely on fortune tellers to deal successfully with any part of you life -- including your investments. And they're written in Harry's patented easy-to-follow style, sprinkled with his good humor.

http://www.trendsaction.com/product.php?product=Investment+Strategy+in+an+Uncertain+World&ulaCartSID=xzLvnPkQIpgzvKgbguOXXxegY1312479379

 

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
 Don't wholly agree with

 Don't wholly agree with that Greg. A head and shoulders formation can be a self fulfilling prophesy. Particularly on that vapor volume runup on the second shoulder. It appeared at the time as the holy grail of bear signals. Turned out to be just that. If traders see that, and I am sure they did, then all they needed was some crappy news to run for the exits. 

gregroberts's picture
gregroberts
Status: Diamond Member (Offline)
Joined: Oct 6 2008
Posts: 1024
Don't wholly agree with that

Don't wholly agree with that Greg.

As Morpheus would say, "My beliefs don't require you to". ;-) couldn't resist

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
 Greg, I'm saying this.

 Greg, I'm saying this. Technical analysis has been used all over the world in the markets for 75 years. Even the big institutions use it. So a head and shoulders pattern that pops up on the chart is a definitely noticed by most traders and institutions. So there's a huge self fulfilling prophesy aspect to this. The market sees that and other technical warning signs and then when some adverse situation (Europe, IMS) pops up, the sell off begins and is exacerbated by the pre-existent expectations derived from the charts. 

THAT does have a non random probability to it as witnessed by the past two weeks. 

xraymike79's picture
xraymike79
Status: Diamond Member (Offline)
Joined: Aug 24 2008
Posts: 2040
 I've gotten equally good

 I've gotten equally good results by consulting a fortune teller/palm reader. 

Damnthematrix's picture
Damnthematrix
Status: Diamond Member (Offline)
Joined: Aug 10 2008
Posts: 3998
took the words straight out my mouth...
xraymike79 wrote:

 I've gotten equally good results by consulting a fortune teller/palm reader. 

Yep...  I was just thinking "good luck to anyone who can make sense of that chart" when I read your comment Mike....

If you're still in the share market....  you deserve everything coming to you!

Mike

Morpheus's picture
Morpheus
Status: Diamond Member (Offline)
Joined: Dec 27 2008
Posts: 1200
xraymike79 wrote:  I've
xraymike79 wrote:

 I've gotten equally good results by consulting a fortune teller/palm reader. 

It appears to me that you trivialize that which you do not understand. Let's face it. If you don't understand it, then you have no standing commenting on it, right? I made not percentages, but multiples on my trades using that very analysis. I did underestimate the speed of decline which really through me. Otherwise I could have done better. I'm betting that you supernatural medium can't outperform that.

In an era when the entire rigged game is on the verge of implosion, you get your chips when you can, where you can, as long as you play by the rules. 

Spare me the snide and condescending comment. 

Dogs_In_A_Pile's picture
Dogs_In_A_Pile
Status: Martenson Brigade Member (Offline)
Joined: Jan 4 2009
Posts: 2606
The market isn't a system, Neo.
Morpheus wrote:
xraymike79 wrote:

 I've gotten equally good results by consulting a fortune teller/palm reader. 

It appears to me that you trivialize that which you do not understand. Let's face it. If you don't understand it, then you have no standing commenting on it, right? I made not percentages, but multiples on my trades using that very analysis. I did underestimate the speed of decline which really through me. Otherwise I could have done better. I'm betting that you supernatural medium can't outperform that.

In an era when the entire rigged game is on the verge of implosion, you get your chips when you can, where you can, as long as you play by the rules. 

Spare me the snide and condescending comment. 

+1 Pete.

The market didn't close in 1929 and it's not going to close now.....

Those who can, do.

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Login or Register to post comments