>>"The difference is that I am looking at the market as having an upward trend since Dec. 21. But I am completely removing Jan 2 and Jan 3 from my view. . . I believe they were totally contrived. The dump on Jan 2nd was, in my opinion, a set-up for the Jan. 3rd burst rally, as we've discussed. The Federal Reserve is obviously full of leaks."<<
If you took away the daily bar chart of Jan 2nd and 3rd from the overall Nasdaq historical chart, yes, you will see a minor V shape reversal without today's action. But ain't you dismissing Jan 2nd and 3rd from the chart so as to rationalize your prediction of what to come? Today's action, however, is confirming that the OVERALL trend is still down. Just pull up the Nasdaq historical chart and look at the overall trend, I still see a lot of zig-zag movement with lower low. All I can see now is that there are two bottom supports that must not be breached if the downtrend is to be halted- the low of Dec. 21 and Jan 3. If both low are breached next week, I'm afraid my broken clock prediction is that the bear is still in charge.
You mentioned a lot about market manipulation... the way I see this, the market has been subjected to manipulation since day one. Unfortunately, trying to predict which way (short or long) the manipulation is being done is as futile as trying to predict which way the stock is going to move. You can argue that there were leaks on the Fed's rate cut and Jan 2nd was a set-up day for the manipulator to buy on the cheap. Well, how about the lower low on Jan 3rd? It is hard for me to believe that the manipulator will risk getting burned by trying to push the market lower in the morning hours knowing that a rate cut is happening.
Well, how about the argument that the manipulation is being done on the other side of the mountain? That the rate cut was an excuse for the manipulators to drive up the price quickly so that they could sell their loads and shorted some more at better price?
I'm sure you can come back and rebut me with more details to support your view... but it really doesn't matter. I always work with the maxim that I'm ignorance about the market and the manipulation that "supposedly" is going on. My broken clock prediction is no better than Tom and Dick anyway. My effort will be spent on reinforcing my discipline in controlling my greed, fear, ego, and cutting my losses quickly. This way, I will force myself to let the market tells me what it is trying to do. If I couldn't figure it out, I will not trade. I'll stay on the sidelines.
In other words, the only view I believe in is that we must let the market direction tells us where it is heading. At this point, the chart is showing a lower low and a downtrend. Since I'm not trying to pick bottom, I can wait for the direction of the chart to change upward and show higher high on a consistent basis before I will say the trend is reversed.
But for now, I'll say be very careful trying to pick falling knives looking for those burst rally effect.
Good luck. |
