Zeev,
I was on vacation last week and part of this week,
so trying to catch up with various things.
My understanding is that your target intraday bottom
for the Nasdaq is "1326 or below", meaning a drop of
AT LEAST 114 points (8%) intraday from today's close
of 1440.
My question is what is the probability, according to
your turnips' current perspective, of it being lower,
and by how much?
Regarding the Dow, you said, "I have a target low for
the year of 7500 to 8000".
Looking at the 5-year Nasdaq chart:
bigcharts.marketwatch.com
I see a lot of symmetry.
I remember in late 1999 reading that charts often fall
symmetrically to their rise, but didn't believe that it
could happen to the Nasdaq. Here we are below 1500 and
it is almost a bell-shaped curve!
Looking at the 5-year Dow chart:
bigcharts.marketwatch.com
It looks like a 10-headed monster with the right shoulder
too high. The left shoulder neckline is around 7500 and
the right shoulder neckline is around 8000, presumably
giving the range that your turnips have for their target.
In the last 2-3 weeks, the Dow has made about half the
drop to your target, but this still leaves a drop of
13 to 19 percent!
Might this happen BEFORE the summer rally?
If so, wouldn't the Nasdaq fall more than just 8%,
especially considering that it is a Nassacre and
not a Dowacre???
The Nasdaq seems to move roughly 40 points for each
point move in the QQQ. For grins, I put together the
following table of target bottoms for this drop with
swags for the probability of each.
Nasdaq QQQ Probability
------ --- -----------
1440 26 100 %
1400 25 90 %
1360 24 75 %
1320 23 60 %
1280 22 40 %
1240 21 20 %
1200 20 10 %
< 1200 < 20 < 5 %
Obviously this is just a swag, but since we breached
1440/26 today, that is 100%.
I gave your turnips a 60% likelihood of being right
with their 1326 (QQQ ~23) target.
And I think anything less than 20 on QQQ or 1200 on Naz
is very unlikely.
The other numbers were interpolated from these three
points using the "GTC Trader Smoothing Coefficient" (swag).
I am not so good at recognizing the whites of the MM's
eyes, so I will be watching you and the market as time
allows, but do you think the above expectations are
reasonable at this point in time?
All comments would be greatly appreciated (except from
Mark Johnson and the new stalkers on this thread).
Thanks, and have a great weekend!
Next week should be interesting!
Your adoring lapdog <GGG> - Ken |
