Don this little exercise has been tremendously useful to me. I think it is some of the best work we have put together here. I am honestly excited because I believe we will get both volume capitulation as we saw on October 8 1998 and a huge spike above 50 in the VIX. It will give us a highly readable bottom.
It has happened before many times in the past.
It should happen this time around when we hit bottom. We could have a day of volume perhaps fully 30% higher than the day that proceeds it. Well higher than the recent almost 2 billion shares for the NASDAQ. Perhaps more like 3 billion shares will be traded that day. We got 2.8 billion on September 20, 2001 and that does not appear to be a bottom that will hold:
chart.yahoo.com
stockcharts.com[l,a]mhclyiay[d19950101,20020622][pb50!b200!d20,2!i!f][vc60][iUb14!Uk14!Ul14!Lp14,3,3!Lf!Lc20!Lah12,26,9]&pref=G
chart.yahoo.com
A VIX reading above 60 would nail it as the turn around day.
chart.yahoo.com
stockcharts.com[l,a]mhclyiay[d19950101,20020622][pb50!b200!d20,2!i!f][vc60][iUb14!Uk14!Ul14!Lp14,3,3!Lf!Lc20!Lah12,26,9]&pref=G
Until then I'm afraid the market it will remain susceptable to selling on every rally.
RtS |
