Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: J.T. who wrote (16601)	3/24/2003 11:03:22 AM
From: Paul Shread	Read Replies (2) \| Respond to of 19219

I was thinking about that; here's a quote from Desmond's paper: "It usually takes time, and significantly lower prices, for investor psychology to reach the panic stage. Therefore, a 90% Downside Day that occurs quickly after a market high is most commonly associated with a short term market correction, although there are some notable exceptions in the record. This is also true for a single 90% Downside Day (not part of a series) that is triggered by a surprise news announcement." mta.org If you look at the January 1974 data, a notable failure of the 90/90 system was signaled like this - with a 90% downside day a week after a 90% upside day. However, the market went on to higher highs after that 90% downside day (I think). I guess you also have to ask why the market rallied (let's face it, we all guess but rarely know the real reason unless it's exceptionally good or bad news). But if we rallied on the assumption that the war would be flawless, do we sell off now that it's clear it's not? And why did we rally in the first place? Was war going to boost the economy, or was the uncertainty restraining the economy? If so, it could take longer for that to become clearer. All offered with a "WTHDIK." I'll post Desmond's comments if I see them (and if this turns out to be a 90% downside day - still 5 hours to go).