Mr. Guitar.
I do not think there is anything really "known" about this subject. What I am seeing is many different people pursuing many courses of study that seem actually to be describing the same thing (Prechter, of course, Sornette, and Buckminister Fuller, among them). Many people in a dark room describing an elephant by feel, if you know what I mean ("No! It's a tree trunk!" "No! It's a hose!")
The lines are made by trial and error. Over the last year (since October of '02)I have been trying to figure out what they do mean, and have an enormous record of my observations (spider-webs). Quite frankly, have been asking your questions, myself. As far as I can figure, there is an actual structure going on here. But I really do not know.
Without a service like StockCharts, it is likely that no one would take the time or even noticed them and certainly without that service, I would not have been able to keep track of such things as they change, emerge or retreat, over time. Most have noticed the diamond angle or pattern. Peter Robinson, on StockCharts public page, has been following the same thing on the SPX... there are many others.
The orange dashed lines have been on this fifteen minute chart since the end of November, when they first showed their faces in a way that was useful to me. I suspect they have been part of the directive angle up all this time, but have became more apparent as we made this last big push above the 10,673 over 10,700 (hinting of higher levels to come). They may correspond to the larger channel lines on the weekly that I posted earlier forming the up-channel that we are in... (goodness this stuff is hard to talk about accurately!)
The solid blue lines are more recent, having just emerged with our getting to this "top" and are part of a wedge, the top of which is formed by the huge center Fib (more or less) on this chart, and the previous weekly:
stockcharts.com[g,a]whclyyay[d19961122,20041222][pf][vc60][iur14!ub14!la12,26,9!ll14][J22783112,Y]&pref=G
The weekly allowed me to call this wedge last December - much to my own surprise.
This "Fib center" looks like it is also just above old S/R, as I am sure you know formerly at 10,673, also visible on this mega-sized chart (which makes some interesting predictions of its own, specifically that we could hit the 15K level after another pullback around the 11,750-ish:
stockcharts.com[g,a]whclyyay[d19961122,20041231][pf][vc60][ila12,26,9][J21109428,Y]&pref=G
On the smaller weekly, the origin of the solid blue lines, and perhaps why they emerged just now, is shown as part of a much older structure. On the 15 minute the solid blues are the very long term, the dashed orange are our current channel lines, the dashed purple are our medium term downtrend lines. The red downtrend are long-term and apparently structural as that angle is always present, and the green are becoming more pronounced.
stockcharts.com[e,a]mhclyyay[p][vc60][iub14!ul14!la12,26,9!li14,3][J13437403,Y]&pref=G
Maybe we hit turns because the availability of the planes within the structure, itself, changes as we move through it. Certainly a line is more like a plane from what I have seen, and the influence of plane upon plane seems to describe the probable moves of the market over time. Just some (very hard to communicate)ideas....
The dashed purple lines only emerged with this last down, becoming very clear in this last two weeks, hinting of our current down. The red solids are a parallel adjustment of what until now were the wedge corrections we have been doing all along and were a flag to me that things had changed. We are not doing wedge corrections (right now). If we were the green parallels would be the right side of a wedge, the left being formed by the red downs. A change to parallel from wedge or the reverse would be the issue to look at, and if I see a wedge formed by a red green line I would think "back to the ABC wedge repeat of the autumn" and look for another big move up - which is exactly what I am expecting.
The entire structure is "caught" in the blue solid lines right now and I suspect that once we hit the lower channel lines (the medium term limit to this down) this next move up will be enormous.
There is little more I can do by way of explanation, beyond what I have said without sharing these on-going observations with others. It is only by becoming familiar with this structure that I am becoming able to use it - as a structure - or talk about it, at all. As I said to JJ, I do not count it, I just look at it and observe that it is doing what it is doing. I follow it. Certain paths seem dominant, others recessive. Angles and planes emerge and retreat. But there are certainly rules, and the darn thing displays the rules without any help from me.
It is my belief that this is a giant fractal and that it is, itself, part of an even larger fractal - and I am not alone in this belief.
But, I cannot prove it, yet.
And, to my knowledge, neither can anyone else.
i.
P.S. I would have made a tremendous amount of money on this rise, if only I had believed what I was seeing... Having finally foresworn dogma, and having seen for myself the predictive power of this structure, I am finally sold. But for a long time I dismissed these "spider-webs" myself...
I have also taken the wise AA's advice to heart... but that is another post... |
