DOW

[Wizard]

I have identified some pattern in the graph since 9 OCT which repeated itself twice. If it occurs for the 3rd time then we are looking at 20 days going south.

[Russ]

Ja,if it occurs 3 times then Osama Bin Laden will fly a microlight into the statue of liberty.That's what I'm hoping for:no casualties,no major damage (just knock the lamp out of the lady's hands-that should do the trick).

[asylum]

Well what pattern is that.

[Wizard]

After the peaks of 9 OCT and 31 OCT the market fell fast. Same thing happened in DEC. 1st peak in 10 DEC and second in 26 DEC.Then the market was going just one way> Down. Now we have a peak on 1 FEB then another one in 13 FEB. If the same process continues then the market will go down to maybe 11500.

[asylum]

yeah i had a look at it but my interpretation is a little different the 9th oct was a new high and then on the 31 oct the dow failed to make the high of 20th july thereby we have a lower high than in july and the start of the downward cycle only when the dow starts making HH will this trend be reversed.omo

[CrownA]

Very interesting observation. And it fits the Elliot Wave theory too. If this is true, then a big downleg is coming! Well done.

[sax]

I have also noted it but the only thing that worries me is with the first 2 if you draw your FIB retrace from their 1st high to 1st low you will see the great fall was each time a close below 61.8 line but this last one it actually closed above it before it came down again..... makes me wonder since our TOP40 did the same and now it is well above 61.8

[Wizard]

The rebound from the first low went to 61.8. The rebound from the second low went to 38 or so. If the next down leg materializes it could go to 11500. TOPI is full of resources and it's a different kettle of fish, but it did go strongly to 61.8 after the low!

[saash]

Following Chartist and his Gap plays, I've been watching all the gaps since start of the year on ALSI. All gap downs since 2 Jan have been closed, but the gaps ups have been left open (like today's runaway gap). If the theory is correct, then each gap is a trap waiting to be traded out.

[asylum]

one would also have to look at what constitutes a runaway gap and the likely hood of that gap closing during close of day ,a 300 point jump might be considered to much and as such might only retrace at a later stage if at all.omo