face down friday, page-146

funbet, not quite what I said. Voltaire has said the same thing as me pretty much above, but coming out of a different analysis, when he discusses the broadening top formation. I'm long dow calls and xjo stocks, currently out of the money a bit but holding and the spx 1225 figure is my stop loss. As usual with a stop loss, I'm hoping/expecting that spx will move back in my direction ahead of that level. The charts say there is major support well above there. Its just the bottom of the next lower congestion zone. If you use a volume by price chart on spx, I think you'll see what I'm talking about.

Aside from that stuff, I think I can see the impact of overseas investors on the xjo volatility. If you look at the msci australia index, its far far more volatile than xjo although it moves in the same directions. This says to me that overseas investors move in and out of xjo in a much more pressured way in both directions than do the majority of investors in xjo itself. Essentially, these are the people having the biggest impact on xjo. To me, it also says that the excitability of those os investors - probably in response to os events that may or may not impact on xjo - creates some very nice opportnities for local investors, as their big changes in sentiment creat market inefficiencies.