weekend charting , page-15

RichardNixon

You asked the question about the wedge and sure its possible, and i guess the best way to answer a scary pattern like this is to look at history and accept where our real support is. Part the reason the markets are pushed high here is so that its gets away from major support so that any big fall will only bring it back to this support area. Right now the support i think is 3700, but 4000 gets stronger everyday

So lets look at the 1987 aftermath. What happened was a recovery to the 50% level and then 7 years of strong resitance and strong support. I call them the great walls of China. When you have massive moves in Price time is required to absorb these moves. If a channel develops take advantage of it until you get the impuls move and a break of the walls.



So a simple chart of now does highlight what could happen again as history does repeat.


So we look at 2003 and what happened after that low, i popped the RSI i use longer on the chart and you can clearly see how long before a significant sell signal came in, now see the arrows and the first 2 legs up and what a small part of the total price action they were ??



Now heres the RSI on the current chart and so far pretty similar ???? So when i get a significant sell signal on that i might decide to change my opinion some



Regards
Rob