THE FTSE - Whats it doing ?

deemy2004 · 30 October 2005 at 12:05AM

So far this year, the market has had a pretty good bull run, with the anticipated correction during october coming on cue as expected.

Unfortunately somethigns going wrong ! :eek:

Whats gone wrong with the bull case ?

The decline below 5225 ! Which has weakened the ftse signficantly.

So what is the chart suggesting ?

At the moment, clearly its way oversold so suggests 5300. After that ? :eek: Not being one to rely on hope, I'll be taking this rally to lighten my portfolio !

It NEEDS to make a base above 5150 !!! AFTER 5300 !

Any views ?

Walletwatch · 30 October 2005 at 11:25AM

Deemy

While I probably am not qualified enough on tech anal to be able to get down to specifics, a year with Reuters and exposure to tech analysis tools have equipped me with some amount of background to be able to look at a chart. If you are an Elliotician, to me, the FTSE looks like the classic Elliott wave, currently on Wave 1 of the 1-2-3-4-5, just having undergone an a-b-c bottom at 5190 and started Wave 1 of the next set of waves.

Do tell me if I am sounding too much like an armchair expert ;-) and also do revert on what you make of the above?

klondyke · 30 October 2005 at 5:53PM

Mmmm - Elliott is always a bit dangerous at this sort of stage as you can't be sure whether it's a-b-c bottom or the start of Wave 3 going downwards with 4 and 5 to come. Though it seems a bit weak for a Third Wave down.

If you're a Gann person you would already be out of the market, though considering re-entry if FTSE continues in a positive upward trend without any sideways dithering.

I'm not an expert, but used to do this sort of analysis for brokers, not so much on the grounds that I believe in either Elliott or Gann, but other people do - and at certain points they agree. So Elliotticians and Gann(ians?) will buy/sell accordingly, thus making self-fulfilling prophecies! Not enough of either followers to significantly shift the market, but often enough to affect traded options market and spread betting.

Haven't watched lately, now I'm retired and don't take the risks I used to!

deemy2004 · 30 October 2005 at 5:53PM

Unfortunately as you know the elliot wave count can switch on a coin flip.

I tend to go from fundemental for the big picture and then progress onto related markets down to the actual index to be traded where the technicals come into play for timing and targets i.e. simple technicals and the more esoteric such as gann or elliot, though having relied on them too much in the past I tend not to take them too seriously.

Yes I have done an elliot chart on the FTSE which suggests that the down swing was a wave a of an 3 or 5 wave decline , if its a 3 wave then its an ABC correction if its 5 or more waves then its a resumption of the bear market... If its neither than it was a 5 wave correction i.e. the wave pattern is completely blown to whatever will seem plausible in many months time given hindsite.

So at the moment, settling on a 50% retracement to around 5300 is to watch what it does there... as given the break below 5225 it suggests lower prices as does the MACD histogram

... hopefully it won't break the low of 5130 though probability now strongly is in favour of it doing so. Hence my posting !!! As all my other posts this year have been BULLISH !!!!!!! :eek: Plenty of stock to offload this coming week

Perhaps as much as 40% of my portfolio ... :eek:

deemy2004 · 30 October 2005 at 6:35PM

klondyke wrote:

Mmmm - Elliott is always a bit dangerous at this sort of stage as you can't be sure whether it's a-b-c bottom or the start of Wave 3 going downwards with 4 and 5 to come. Though it seems a bit weak for a Third Wave down.

If you're a Gann person you would already be out of the market, though considering re-entry if FTSE continues in a positive upward trend without any sideways dithering.

I'm not an expert, but used to do this sort of analysis for brokers, not so much on the grounds that I believe in either Elliott or Gann, but other people do - and at certain points they agree. So Elliotticians and Gann(ians?) will buy/sell accordingly, thus making self-fulfilling prophecies! Not enough of either followers to significantly shift the market, but often enough to affect traded options market and spread betting.

Haven't watched lately, now I'm retired and don't take the risks I used to!

Could'nt agree more... the further away you move from the present, the more likely you are to be wrong

... thats why you have to keep it simple and pure.... nto get obsessed with gann squaring of time and price

or elliot counts that imply near decades of future action

... As the guru of elliot waves Pretcher published in a book that I have sat on my shelf, following the 1987 crash that THAT was THE FINAL top !.... :rotfl:

Just that to focus on what it has just done and is doing now ! And for me, anyway... its the fact that it broke below the 5225 previous low, which suggests weakness, up until that point I was a raging bull !!!!

BTW one of my favourite trading books of all time is How to Make Profits Trading in Commodities by Gann...

.... though I could never take the other astrology realted stuff seriously

And my gann charts always used to end up with a near billions angles, interecting each other all over the place so completly meaningless