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wig · 11-18-2002

Slav,

Here are the major turning points based on extreme highs / lows since 1990.

1990 - July high and Oct low
1991 - Mar high and Aug low
1992 - May high and Oct low
1993 - grinded higher all year
1994 - Jan high and april low
1995 - moved higher whole year
1996 - May high and July low
1997 - Feb high, April low, July high and Oct low
1998 - July high and Sept low
1999 - Aug high and Oct low
2000 - Jan high, March low, April high, Sept low and Oct low
2001 - March low, May high and Sept low
2002 - March high, July low and Oct low

As one can see, your observation about these months has some validity as turning points. However, 1990, 1997 and 1998 held July highs while 1996 and 2002 held July lows. October held lows in 90, 92, 97, 99, 00 and 02. No distinct highs were registered in October in the last 12 years.

Of course, this is in the Dow and other equity markets may be different. It may also be different if you looked at closing highs / lows.

I don't know if I can atribute any of this to regular seasonal trends and be consistent. Selling (or buying) in advance of some of these months would have got it shoved straight up ones ass.

What I do know is this. If I look back at all the major turning points in the past and then extrapolate into the future using the numbers I have discussed, one thing is clear.... you either have a synergy at a certain date in the future or you do not.

In other words. If 144 days from this high and 7 years from this low and 30 months from this high and 14 weeks from this low and 84 weeks from this low and 60 years from that low, etc., etc. all happen to point to Sept - Oct 2003 you can rest assured there is a high probability of psychology changing in this date range.

This in essence is what I do. I extrapolate certain numbers into the future and look for synergy.

Of course, this is only half of the puzzle. The other half consists of price. Here I do similar analysis using Elliott Wave and Drummond geometry.

Then, when I find areas where price and time converge, I feel like I have the probabilities necessary to take a position.

And, here's the trick. It is fairly easy to forecast time in advance, while price is usually best forecast using the most recent action. It is also necessary to use this price action to determine if a cycle point is going to be a high or low. Sometimes, what I originally think will be a high ends up being a low. Price action and structure is always the determining factor.

In other words, each day a new piece of the puzzle is turned over which either is confirming or negating a certain scenario. As a result, a trader must be very objective so he can allow the market to "speak" to him.

This is where I think fundamentals breakdown. Fundamentals are the study of the "cause" of events while technical analysis is the study of the events themselves. If a economist believes that if Greenspan cuts rates the market will go up and then Greenspan cuts rates and the market drops, the economist does not know where he is wrong. The market may continue to go down while the reason he bought still suggests up.

In TA, something would have been visibly changed forcing the trader to adjust.

I have obviously simplified much of this, but it would really take up a lot of time to try and detail it all. Plus, so much of it is in my head and I usually cannot access it all at once.

11-18-2002	#65
wig Members Join Date: Oct 2002 Posts: 1,248	Slav, Here are the major turning points based on extreme highs / lows since 1990. 1990 - July high and Oct low 1991 - Mar high and Aug low 1992 - May high and Oct low 1993 - grinded higher all year 1994 - Jan high and april low 1995 - moved higher whole year 1996 - May high and July low 1997 - Feb high, April low, July high and Oct low 1998 - July high and Sept low 1999 - Aug high and Oct low 2000 - Jan high, March low, April high, Sept low and Oct low 2001 - March low, May high and Sept low 2002 - March high, July low and Oct low As one can see, your observation about these months has some validity as turning points. However, 1990, 1997 and 1998 held July highs while 1996 and 2002 held July lows. October held lows in 90, 92, 97, 99, 00 and 02. No distinct highs were registered in October in the last 12 years. Of course, this is in the Dow and other equity markets may be different. It may also be different if you looked at closing highs / lows. I don't know if I can atribute any of this to regular seasonal trends and be consistent. Selling (or buying) in advance of some of these months would have got it shoved straight up ones ass. What I do know is this. If I look back at all the major turning points in the past and then extrapolate into the future using the numbers I have discussed, one thing is clear.... you either have a synergy at a certain date in the future or you do not. In other words. If 144 days from this high and 7 years from this low and 30 months from this high and 14 weeks from this low and 84 weeks from this low and 60 years from that low, etc., etc. all happen to point to Sept - Oct 2003 you can rest assured there is a high probability of psychology changing in this date range. This in essence is what I do. I extrapolate certain numbers into the future and look for synergy. Of course, this is only half of the puzzle. The other half consists of price. Here I do similar analysis using Elliott Wave and Drummond geometry. Then, when I find areas where price and time converge, I feel like I have the probabilities necessary to take a position. And, here's the trick. It is fairly easy to forecast time in advance, while price is usually best forecast using the most recent action. It is also necessary to use this price action to determine if a cycle point is going to be a high or low. Sometimes, what I originally think will be a high ends up being a low. Price action and structure is always the determining factor. In other words, each day a new piece of the puzzle is turned over which either is confirming or negating a certain scenario. As a result, a trader must be very objective so he can allow the market to "speak" to him. This is where I think fundamentals breakdown. Fundamentals are the study of the "cause" of events while technical analysis is the study of the events themselves. If a economist believes that if Greenspan cuts rates the market will go up and then Greenspan cuts rates and the market drops, the economist does not know where he is wrong. The market may continue to go down while the reason he bought still suggests up. In TA, something would have been visibly changed forcing the trader to adjust. I have obviously simplified much of this, but it would really take up a lot of time to try and detail it all. Plus, so much of it is in my head and I usually cannot access it all at once.