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MrB

1930 Rally Vs 2009 Rally

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Having developed a mild form of autism, I noticed a pattern in this chart from calculatedrisk:

http://dshort.com/charts/bears/four-bears-large.gif

The first big rally following the 1929 crash looked a lot similar to the first big rally of the 2008 crash.

So, I decided to chart it.

Here is my handiwork.....

DOW.bmp

Starting point of the 1929/30 rally is 11/11/1929

Starting point of the 2009 rally is 02/03/2009

If there is any merit in comparing these two periods, then this rally may end sometime 03/08/2009 to 08/08/2009.

Wonder if DrBubb will be impressed?

DOW.bmp

Edited by MrB

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Bubb will overlay this with a star chart and take a sighting on Uranus before jumping around like a loon and being dosed by the nice men in white coats who will withhold his internet privileges again ;)

Don't hold your breath.

You may be right, but why such a narrow period in August? It will happen soon, but I don't think we can nail down a date.

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Took me a whole 30 minutes to do that chart!

I think Uranus is trying to tell us something.

Uranus is saying "Bear market resumes around 3/8/2009"

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Normally markets trade down over the summer period. The 'Sell in May and Go Away Come Back Again On St Leger Day' is one of the few bits of home spun financial wisdom that is backed up by long term statistics. I am therefore always suspicious of summer rallies as they just are n't natural.

Time will tell if this one turns out to be a fake out.

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Normally markets trade down over the summer period. The 'Sell in May and Go Away Come Back Again On St Leger Day' is one of the few bits of home spun financial wisdom that is backed up by long term statistics. I am therefore always suspicious of summer rallies as they just are n't natural.

Time will tell if this one turns out to be a fake out.

Chartist ****** aside, I think once the next down happens, it cold carry on for quite a while. Volumes are through the floor and trading is weak. There will be a lot of fear that prices aer going to retreat to whence they started recently, so, when the market goes down, I am expecting it to go down hard.

Edited by mbga9pgf

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Nice chart. How do they compare with the initial crash?

According to my numbers:

First phase of the 1929 crash was down 40% over 2.5 months before the rally!!

The recent crash was down 53% over 17 months before it rallied.

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I've noticed something very interesting that few people appear to have spotted.

Rallies have a tendency (there's no guarantees in life) to meander upwards to the right of charts and sell-offs have a tendency (still no guarantees) to slope downwards towards the right.

I'm still trying to devise a plan for taking adavantage of this little known phenomenon. I'll start a thread when I've figured it out.

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Funnily enough, John Authers mentioned that his young daughter asked him why did graphs always go from left to right. And why was he always so miserable.

Have you tried turning them up the other way?

She'll go far.

I'm devising a strategy that involves working out the best action to take and then doing the opposite.

The RK 'Inverse of the Obvious' strategy.

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I've added another week of data, and overlaid this with a star chart.

DOW2.bmp

Still on track for a collapse in the next couple of weeks.....

The stars clearly help, good work.

Profits are up because of job losses and cost cutting, consumer demand hasn't returned and is unlikely too for the foreseeable future. I just don't think this rally is sustainable.

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The stars clearly help, good work.

Profits are up because of job losses and cost cutting, consumer demand hasn't returned and is unlikely too for the foreseeable future. I just don't think this rally is sustainable.

If these levels hold, I am going to buy a put on the FTSE or S&P at the beginning of September, traditionally the most bearish month. Both indices have risen a third since the March lows, so there is plenty of scope for a retreat, even if it is only 10% or so from today's prices.

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I've already patented a form of it. Listen to the prevailing opinion then ignore it.

Then when everyone starts to do the same I'm going to develop a contra contra strategy.

Just listen to my prevailing opinion. You'll die rich.

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You may find that's too late.

Checkout the Puetz Crash cycle, which suggests a crash into a low around early September.

I bought Sept. puts last week, to add to my Dec, puts

If only it were so simple that stock markets were governed by the sun and moon...

Perhaps I will be too late, but I would rather think about it when I get back from my holidays, even if I miss the solar eclipse window!

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Bubb will overlay this with a star chart and take a sighting on Uranus before jumping around like a loon and being dosed by the nice men in white coats who will withhold his internet privileges again ;)

Don't hold your breath.

You may be right, but why such a narrow period in August? It will happen soon, but I don't think we can nail down a date.

You need to open your mind to alternative methods of investment. Light up the joss stick and listen to the voices of the universe. There are patterns in there, man.

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Guest Steve Cook
Took me a whole 30 minutes to do that chart!

I think Uranus is trying to tell us something.

Uranus is saying "Bear market resumes around 3/8/2009"

I don't know about Uranus, but mine is telling me that curries don't agree with me.

I'll get my coat.......

Edited by Steve Cook

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