In the weeks preceding the runup to today's crash I saw a number of overlays of the Hope Rally to the 1987 market before the crash, including this comparison and chart:
I expect more on this over the next day or two. We explored it here at some depth on the anniversary last October and later in December. Even before then, Yves made the first comparison. What shoudl be clarified overnight are the three main causes of today:
- 1987: There are some eery parallels to 1987: pending financial reform, program trading then and now, and troubles in Europe: then a falling Mark, now a falling Euro.
- Big liquidation: There is a rumor of a failed large hedge fund.
- Mistake: There is also a real possibility of a "fat finger" today, hitting the wrong quantity key for P&G and driving program trading bots into a frenzy which abated pretty quickly. Here is that trade (from Market Ticker):
Here is the result (from Jesse's Café Americaín:
Dg,
I see you keep making friends here.
Since I detected your mental problems your personal relationships in this blog have become worse. You need help.
Keep it up my bastard son!!
Tell us the truth... how much money did you lose this week?
You will have to work 6 months in your McDolands job to recover your losses to keep gambling. Do not worry, I will keep your free subscription to my neo garnage service.
Your dad,
Glenn Loser Neely
Posted by: Gleen Loser Neely | Thursday, May 06, 2010 at 10:44 PM
Neely turned bearish LAST WEEK and has profits...
In all fairness, Neely's been bearish for the past year. Even a broken clock is correct twice a day.
Posted by: Don | Thursday, May 06, 2010 at 11:00 PM
DG,
kenny, daneric, evilspeculator have 1000's of hits! seriously
then i guess , loads of lines, labels, and alternatives is the name of the game .
Posted by: vipul garg | Friday, May 07, 2010 at 01:59 AM
DG !!
Neely is still considering the current fall as a B leg which he assumes would take more than 3 months as A took 3 months to form.Ofcourse this would be followed by a C leg and a potential of a new top along with it.Has he changed his view becos i am not a subscriber to his service.I could just figure this wave count of his from a Public email I recieved today from Neowave institute.Has he changed his view or is he of the same view still.
If he is assuming the current fall to be B then judging from the way the first leg behaved (fast) B would surely form as a Triangle.
What is your view on it?
Regards
VB
Posted by: Account Deleted | Friday, May 07, 2010 at 02:37 AM
JT, you must have found a crack between the footer and the floor joists. That's about the only way you could have gotten it.
Posted by: Mamma Boom Boom | Friday, May 07, 2010 at 07:07 AM
"You once posted that the I-Banks employed the smartest of "quants" and financial engineers from the likes of MIT, University of Chicago, Columbia, etc.
If that is indeed the case, then why did their trading algorythms wind-up selling stocks like Proctor & Gamble down to $39 on the Naz when it never traded any lower than $56 on the NYSE?
I mean, that's a difference in market cap of $51 BILLION for crying out loud!
If these I-Banks and their "quants" are so smart, why did they sell some stocks like Accenture (ACN) from $41 down to 0.01 cents... when the stock closed at $41.09
Would you care to explain this???"
Clearly, those guys finished at the bottom of their class.
No, honestly, anyone who's ever developed an algorithm or computer software knows there are ALWAYS scenarios for which you don't code but end up happening. It's Darwinian in that respect. I will put it this way, even within the top 1% of intelligence in the world, there are variations, so that the top 1% of the 1% is smarter than the bottom 1% of the 1%. That's just nature.
Posted by: DG | Friday, May 07, 2010 at 09:45 AM
"I see you keep making friends here."
There are some I get along with just fine. The others are of no concern to me.
"Tell us the truth... how much money did you lose this week?"
I love it. The market goes up and I'm allegedly losing money because I'm a "perma-bear" (no matter how many times I post long trade set-ups). The market goes down and I'm still losing money, according to you. The market goes the direction I say it will and I don't make any money because I'm a "college-kid paper-trader" or maybe I'm a real trader but I "can't pull the trigger".
Man, you guys really got all your bases covered.
Posted by: DG | Friday, May 07, 2010 at 09:50 AM
"
DG,
kenny, daneric, evilspeculator have 1000's of hits! seriously
then i guess , loads of lines, labels, and alternatives is the name of the game .
Posted by: vipul garg | Friday, May 07, 2010 at 01:59 AM"
The Web is a visual medium, at the end of the day!
Posted by: DG | Friday, May 07, 2010 at 09:52 AM
yes, i am going back to learn more visual technical analysis.
Posted by: vipul garg | Friday, May 07, 2010 at 10:03 AM
steven737 - remains a mystery of Genesis was Karl or not
Posted by: yelnick | Wednesday, May 12, 2010 at 03:42 PM