Thursday, March 14, 2002
Raking the Sand in the Garden
I love those zen sand and rock gardens, with the careful raking suggesting rippling water.
Double tops (1734:1710) and double bottoms (1330:1356) create a number of lines in the sand. Toss in the next bigger picture (ie, the 9/11 lows) and the chart looks more like a raked Zen garden. One image of this I showed recently was the Andrews drawn off prior gaps. I have also described likely turn points as "ranges". Combining retrace methods with the Andrews turns the words into a picture.
The 1488 "line in the sand" is a particularly strong one as it results from two rallies. Going back to the idea of the lines created by double tops and bottoms, this current swing is itself moving within a range, from 1472 to 1492. Call it the shakeout zone. If it indeed turns out to be a very short term bottom.
So, how does one know if there is indeed a reversal or a continuation
at this time? I don't think anyone
knows, but the Andrews can be a guide. There has already been a significant reversal with the recent island top. There is pretty decent support given by the confluence of two Andrews (red & purple) right here (1480). IMO, it may be "locked" to below 1492:1519 as the more "powerful" rally(the lime-green emanating from the stronger rally pivots) suggests further correction in order.
Should price break down through the red-purple forks, it would suggest the full move to the lime-green, whose target right now is 1452, also the 50% retrace of the little rally to 1573.
[tried to post this since 10am, but our friendly Booger, er Blogger agent, has been out of sorts]
At last, over the rim
of the waiting earth
the moon lifted with
slow majesty
till it swung clear of the horizon and rode off,
free of moorings
- Kenneth Grahame,
The Wind in the Willows
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