Eiger

Volume came in at the end of the day yesterday on an up bar at A: Note the volume - ultra high Note the spread - fairly narrow (compare to the last 5-6 bars) Note the close - an up bar, but closes in the middle back under the tops Next bars makes no further progress, but start to sag. ----- Sebastian Manby always looks at the end of the day volume - spread - close characteristics and discovered that what occurs at end of day frequently tells the first hour of trading for the next day. ----- The end of the day characteristics yesterday were bearish. At A, supply hit the market with some force. Look at all that volume. It is the largest 5-minute volume bar on the day. With VSA we ask, what did price do on all that volume? It gave a fairly narrow spread (i.e., lots of activity via the volume, but price was capped via the spread). The bar is an up bar, but the close is in the middle and below the previous highs. Had that been buying, price would have rocketed higher. As Sebastian would expect, the market came off the next morning and traded down. Eiger

Rich, I appreciate your statistical approach to Taylor. As I am beginning to understand TTT, I am seeing that Taylor traded phases (BD, SD, SSD) within a three-day cycle that seems to repeat itself (cycle). He had different rules for each of the phases, depending on how the market played out. Thus, for example, you looked to BUY on a LOW MADE FIRST on a BD, but would look to SHORT on a HIGH MADE FIRST on a BD. He had developed clues for how the market might trade tomorrow (e.g., if on a BD the market closes poorly, the next day could see a violation of the BD low) and rules for how to trade that. He also had ways of calculating levels of penetration and lengths of advances and declines, which I think he used to keep himself in tune with the trend. Overall, a pretty comphrehensive and rather ingenius system. One question I have I am hoping you can shed some light on: Do you ever reset the cycle once you have established it? Taylor talked about using the last 10 days to create the book, and that is pretty straightforward. You would have 3 cycles within that period. Once the BD, SD, SSD cycle is set, do you ever change it? Would we today still be using the same cycle if we had set that cycle last June, say, or does it need to be reset from time-to-time? Thanks for the help, Eiger

I remember Taylor's book being very difficult to read. Talk about jargon! I started reading some of the TTT threads and agree that Why? cerainly has a handle on it. I notice that he has also said a few times that he was looking to apply VSA to Taylor. Perhaps he might like to join us. Maybe we should start a separate thread, as well. I am off to NYC to do psychology for a couple of days. I am bringing Taylor's book with me just to remember how difficult his writing is I do wonder, though, whether or not it will be clearer to me now that I understand the markets a tad better than when I had read his book earlier. Eiger

I usually use a 2.0 to 2.25 point stop on most trades, less if there is a good support or resistance point. If I like a trade and the stop is going to be larger than 2.25 points, I cut size. So, my stop on this trade was exactly where you indicated. I wound up taking the trade off a bit early at the larger blue up arrow. I couldn't tell if the market was making a lower high or just reacting here, so I got out. It is definately harder to read the lower intensity signals, and there was no acceration or much of an impulse move up. I find it a good rule: when i don't have a clue as to what is going on, I exit and certainly don't get into a trade I do use trend lines via Wyckoff and especially horizontal lines. It turned out that the market did move up above the AM high and then had a low volume reaction. Applying both an up tend channel and a support line, you can see that the market came back to the Demand Line and the Horizonatal Support line (more important line). There was a nice confluence of support for a trade there (green arrow), ticks were holding well, and there was good VSA indications on the bars. This trade was taken off at the clear Top Reversal (blue arrow). Note how the ticks showed a significant lack of demand at the highs. It was also noon time, where we often see a counter trend move of some degree occur. Hope this is helpful Eiger

Here's how i read it: S&Ps open (O) gap up at the yesterday afternoon high. Naz was weaker on the open, under the highs of yesterday afternoon. Both make a higher low, then both make a higher high, with the S&Ps somewhat stronger. Both make a higher low, but here is where the difference came - the Naz showed relative strength by hoolding a higher low compared to the S&Ps. The S&Ps had been slightly stronger (better open, better initial higher high), but the (2nd) higher low held by the Naz was markedly strong. This was the significant clue because we had established an uptrend (background, always keep the background in the forefront of your mind ) Hope this is helpful, Eiger

AM Trade Taken long on the 3-min chart from the Test bar (green arrow). There was no acceleration to the downside on the retest of the AM lows. Objective for the trade is yesterday's high at 905. Note the three bars prior to the Test bar: Volume increases on these bars (in Studies in Tape Reading, Wyckoff talks a lot about volume "swelling" at the end of a move, as it did here. The first bar (of the three) is an average spread down bar, closing on its lows on an increase in volume. Next bar dips under the prior bar's low and closes on it's high - bullish. The following bar also closes near its highs on good volume, but the clue here is the higher low this bar puts in -bullish. Test bar on volume less than the previous two bars and making a higher low - bullish and entry Tom Williams talks about how VSA indications come in different intensities. This is a good example. Volume did not spike, as we usually like to see, but all the signs were there nonetheless. With indications of less intensity, i find it can be of help to have other decision support. Certainly, the background is important. This AM opened higher, made a higher low and a higher high, We have an uptrend in the background. In the larger background is the structure of the market I posted yesterday - a generally bullish picture. Ticks help, showing no downside pressure and a divergence at the AM lows. The four indicies we been talking about also help, as there were clear indications of relative strength on the Russ & Naz at the entry area. FWIW: This is how i try to build a VSA/Wyckoff Story in making high odds trades. Hope this is helpful, Eiger

This thread seems to have been "closed for maintainence" and the post deleted despite being nominated twice for Topic of the Month??

Pretty cool! Thanks, James.

I've worked with the Taylor Trading Technique as well. I found Taylor's book very difficult to comprehend, and I am not sure his 'Book' is worth doing, but I could easily be wrong on that. Linda Raschke uses Taylor extensively as well as Wyckoff. If you look at her work, pretty much everything she does is based on these. She once told me that if you knew Wyckoff, you would know about 90% of technical trading; the other 10% is Taylor. (Her comment was what originally got me motivated to study Wyckoff). Her book Street Smarts has good material on Taylor. As i understand it, Taylor viewed the market as generally having a 3-day rythym of a Buy Day, Sell Day, and Sell Short Day. (This is the basic Taylor Technique - it has more complexity) Starting with the Buy Day, a trader would look to buy into the market early in the day, hold over night if the market traded bullishly that day, and then looked to close out the long position the following day (the Sell Day). After two up days, the market would typically react, and this was Taylor's Sell Short Day, where he looked to short the market early in the day if conditions were right, but close out his poition at the end of the day or early the following day, as the next day would typically set up a Buy Day opportunity and repeat the cycle all over again. This is the basic rythym, but there are other rules for when the market does not correspond to the 3-day cycle. A big clue to Taylor -- as I understand it -- is watching how the market acts around the prior day's highs and lows. For fun, I looked at the Buy Day (B), Sell Day (S), and Sell Short Days (SS) over the last two weeks in the S&P cash, starting with the obvious Buy Day on Nov 21. Not too shabby If you two (and others) are interested, we could look to incorporate Taylor here and see how it plays out in the S&Ps and the currencies you trade, using Wyckoff and VSA to enter and exit. I, for one, though, would have to do some serious brushing up on Taylor, as i haven't used it in quite some time. Eiger

I don't actually have that many charts. My main charts are the 3 and 5-minute ES, both with Ticks. I also have a 5-minute Wave Chart of the ES. I keep the four indicies up in small charts. A 60-min ES chart shows support & resistance. I then have one last ES chart I keep under the small indicies charts that I use to toggle through different time frames, e.g., 30 to 15 or 10-minute or constant volume - whatever I think would be helpful at the moment. I don't have a market profile chart up. I am just now studying MP, and don't really have the skill set yet to use it. Eiger

Market Structure I find it useful to frame out the market phases or structure on a 60-minute chart. I find using a 60-minute structure to be very helpful real time. The trade I posted earlier today occured at the 918 level -- a resistance level known in advance from this chart where you would expect some sort of a reaction. The attached is the Day Session only data, but the overnight is useful, too. It gives additional areas of S/R that can be -- and often are -- important. A few things about this chart: First the down trend was broken by the swift rally off the bottom in late November. Note how the volume swelled on the lows, indicating the end of the trend. The market then came back down to test the 816 area twice. The 816 level was important as this was where substantial buying first came in during the down trend. Wyckoff/SMI calls this Preliminary Support. This support area is often a loction where the market will hold on subsequent tests, as it did here. The market then built a cause between the 918 and 816 levels. To me, this looks like accumulation. Today the market rallied to the 918 level, where supply had occured earlier, and where we could expect a reaction, which occured. Note the character of the market action over the last two days. I think this is important. We have had two relatively narrow range days. Buying came in on the lows (marked by the green arrows). More importantly, however, is the holding of the gains made thus far by the market. Note how we haven't reacted much over the last two days. In my view, the market is resting here and absorbing whatever overhanging supply remains (areas highlighted by the ovals). Assuming we don't fail here and react lower (always a possibility), but instead rally out of this congestion, higher prices seem likely. There has been enough cause built to test the 1006.75 level and, if successul, to go beyond that area. Up this this point, we appear to be testing the lows of the last two days via a Sping. To me, this looks bullish. This will be a good area to watch the major indicies to look for relative strength or weakness/confirmation. This is one of the potential turning points where observing these indicies can be helpful. Hope this is useful, Eiger Eiger

Thanks for the compliment; I appreciate it. I am very much a Wyckoff kind of guy. I was trained in Wyckoff and spent many years studying, failing, relearning, etc - all Wyckoff. I knew when I first read the Course that this was the truth. I dedicated myself to learn it and to be able to apply it, which, of course, took a fair amount of time. After I understood the basics of Wyckoff, I was very fortunate to have been mentored by a recognized Wyckoff expert (an individual you might know, or certainly know of) who taught me the nuances of Wyckoff and how to properly trade it. I wouldn't be at all interested in VSA were it not fully based in the Wyckoff method. As for TG, I view it as a business separate from VSA. Like any business, it has its pluses and its minuses. In general, I think TG has more pluses than minuses, but that's just my opinion. Although I did a presentation for them in SFO and will probably do more of the same in the future, I am not really privy to all the inside stuff that goes on, the personalities involved or not involved, etc. Frankly, I'm not really interested in that stuff. I truely love Wyckoff and VSA, and I truely love working with other traders. TG provides a vehicle for that, which for me is quite cool. When I post here, I never mention TG or the software; I'm niether TG's employee nor its representative. I am, however, a big advocate of both VSA and Wyckoff, and talk about both all the time (probably too much ) FWIW I basically view VSA and TG as separate entities, and I prefer to keep my focus on VSA. Eiger

Here is a set-up and trade that is essentially a duplicate of yesterday's trade I posted. This is one of the aspects of VSA - the same set-ups occur again and again: A - High volume up bar, next bar is level, then a down bar on low volume. More rally can be expected. B - Increased volume, close in the middle - supply. C - Same as B, but on higher volume. D - Low volume up bar - are professionals withdrawing? Unclear because it closes on its high. But, next bar is down and closes below D - supply. E - No Demand. Next bar is weak, closing near its lows. F - Upthrust and entry for a short trade. Objective was the small support level at 907.75. Also, if you look at the other indicies (Dow, Naz, Rus) you will see strong relative weakness in the S&Ps and Dow. Hope you find this useful, Eiger

Here we have it again off the open this AM. The S&Ps opened lower, but into the support of yesterday's low and the Globex low (not shown). Note that the Russ held much higher. This and other indications suggested a rally off the open. A little later (2nd chart), everything but the Dow was showing relative strength. Make note of the Naz - it was well ahead of the other indicies. I would be looking to the long side for now. Eiger

In my mind, BB, Wyckoff is intregal to VSA. I really can't separate them.

The Naz certainly used to be a good leader in the 1998-2001 markets. During that period, it almost always led the S&Ps and Dow. It made trading easier. I used to trade the Naz futures quite a bit during that period. At the time, I was trading Wolfe Waves extensively, and the WW would set up nicely on the Naz across different time frames. Since the lows in 2002, though, I don't think it has the same leadership character. It got so beaten in the 2000-2002 downdraft that a lot of traders stopped trading it and the top tech stocks it tends to represent. It is still very useful as an indication of relative strength/relative weakness when compared with the other three indicies as I noted above. As I mentioned, this is a key Wyckoff principle. (In the Wyckoff Course, there is a great section on group indicies and comparing stocks to group and market indicies to determine relative strength and weakness. This was the way Wyckoff selected stocks to trade or to become a component of his very important Wave Chart. VSA also selects stocks in the same manner.). Basically, when using the Naz index for relative stregth/weakness comparisons, you are looking to see weakness or strength show its hand at the turning points. Yesterday, all four indicies were tracking together making higher highs and higher lows in the up trend. At the top, however, the S&Ps and Dow printed higher highs, but the Naz and Russ did not. The Naz & Russ were confirming the weakness seen in the volumes and spreads by putting in a lower high at the turning point. This happens all the time and is a useful thing to look for. Typically, we will see the S&Ps and Dow track together and the Naz and Russ track together. It seems to cut along large cap vs. smaller cap stocks. You could probably use only three of the indicies (dropping either the Naz or the Russ), but I like to use all four as the two pairs tend to confirm each other. I'm not sure why the earlier posts seemed to get screwed up like they did. Here is the chart showing relative strength at the bottom. Here the S&Ps and Dow were showing relative strength. They were not following the Naz and Russ to new lows. So, you could say at the bottom that the S&Ps and Dow were the leaders, though I personally don't think much about who is leading. In my mind, I am thinking that the S&Ps and Dow are showing relative strength since they were not confirming the new lows made by the Naz & Russ and they are confirming other VSA indications of strength at the bottom. So, you needn't think in terms of leadership, per se, but relative strength and relative weakness and confirmation or disconfirmation of new highs and new lows. Keep in mind that we also want to see indications of strength or weakness in the background. In other words, using the Wyckoff principle of relative strength/relative weakness in the indicies is useful in confirming the VSA indications; they are not stand-alone indicators. Hope this is helpful, Eiger

Nice analysis, IC. You've got a very good handle on market movements. I especially like the lawn tennis analogy. I think trading in many ways is analogous to sport, especially tennis - at least the psychological aspects are quite similar. Since you asked for assistance in your intial post, you might check out the VSA forum. It seems quite consistent with your style and how you analyze the markets. VSA is a practical and user-friendly method of assessing the structure or the market via the background, and a bar-by-bar analysis of the unfolding market. Many traders do quite well with it. It was developed by an individual who actively traded for a large trading house by accumulating and marking up stocks. There is a pretty good group of traders on the forum who post fairly often, including live trades. Eiger

I found this post on "Re: Trading The Wyckoff Way" interesting and have nominated it accordingly for "Topic Of The Month December, 2008"

Here's the outcome. Note how the volume swelled on the exit bar at F along with the wide spread, close near the highs. Buying came back in, which is not a surprise as we are still in a bullish phase of the intraday market. I generally like to target areas of support and resistance for trade objectives, but had I been trading this with a trailing stop, this kind of action would have encouraged me to immediately take my profits and run. Also, because the premature short taken at C was only a small loss, it was easily made up on this move. I don't think much about losses because I strive to keep them small via tight stops. If I get stopped out (which happens often enough), i don't really care because I know on the next trade or two I will more than make up for the loss. Of course, these are losses that relate to well-defined trades in accordance with my trading plan. A No Demand after clear SOW is a high odds trade most of the time and is a part of my trading plan. If you are trading low probability trades and/or random set-ups, losses will definately mount up and hurt your both your account and your psychology. This will definately affect your ability to perform. When you have a sound trading plan based on VSA and have proven it, small losses are not a bother. BTW, this was the 3-minute ES. Hope this was helpful, Eiger Bump: The bonds are my guess. The main "inflection points" in the S&Ps are 10:00 AM, 12:00 Noon, and 3:00 PM - all EST. You often see reversals and changes in trend around these time. At 10:00 AM, there tends to be news and reports. It is probably also the time when larger time frame interests like funds begin to enter the market. Over the noon hour we often see a counter trend occur as fewer traders are active over lunch time. At 3:00 PM the bonds close. Many S&P and equity traders pay attention to the bonds as an intermarket indicator. How the bonds close will often cause adjustments to S&P and stock positions. I have found the adage that 'the first loss is always the best loss' to be quite true. The Behavioral Finance principle of Loss Aversion has a lot to do with this. We tend to have a natural predisposition to hold onto losses far too long. It takes some psychological effort to overcome our natural tendency. I think if you stick with trading long enough, you eventaully realize that small, early losses are best, and further that losses are really no big deal. China was great. I love that country. This was the first time i have been to Hong Kong, and found that city to be just incredible. I am half toying with the idea of selling my country home in New England and moving back to the city in HK. Wouldn't that be a change! It's good to be back. Eiger Bump: The bonds are my guess. The main "inflection points" in the S&Ps are 10:00 AM, 12:00 Noon, and 3:00 PM - all EST. You often see reversals and changes in trend around these time. At 10:00 AM, there tends to be news and reports. It is probably also the time when larger time frame interests like funds begin to enter the market. Over the noon hour we often see a counter trend occur as fewer traders are active over lunch time. At 3:00 PM the bonds close. Many S&P and equity traders pay attention to the bonds as an intermarket indicator. How the bonds close will often cause adjustments to S&P and stock positions. I have found the adage that 'the first loss is always the best loss' to be quite true. The Behavioral Finance principle of Loss Aversion has a lot to do with this. We tend to have a natural predisposition to hold onto losses far too long. It takes some psychological effort to overcome our natural tendency. I think if you stick with trading long enough, you eventaully realize that small, early losses are best, and further that losses are really no big deal. China was great. I love that country. This was the first time i have been to Hong Kong, and found that city to be just incredible. I am half toying with the idea of selling my country home in New England and moving back to the city in HK. Wouldn't that be a change! It's good to be back. Eiger Bump: ddd Bump: Here is a little piece from Wyckoff you don't see elsewhere that I find very helpful and was a support for the UT trade taken above: Wyckoff traded stocks and placed great emphasis on relative strength and weakness. He would look at a stock and measure its waves and price action against the general market. Tom Williams and VSA talks extensively about this. It can be very important as a decision tool in taking and exiting trades. Here is how I often use it: On my computer screen, I track the major markets on the 5-minute time frame. These are the S&Ps, Dow, Naz 100, and the Russel 2000. I use the ETFs (SPY, DIA, QQQQ), but you can use the futures, too. It doesn't matter. On the profitable trade I made, I took an UT in the ES. There was plenty of evidence on the ES chart to make this trade, as detailed in the above posts. Part of the VSA/Wyckoff Story though, was the relative weakness unfolding in the markets. On the attached chart, you see the 5-min S&Ps, Dow, Naz, and Russ. Note how both the S&Ps and Dow actually printed new high prices after 3:00 EST, but both the Naz and the Russ did not. The smaller cap stocks were indicating that the rally was over. They were showing relative weakness and indicating that lower prices were in the offing. The Generals were not being followed by the Troops, so to speak. If you look very carefully, you will also see that the Naz and the Russ both reached or slightly broke last support before the last up wave (the UT high), but the S&Ps and Dow did not - again, relative weakness. In case you think this a fluke, look at the second chart. It is the same series again, only this time it shows relative strength at the bottom, just before the rally. Again, a key Wyckoff principle sadly omitted elsewhere. To be fair, Wyckoff and VSA would say that you short the relative weakness and buy the relative strength. Thus, on today's trade, the better trade would have been to short the Naz futures. I trade only the S&Ps intraday and don't switch between the four major indicies. Nevertheless, as I hope you can see, watching relative strength and weakness unfold is a useful practice. Eiger Bump: Here is a little piece from Wyckoff you don't see elsewhere that I find very helpful and was a support for the UT trade taken above: Wyckoff traded stocks and placed great emphasis on relative strength and weakness. He would look at a stock and measure its waves and price action against the general market. Tom Williams and VSA talks extensively about this. It can be very important as a decision tool in taking and exiting trades. Here is how I often use it: On my computer screen, I track the major markets on the 5-minute time frame. These are the S&Ps, Dow, Naz 100, and the Russel 2000. I use the ETFs (SPY, DIA, QQQQ), but you can use the futures, too. It doesn't matter. On the profitable trade I made, I took an UT in the ES. There was plenty of evidence on the ES chart to make this trade, as detailed in the above posts. Part of the VSA/Wyckoff Story though, was the relative weakness unfolding in the markets. On the attached chart, you see the 5-min S&Ps, Dow, Naz, and Russ. Note how both the S&Ps and Dow actually printed new high prices after 3:00 EST, but both the Naz and the Russ did not. The smaller cap stocks were indicating that the rally was over. They were showing relative weakness and indicating that lower prices were in the offing. The Generals were not being followed by the Troops, so to speak. If you look very carefully, you will also see that the Naz and the Russ both reached or slightly broke last support before the last up wave (the UT high), but the S&Ps and Dow did not - again, relative weakness. In case you think this a fluke, look at the second chart. It is the same series again, only this time it shows relative strength at the bottom, just before the rally. Again, a key Wyckoff principle sadly omitted elsewhere. To be fair, Wyckoff and VSA would say that you short the relative weakness and buy the relative strength. Thus, on today's trade, the better trade would have been to short the Naz futures. I trade only the S&Ps intraday and don't switch between the four major indicies. Nevertheless, as I hope you can see, watching relative strength and weakness unfold is a useful practice. Eiger Bump: sss

Live trade A nice rally on Friday and again today. But weakness came in as we approached 3:00 EST (often an inflection point in the ES): A - An up bar, wide spread close in the middle on ultra high volume. Selling was evident in this bar. B - More high volume, close inthe middle and an average spread. With all the volume, the spread should have been wider and the bar should have closed on its highs. More weakness. Next bar is down - selling. C - No Demand. An up bar with volume is less than the previous two bars. I took a short on the close of this bar, but it turned out to be premature. I was stopped out for a small (i.e., a very good) loss. D - The first down bar in the rally with an increase in volume - supply is hitting the market - more weakness. E - An Up Thrust. I went short again on the close of this bar. There is clear weakness in the background here at A, B, C, and D. The UT after this kind of weakness shows the market is unlikely to rally higher. Note also that the Demand line had been broken at D and both B and E failed to meet the Supply Line - more weakness. Also, Ticks showed a divergence - the rally was clearly dying. This is putting a VSA or Wyckoff Story together in order to make a trade. I find this a useful thing to do. My objective on this trade is 904.00, a tick above the last support at 903.75. This is not a strong support, but it is rather late in the day and it woul represent over 12 points if reached, which is a pretty good trade. Eiger

I am just returning from three weeks in China. A wonderful country - my third visit. I also got a chance to go to Hong Kong for the first time on this trip. What a great city! Ahh, the high church ... If you look even casually you quickly notice so much is not even Wyckoff. Look closer, and you soon realize there is so much omission. One rule of thumb I've learned over the years is to be suspicious of zelots and their dogmata. But hey, it's all jargon anyway, right? I still submit that the clearest material on Wyckoff are: the vast library of SMI materials; David Weis's two chapters on trading bonds in Charting the Market: The Wyckoff Method (the rest of the book is a pretty good overview, too); Studies in Tape Reading; the Motorway posts on the Aussie Stock Forums; and Tom Williams's Undeclared Secrets of the Stock Market. I haven't posted as much not because of any gagging (no one is supressing or trying to supress my posts). Mainly, I have either been trading, traveling, or doing research on various aspects of trading. I've also been working on a website. With all that going on, I just haven't had much time. I also feel that there is an awful lot of negativism that crops up on this thread. That is tiresome and quite off-putting. A special, separate thread was started for those who wanted to debate and criticize VSA, but that hasn't been good enough, I guess, since they don't post there. When I see the negativity, I tend to withdraw from TL and put my energies into other, more productive activities. It's one thing to have a community of traders interested in exploring the practice of VSA. But that's not what we have here, and it's too bad. Instead, we see the same nattering nabobs of negativism taking the same backhanded swipes and acrimonious pot shots supposedly to illuminate the truth, but in reality, are simply advocating other agendas. Unfortunately, the VSA forum and TL are both diminished by these people, in my opinion. Other traders who want to discuss VSA see a forum with great potential get turned into something substantially less because those with an axe to grind insist that they be heard. Until this changes, I feel less drawn to the forum. As I wrote above, I feel my energy is better spent in other, more productive activities. Eiger

Nice use of multiple time frames! I am off to China this AM for holiday, so this will be my last post for a few weeks. See you then. Eiger

Compare H and the bar prior to H with B and C. Both are two-bar set ups. H is a stronger set up because of the way it went above the high of the prior bar, higher price was rejected, and then closed lower than that low of the prior bar, wiping out all the prior bar's gains - weakness. C went above B and higher price was rejected, but didn't close below the low of B - weakness, but not as strong a signal as H. Hope this is helpful, Eiger

There sure is a lot of fear out there, and it is growing. No one seems to have a sense of what will happen next. Gallows humor is renaming everyone's 401K funds to "101Ks." The VIX nearly hit 90, hedge funds are pulling out of the market in billions, and Citigroup closed at $4.70 today. The world must be coming to an end. The S&P Cash Index (see chart) closed below the July 2002 lows and are actually into 1997 levels. In about 14 months we have wiped out many years' worth of gains. The chart posted is a weekly chart of the S&Ps (SPX) with NYSE Total Volume underneath. Volume was high today, but not massive, not yet climactic. At some point, and I don't know when that will be (no one does), the downside will end. Given the extent of the reaction thus far, the air thick with fear, and the steepening angle of decent, I am thinking that this will likely end in a Selling Climax. Thus, I thought it would be good to review the elements of the Selling Climax according to Wyckoff, who first described it. I've attached a page out of my redactive study of Wyckoff's Case Analysis of the 1930-31 market where he described the SC. These are, of course, mostly Wyckoff's words. You can also review the Wyckoff Course for the actual text. In the attached rendition, the late 1930 market is shown up to the SC. Wyckoff viewed the SC as a prime buying opportunity, followed by the secondary test. If observing a SC during the day, we would expect to see strong selling in the AM, and very strong buying throughout the afternoon. So, whoever is first to ID the SC gets a prize Hope you find this helpful, Eiger

Thanks for the heads up. I'm not surprized that the rate are outragous. We are going to try to get a sim card for the iPhone when we are there. I am hoping we can get an inexpensive one for the few weeks we are traveling through China and Hong Kong. Eiger