" The post from thi suggests either a bigger move and/or taking longer in duration than originally expected from this cycle...What you think will play out here? "
I understand the nature of your question perfectly because it's the same question I have. This isn't a "typical" situation. I did expect a smaller base and a rather small move that "could" have hit an important breakout area, but the way it would look on the outside would be very different than the way it looks on the inside, meaning a breakout move that appears by price only to be strong, could in fact be VERY weak and so far all this week that has been our experience, the 3C charts have remained very weak, seemingly like the invisible hand that sets these cycles up is trying to do it with the least funds committed to a cycle (which they always make back just as if we hitch-hiked a ride on the trade, but have very different intensions once we get to where we were hoping to go...i.e- ride a move higher with some calls, but our main intension is selling short core positions like PCLN as it makes a move toward the area we were looking for).
What I was trying to convey earlier is that typically when we have a nice rounding base like this and it's 4 or 5 days in the making, we usually would have a VERY strong 3C signal to go with it, we have a nice price pattern, but the 3C signal is not what we'd normally expect and this makes sense to me. I think the market does want this move as it sets up so many shorts like PCLN right now, but I think this entire week it has just been cautious and more in a "wait and see" mode because of the debt-cieling and political fight that could shut down the government with the deadline fast approaching.
So my question is the same as yours, "Does this bigger base equal a bigger move?" or is this just a bigger base, not because it's in the reversal process of being accumulated, but a more apathetic process of, "Lets just wait and see what D.C. is going to do" and I think that is why (if you recall I posted yesterday and a time or two again this week) that the base of this week has to be kept in perspective with the bigger picture charts because it feels like it is teetering on a fence and on one side is the upside pop and the other side is a disproportionately longer, larger, stronger downtrend.
This is why I haven't been aggressive or even in the typical mode for opening new positions, I've been very cautious as well as the risk:reward of either event are no where near equal.
The only way we'll know for sure is if 3C shows drastic improvement, suggesting Wall St. is now satisfied that the "Surprise" risk has diminished like a government shut down or some other objective and confirmed data; that's where all of our probabilities come from, objective data and the amount of it that we can confirm.
So this is a different scenario than most in that the size of the base right now which as far as the "Reversal Process" goes, is absolutely beautiful, but everything else we'd expect to see go along with such a base simply hasn't been there and I feel very confident it's because they are being cautious about the political/economic situation at hand and we are being cautious because of the objective data that essentially shows us that they are being cautious.
I could put this all in context of the politics, but that's not my speciality, Wall St. has better information and will have it long before it is reflected in price so I'm more just watching what they are actually doing in the market rather than what anyone is saying in the news.
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