Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

EWI Takes the Gloves Off

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The market has been frustrating a lot of folks, not the least of which our friends at Elliott Wave International. However, they have finally issued their clearest "this is it!" proclamation as of Friday's STU…….

 0116-wave3

Of course, what would STU be without some wiggle room in the text somewhere?

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In other words, "this is what's happening, unless it's not." Joking aside though, I always respect clear projections and declarations. EWI's chief Bob Prechter is no less clear, and his view of a bear market isn't the least bit forgiving. Observe:

0116-WAVEC
Yes, that's a level of about 400 or so on the Dow. I'm not even sure a nuclear apocalypse could produce that kind of result, but there you have it.

So at this point, a number of folks I respect have projections all over the map……..

  • Evil (molecool) is in "hibernation mode";
  • Gary Savage is going for an all-out bull market in gold and silver;
  • Good ol' Tim is still in a grind-it-out bear market mode, but with an ultimate low closer to 6000 than 400!

The handful of longs that I had, I sold on Friday morning. I am 100% short, although 40% of my portfolio is in cash, and I still have used $0 of margin. All the same, a 60% commitment is the highest level I've been at thus far.

Nathaniel Welcomes 2010 (by Nathaniel Goodwin)

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I spent Christmas eve with mom and grandma, sipping mimosas and having a great time. I must have had one too many, 'cause I woke up Christmas day at a truck stop on the Ohio turnpike, about 300 miles from where I live. I was able to hitchhike home right before New-Years, only to find my mom's boyfriend moved into my room. I then spent the weekend setting up my trading station in grandma's room. I wasn't able to pay much attention to the market the last week & 1/2 of 2009, but Monday really got me excited.

Call me stupid, but I started shorting the crap out of the RUT on Monday. Here are a couple of charts of IWM and the RUT. Woohoo, we are making new highs Monday and Tuesday!!!! It really doesn't look that bullish to me though, I'm very comfortable shorting here with loose stops. (Disclaimer, I've been on the wrong side of most trades since July).

RUT

Distribution
  

I know there is a lot of Elliott Wave bashing going on lately, so I haven't posted many EW counts. I usually don't count 1min charts either, but today's count gave me a huge boner right in front of grandma, very embarrassing. If we have a big drop wed or thursday, I'll print this chart out and hang it next to grandma's home-sweet-home cross stitch.

IWM1min
 

One last thing about stops… They are certainly hunting for them, all obvious stops (for bulls and bears) are being hit. I hate saying I have "mental stops" cause that sort of makes me move them up or down, and usually I would have been better off if I just set them and let them be taken out. Right now I'm looking at obvious stops and placing my real stops at an odd % below or above them. A place that may make the "obvious" stop price a place that would become support or resistance in opposite direction. Does that make sense? Maybe I've had one too many mimosas again tonight…

Quote of the Month

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After seeing it mentioned many times in the comments section, I finally bought and started reading Fooled by Randomness, which I am enjoying tremendously. I just finished Section 1 of the book.

As I was reading it last night, a quote on page 126 just about knocked me off my feet (and would have, were it not for the fact I was reading it in bed). It is as follows:

A theory that does not present a set of conditions under which it would be considered wrong would be termed charlatanism – it would be impossible to reject otherwise. Why? Because the astrologist can always find a reason to fit the past event, by saying that Mars was probably in line but not too much so (likewise to me a trader who does not have a point that would make him change his mind is not a trader).

Can you imagine what two words instantly sprang to my mind? They rhyme with "Melliott Crave." Not to say that I've reached any kind of final conclusion personally, but I've got to say again, those words really resonated in a way that I bet a lot of readers here can understand.

I Miss My Bricks

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I'm going to indulge in a few minor sins right now: (a) a touch of self-pity; (b) a touch of blaming someone else for an investment decision; (c) more than a touch of regret.

About a year ago, I was flush with cash, so I decided to do something I'd never done before – – buy some precious metals bullion. I bought a 1000 ounce brick of silver (and when I say brick, I mean brick – – this thing weighed nearly 70 kilos, and I could hardly lift it) and a 1000 gram bar of gold.

I mainly bought them because, frankly, it was just kinda cool. A minuscule reason was all the talk about the need for precious metals just to get by in daily life. But it was mostly just for fun.

However, there was a lot of persistent talk in the EWI STU – – I think this was early this year – – – about how gold was going to tumble from $950 to under $690, and silver would fall even harder. So the fact that these things were kind of unwieldy, were at risk of being stolen, and were – – according to Elliott Wave theory – – at risk of tumbling in value – – made me drive them back to where I bought them, where I sold them for a small profit. I think I made perhaps a thousand bucks. Hardly even worth the trouble of driving around.

As I sit here, watching gold and silver explode yet again to new highs, I can't help but think of the tens of thousands of dollars in profits that I denied myself. And – – I really gotta say – – it just pounds a few more golden- and silver-plated nails into the coffin holding the body of my faith in Elliott Wave as a basis for forward-looking decisions. It's all very cute and precious and lovely in retrospect, but for predictive value………..I'm really having grave doubts.

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