Shanghai Shanghai

Mid-year Self Review

Per the request of my friend A.A, I did a self review here.

On Nov 16, 2009 I started this place with my very first post Reading of DOW.
In that post I threw in a chart like this
and I said "I calculated the upper limit to be 11245".










9 months passed by, here is how the chart looks like:

The peak is actually 11258. Damn, I missed 13 Dow points.
From the chart, I believe now is a good time to conclude P3 has already started.












Recently I believe I improved a little bit.

On Monday 6/28/2010, around 2:00 I made a post like this.

 The low was 1010.91. This time I miss less than 1 point.
~_*

Wave 5 target

I am back in town. Gold recorded a decent movement. Burst most bears by rally to 1230s. My friend, YJ Yang, had a serious fight with me on gold. It took him 150 points to admit it is impulsive.
Here is the chart I posted on a Chinese website on 4/25. I believe it is still in play. It is a comprehensive break out and retest confirmed pattern. Short term target remains the same at 1250.

At historical new high, where will we go further? Here is a wave estimation. (I am not saying it is a one way road.) The Intermediate target is 1450 based on this wave structure.

Also I found something interesting. That is SPX priced in gold. If we were still in Gold Standard, where is the equity at? TheChartStore updates this chart weekly. It didn't include this week's movement yet.

Trade well.
Live free.

Upgrade Gold to 1195

Rumor says China to raise RMB NEXT WEEK. USD will go down, commodities will go up.
Only problem is the rumor on interest hike. Me thinks it will not happen until late May. We still have time.

To be conservative, I may watch my stop carefully. If GC can close above 1162, I will chase more. Otherwise, it may retest 1120 support.  Anyway this will be a 40 points wave. I am so excited.

I don't disbelieve it

Gold is stronger than I thought again. I exit too earlier and missed about 20 points. Busy is not a good excuse. It is actually my bad judgment. I thought it could not pass 1130 which was the 3/16 high. Not to mention multiple MA, 50% since 1226 and 61.8% of this round all in 1140 neighborhood. Gold end up took the March high and is challenging 2010 high now.

Anyway the breakout need to be respected. I think 1175 is a good number as Andrew (purple), channel (orange) and fib all meet there. Should I take the trade? Yes I think so. The breakout is powerful, but the internal needs some work. 1155 is Jan high and 1160 is 61.8% (blue). With overbought condition like this, I don't think crazy bulls will push it thru. I expect GC stays in the range of 1135-1155 for a while. Any dip below will be a buy. Time series clearly says 4/16 top. It worked perfectly since last Oct. It should work this time as well. 

Dreamed plan: buy dip around 1135 friday, sell 1175 within 1 week.

Will the Wave5 of USD play out

$$$ is at critical point. If the reg channel holds, we may see a wave 5 up, otherwise everything else will be at large, Gold, ES, Oil, you name it.

The Fed "exit" policy may be implemented in the order: 
- first, pull out short-term liquidity tools, such as stop buy back of mbs; 
- further increase the discount rate, which is in rumor now; 
- after raise bank reserve, the famous Chinese way, (Are we Chinese now? Yes we are Chimerican now. Will this strategy work in the US? I doubt);
- last raise interest rate.  

Plan for this week