1Best..Retest..I just read an article on this subject..One thing you have to take into consideration is the number of new lows..In the past when we have had record new lows we have had retests back to and sometimes lower than the previous low..The rallies that followed the first big low number lasted anywhere from 2 days to two weeks before turning back and reaching the same or new lows..Here are the most recent cases...10/20/1987.....8/31/1998 and of course 8/16/2007...That record is good enough for me to remain short and add to my short position on any more up from here with the plan of covering at the previous low or lower...I think we will get a second chance..And if the economy worsens, we will see much lower lows..Remember all the indices escept NASDAQ made new historic highs..It seems unlikely to me that we will go to new highs with economic uncertainties ahead..JMHO
Climactic action on 8/16/2007 = Climactic action on 10/28/1997 with extremely high volumes and the same VIX level to 37.
I commented on VIX breakout in Jun-Jul 2006 bottom call that market is showing similar pattern of 1995.
The current price pattern shows that we are in 1997 pattern when market corrected 10% after a correction of 7%+/- which is Jun-Jul 2006 low.
In 1997, we didn't have a retest of the low after similar "W" formation with lower/low with 10 %+/- correction which is the VIX level 37 which we have seen. After 1997 10% correction, market rallied 60% before 1998 correction of 20%.
In 1998, after 1997 bottom followed by a rally to 60%, we had 20% +/- correction with higher VIX level to 47.
News 
Market Data 
Discover 
AI
