I woke up from my late Sunday afternoon snooze to write my column. I flipped on the charts and couldn’t find Sunday night’s opening bar. I thought there might be something wrong with my data feed. Then I realized I had to adjust the chart to make room for the data. Now look all the way at the bottom of the chart below. Can you see the first hourly bar? It gapped that much.
Corrections are about correcting things. So you can look at the glass being half full or empty. If you think the glass is half full then you have the comfort to realize the crowd is finally waking up out of its complacent slumber. If that happens perhaps we’ll finally be in a position to fight all the ills of the world.
But if you look at the glass half empty you’ll come to realize what I’ve told you for years. Austerity is a policy that has failed every time it has ever been tried. I can’t say the good people of Greece are blameless in this regard because they certainly have a hand in the corruption but Monday’s banking holiday has been a long time in development. So if you look at the glass half empty you may also come to realize that if Greece does have to leave the EU, there is a very good chance they will end up getting bailed out by Russia, not only will they leave the EU, they’ll end up leaving NATO as well. Greedy politicians will not have their cake and eat it, too. Make no mistake; there will be long-term social if not geopolitical implications to this event.
Never allowing a good crisis to go to waste, let me share with you some of my new cutting edge time code busting. The NQ gapped down right in its 55 hour window (+/- 1) off the recent top and we find that over and over again. It doesn’t have to be 55. I’ve been telling you for years when the financial crisis hit the Lehman bankruptcy hit 233 trading days off the SPX/Dow top in 2007 while the TARP vote three weeks later hit precisely at 233 trading days of the NASDAQ top which was Oct. 31, 2007. It took me a while but the light bulb went on and I found the most interesting symmetries be it Gann, Fibonacci or golden spiral take place on gaps.