1937 vs 2008 Updated Daily Chart

Update 10/21/2009:
Put a different spin on it this time. Matched up the rallies. We should be close to a turnaround.

Update 09/13/2009:
Updated the actual chart this time since I failed to do so on my previous comment.

Update 09/10/2009:
My chart made its way onto CNBC (note the title and CNBC's terrible mockup). This was actually an old version that Nenner got a hold of when I was comparing the Q's vs the 1937 INDU. I've been in communication with Nenner since I found out he was watching my chart. Apparently it was sent to him by a bank in Europe. I'm not sure if this being reported on CNBC is a good or bad thing. Its neat that it got some recognition, however now that CNBC has showed it I'm sure Goldman Suchs will change a few algorithms in their HFT to avoid making "history repeat itself" :

Click Here to Watch

Apparently my charts had quite the following, and doing a simple google image search has produced other blogs that have posted by chart. If you know of any others I'd be interested in seeing them.

http://www.meetthefriendlyinvestor.com/2009/04/what-ive-been-lookin...

Also I found this which is pretty interesting:
http://www.mrci.com/special/ddji38.php

91% correlation, not bad eh?

Lastly be sure to keep up with my other posts at the new blog I post at (http://stockjockz.blogspot.com )


Update 08/20/09:
Saw this was featured in a newsletter today, so I figured I would take the time to update it. Hopefully its still of some use. http://stockjockz.blogspot.com is a new blog I post at as well.

Update 04/04/09:
Here is an update. At least you get "more for your money" this time since I haven't done it in a while. Also I'm in super bear mode since I want in this bull market but I'm not willing to chase it. I'll add to some long term positions if we can somehow manage to get down to 750. I think it is more than likely this will occur. There's still too much money on the sidelines, a rally like this catches everyone off guard and I see some kind of drop occuring before any major move higher. Then again I don't have much experience with major rallies, just can base it off my own analysis and what I've learned in the past 6 months. Since I haven't updated in a while, here is a second chart comparing the old to the new. Weekly Chart of the DJIA.

Update 03/18/09:
I apologize for the lack of updates. As Idan was on break last week, so was I. I've also begun studying for the CFA exam in June and I think I'm a little behind so I'm trying to play catch up. Trading comes of secondary importance, especially since I do a pretty crappy job at timing the market unless its on paper. I'm just an amateur trying to learn.

I did not include the Nasdaq because I do not believe it follows the pattern. The nasdaq never successfully broke to new lows. I also may have misplaced the SPY chart a little too high. However, this pattern was all about waves and not price targets but I would now rather plot the SPY. We may see a pullback sometime in the near future, we are pretty overbought. Its funny, back in late 2008 if you had 4 or so days in a row of up or down days it was out of the ordinary. Now all of a sudden we are in a swing traders market once again and its catching me off guard.

Update 03/06/09:
Sorry for the lack of updates. Anyway I believe its time for this pattern to start to diverge a bit. I favor the upside a bit (see my other blog post). I've added the S&P chart in the background in green due to request.

Update 03/02/09:
Personally I expect a rally based on RSI levels of the Dow Jones 30. This has been quite the decline. In addition, I have fibonnaci support broken today. The only way to save it would be for a major rally tomorrow. Personally, these are the times where I struggle the most, even with this pattern. But when give up on this one now. According to this we might see some type of bounce soon. But it will be only 1 or 2 days.

Update 02/25/09:
Busy, didn't get a chance to watch market to form opinion. No commentary.

Update 02/23/09:
The Q's broke the trendline drawn below; they are doomed. They were down significantly more than the general market. I've posted a zoomed in view of current action. If we are to bounce, tomorrow is the the day (if you are willing to follow the 1937 chart day by day.) We currently closed on the last significant support for the QQQQ's (61.8% retrace), S&P support of lows, and the Dow, well, is in its own world and doesn't seem to have much support left.

Regarding the chart, I'm still trying to make it look better. I got rid of the other stuff such as EW count. You all know by now its following the pattern. No longer any need to prove that to you.I'll get rid of the zoomed in effect on the next one.

Update 02/20/09am:
Feels like a while since I updated this. Had some free time. Did some major color changes. Hopefully it is easier to see. If you have any recommendations on formatting let me know. Regarding the formation I think it is dead on. I'm glad that I changed this to the QQQQ's. I think all along that is what I should have been watching. Basically we are to expect a rally very soon. This will coincide with the double bottom attempt in the S&P and DJIA. This will allow the bears to finally pile in for the big drop and will be short lived. And one hell of a drop it will be.

Expect a bounce off the 50% retrace and blue trendline:

Update 02/18/09:
I think I will stick with the QQQQ's to continue charting this pattern. This could mean disaster for the overall stock market because we have a long way to fall to break lows in the QQQQs. Expect a short lived bounce at the 50% 28.50 level. I will update the chart weekly from now on.

Update 02/14/09:
Updated the chart with the QQQQ's. Daneric pointed this out to me on the main page and I'm going to say that since the long term nasdaq seems to mirror the 1930 Dow Jones since year 2000 then we should should also use the QQQQ's to chart this pattern. I think I can finally be a comfortable bear. I believe this could fool some people but hopefully we caught it first. By the way I distorted the price a little bit to match it a bit better but the dates and wave formations are the same. That should be the only thing that matters.

Update 02/13/09:
The market has fallen off of the pattern a bit. That is the main reason I haven't updated in a while. It cannot be expected to call every minor move. I plan to update it after tomorrow's trading but as long as are trading sideways I don't see it fit to update on a daily basis. Price is more important than time in these patterns anyway. Daneric made a good point that the Q's already had their move up so perhaps we could be on our way down. I think tomorrow may be a good tell.

Update 02/06/09:
Just when the pattern was starting to deviate, the market comes up with a pretty monster rally. It is safe to say the pattern is still in tact. There's now a very good possibility the pattern continues because I do not see the market rallying for much longer. With added confirmation to the pattern I went ahead and updated the aesthetics of the chart. Hopefully its easier to see. Its a little blurry because i had to compress it to make it a reasonable file size.

Update 02/03/09:
Market rebounding, setting up for a bounce. Any downside from here on out and the pattern may begin to diverge but our main target is still a low in late March. Also I've changed the format a bit, hopefully its not too messy. Let me know if you want me to go back to the previous version. If you look close enough you should at least see the blue line throughout the entire chart.

In addition here is an update to another pattern I have been watching for about 2 months (I've made a few posts about this as well.)

Update 01/31/09:
This drop was to be expected as it correlated to 02/02/1938 - 02/03/1938 on the chart. The dates are beginning to align themselves even closer to one another. Expect upside soon, perhaps as early as Monday.


I will try to update this once a day or whenever I get free time. It shouldn't take too long to update. Amazing to see everyone watching this pattern and all of these blog posts start to appear. When I originally found it, I only presented as a general pattern that followed Daneric's Elliott Wave count. Now it really seems as if the market may be trading off of it. I'm sure a lot of traders have seen this by now and perhaps a drop in March is inevitable.