Chartology

[lmrhoades]

Anyone here follow the charts? Here is what a smart chartist said on fast money today...Any thoughts?

READING CHARTS IN A MESSY MARKET

How can you make sense of charts in a market as wild as this one? We ask Louise Yamada, esteemed market technician and founder of the aptly named Louise Yamada Technical Research Advisors. Following is a summary of her main points.

Chart: S&P 500, 1993-2008, with 20-month moving average.

Editorial: It looks as if we're in the midst of a structural sell-off, Yamada says the likes of which we haven't seen since 2000. We could be in for an extended bear market period – and it could be global. Sell any rally, she counsels.

Chart: Monthly Relative Performance of S&P Consumer Staples, 1998-2008.

Editorial: If you must be in the market, consumer staples appear to be holding up, Yamada says, and should continue to do so. However this doesn´t mean the prices can´t come down – it just suggests the prices should come down, less.

Chart: Monthly Relative Performance of S&P Financials, 1996-2008.

Editorial: This chart suggests that financials are falling apart, observes Yamada, and that they could continue to deteriorate. Sell the strength.

Conclusion: Better to be out of the market right now wishing you were in.. than in the market wishing you were out.
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LMR

[rffrydr]

http://siliconinvestor.advfn.com/readmsg.aspx?msgid=24288097
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Today is the Tomorrow you worried about Yesterday!

[nodoodahs]

I think charts can provide an excellent read on sentiment.

That said, I think too many changes happen over a decade-and-a-half for said "sentiment" to be as meaningful as they would in an equivalent 15-minute, 15-hour, or 15-day chart.

Show me a good chart going back to the paleozoic era, with candlebars of 15,000 years apiece, and I will send it Yamada to interpret for us.
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I haven’t seen a beatin’ like that since somebody stuck a banana in my pants and turned a monkey loose.