Technical analysis of S&P 500

Just wanted to throw this out to see if it holds and water (in terms of predictive power), and also educate the masses :)

Technical analysis is a highly debated topic. The way I see it is that if most of the traders believe in it, it makes sense to follow the logic of the crowd (see what happened to the mavericks ;))

S&P is right now at about 879. Looking at the 3 month chart, notice the trend line from Nov 21st low (741) to the Dec 5th low (818). Generally, on the downside, stocks will go back and test either moving averages or trendlines. So based on this, the current trendline is near 850. Interestingly, the 20 day moving average is at 857.

Now there something a lot of technicians love called the head and shoulders patters. What does it look like? Well, head and shoulders!! A bigger peak with two smaller peaks at either side. Now consider and inverse head and shoulders pattern...a lower low bounded by two higher lows. The Nov 21st value at 741 can be thought of as the inverse head and the left side higher low is the Oct 27th value at 852. So if this theory is to hold, then 852 should be the max downside.

Now, the fun part is the reaction, or the "sentimental" low which stands at 840. This has been a value we've tested a number of time both on the downside and the upside. Below this, there will be a number of stop losses that will trigger which can pull the index down pretty sharply. 

So the way I see it, we should have a low between 840 to 850 before moving into gear for a year-end rally.

I'll try to post some pictures later to illistrate all of this. For now, hope this link to the yahoo finance technical analysis chart works.

Idea factory: Alternate SMS infrastructure

Tired of paying 10 to 20c per sms? Wonder how retarded it is that you still have to pay for SMS even with a data plan!! Here's the solution...SMS over Wi-fi/3G data connectiion. The idea is as follows

- User chooses recepient; chooses if message is urgent/not urgent

- Atl SMS client side app sends data to server which checks that both are registered with the service. 

- It then monitors to see if a Wi-fi connection is avbl. If not, it checks whether a 3G data connection is avbl (this can be disabled if you don't want to use 3D data plan at all).

- If avbl, it sends the SMS to recepient and the client app at the other end confirms receipt of message! So you are sure your SMS went through

- If not avbl, and you chose urgent, it will send the message using the cellphone providers SMS service. If you chose not urgent, it will hold the message in outbox until some data network is available

Guess who thinks this is'nt an awesome idea..the mobile service providers of course, since this will strangle their juicy revenue stream. Well screw them! Power to the people :)

Comment on WSJ article: Deepak blames America

I came across an article in the WSJ. This piece is written by a member of the WSJ editorial board..here's the link to the article: Deepak Blames America

After reading it, I posted the below comment in the forum section of this article.

What I find interesting is that your newspaper gives an outlet for people to vent their frustration. I guess most of your readers think THEY are the true patriots and anyone wishing that the US change its policy based on the repercussions (i.e. use soft power more effectively, than raw military force) must be a traitor! I won't comment directly on the interviews with Dr. Chopra since I did not see them (given that I hardly see television in the belief that the written word tends to be less sensational). I guess then that it is your newspapers' agenda to make even this media more jingoistic. Kudos to your success.
Stimit

Idea factory: Non-profit to kill Dawood

Here's an idea. The bastard behind the Bombay bomb blasts and the one who provided intel to this recent bunch of shitholes was Dawood Ibrahim. How about starting a non-profit fund to catch him, better dead than alive? The fund will collect money and the kitty will grow until the prize is awarded..to the one who brings his head on a platter.