Parabolic Move Pays

Sunday, October 12, 2008

My post last Thursday advised investors to fasten their seatbelts. I highlighted the parabolic pattern that usually results in a very fast, massive move before a hard reversal. When I posted on Thursday the Dow sat at 10,482 and I believed a move to 9,500 was not unlikely. Little did I know how intense the downside move would be and how profitable a short position would be. The Dow fell for the next 6 days hitting a low of 7,882! The Dow fell 19.38% in 6 days! Parabolic moves are highly profitable but shorts need to be covered now as the 1,000 point rally off the lows on Friday probably leads to much more upside over the next several days.


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