The reality is, U can't be sure where THE TOP was until a LONG LONG TIME after
IF past is any indicator, they start with wicked sell offs, and a rally back to a significantly LOWER
high say 6-8 months later, THEN SELL OFF even harder to a lower low.
The crash in 2007 certainly started that way, and THE BOTTOM was actually
"standard stuff" , a 1'st virtual fan reversal off a compound down fan system spaning over a year.
When the market appoached the BIG down control line one faitfull day, it gap opened
Just BELOW and blew the doors off to the down side into virtual space to the fateful 666 low
In retrospect, it made a lot of sense.
Definately, and most charts are dealing with multiple times frames, so unless you are watching the market on a daily basis, you won't get it. So you have to look at things historically, like margin debt. Exhuberance, and highs that have huge volatility and reversals. They you know, but it's only still a hunch until after it happens. So far, for eight months, I have been shorting the tops and looking for that break through on support, risking a percentage of profit. So far for about seven times, it hasn't happened.
Of course 5-8 months from now, there should not BE any QE (we'll see
although HOW the government will sell bonds, I dunno, maybe in a recession
and market crash they can).
The market will test the shorts plenty, and there are no real rules.
In 2007 there was a 23.6% correction in July (almost to the penny),
but went on tho make a slightly HIGHER high (THE HIGH) in OCt,
went on to sell to a HIGHER low, failed at 77% back, then
on to 38% correction, bouncy bouncy, but by then was in the grips of
mean down fans, and failures at key bounce bak levels drove it lower.
The 23.6% drop in 2007 only took ONE month!!
But that WAS NOT the start of the bear!!