(Click on image above to enlarge it.)
Here at the daily level we can see that there were NMC, NMC2, and NXC Zero Hits occurring during the week of 9/26/08, in conjunction with the weekly time frame Cross Kiss Zero Hit reviewed previously. As mentioned on other occasions, when multiple time frames generate simultaneous signals, the resulting outcome is usually more pronounced. In this case, Crude declined by more than $35.00 (35%) in less than 20 trading days.
An NMC2 Zero Hit (sub-graph 2) formed on Monday 9/22 (with a rare NXC agreement, sub-graph 3), and an NMC Zero Hit developed on Thursday 9/25 (also with NXC agreement).
Other Ocean events surrounding this period include NST (sub-graph 4) which was overbought at the time of the ZH setups (9/22 & 9/25), implying that a dynamic decline was probable, as well as the BTX 1-Line (not shown) and BTX 2-Line which had pulled back to their respective trend thresholds and lower standard deviation boundaries as the setup formed. Once the short trade got underway, these tools turned back up, indicating a resumption of the strong downtrend.
Note also the magenta arrows shown in July and August (7/21, 7/30, and 8/21), denoting locations where other NMC (and NXC) Zero Hits had formed soon after the top had formed on 7/11, and as prices were declining rapidly.
Note the NST and NXC divergence that formed at the market top on 7/11, another clue telling us to wait patiently for other Ocean formations (such as the Cross Kisses) to setup for possible trade signals. As I mentioned during the discussion of the weekly chart, these signals are quite valid sell setups and entries, and formed much earlier in the trend than the weekly setup that we've been discussing.
Here we've concentrated primarily on the September setup and entry because there was a simultaneous weekly setup in that time period, which should almost always generate the fastest, most potent part of an anticipated decline.
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