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Al
In looking at your post, and starting my trendline from 10-31-97, connecting
it to the bottom of 1-30-98, then we have broken through the trendline this
month. Actually, with a chart with an increasing slope, we have had several
short term trendlines, IMHO.
Look at the first one beginning at 12-30-94 and extending to 7-31-96. A
second one beginning at 7-31-96 and continuing to 10-31-97. Finally, a
third one beginning 10-31-97 and connecting through 1-30-98. It appears
that we have significantly broken through this last trendline, if we extend
it to the right. By my chart, the next resistance and the next support is
around 1000, or another 60 points down.
My dad's preliminary estimate for this drop, and these are just rough
guesstimates, was 21-22% which would take us back to the top of the parallel
channel for trendline #1 above.
I guess, we feel there is the possibility that we could continue for another
60 point drop and if that doesn't hold, then a further decline to the
930-940 level. Now, chart wise, this doesn't make a lot of sense, but these
would be the calculations based upon another methodology we use. Actually,
I was hoping for a run up of from 50 to maybe 100 points before we dropped
to our 1000 support level, giving me an opportunity to get some better
positions to play with. I would feel better if we had a 50 point run up
before we dropped further, otherwise we run the potential of a major spike
down like 1987 and going through the bear market in about a week's time.
Regards
Guy
-----Original Message-----
From: owner-metastock@xxxxxxxxxxxxx [mailto:owner-metastock@xxxxxxxxxxxxx]
On Behalf Of Al Taglavore
Sent: Saturday, August 15, 1998 1:24 PM
To: MetaStock List Group
Subject: Death of the Bull?
In my attempts to develop a methodology for trading the S&P and as a result
of looking at different time frames, I offer these observations:
If anyone will look at the S&P on a monthly MS chart from Jan of 1994, one
will see a fabulous chart that almost looks like a stairstep.
Since the end of Jan 98 to July 98 there has only been one month that the
S&P traded below the previous months low, and that was only by 2.31 points
This is the first month that we have traded significantly below the
previous month.
If a trendline is drawn from the Oct 97 low, we have YET to touch that
line. It is a sign of strength for a trendline to be touched and therefore
tested, and we have yet to touch the line.
To all that study channels, I ask, are we not now approaching the bottom of
a short term {based on monthly data} channel?
Unless 896.75 on a closing basis is violated, are we not in a bull market
still?
If we do not listen to T V and read newspapers, but trade off of charts,
could we find a more profitable chart pattern?
To all chartist, please give an evaluation.
Al Taglavore
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