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Jim,
You may be right on, time will tell. In the mean time, we can
make some good money trading the horizontal channel if it does hold
for a few months.
Jim
-----Original Message-----
From: Wooglinx@xxxxxxx <Wooglinx@xxxxxxx>
To: metastock@xxxxxxxxxxxxx <metastock@xxxxxxxxxxxxx>
Cc: Sheldon Koepf <sheldonk@xxxxxxxxx>
Date: Saturday, September 19, 1998 9:19 PM
Subject: Head & Shoulders Top
>Guy Tann & Jim Greening have had an ongoing dialogue in a thread
entitled
>"Finally a Signal!!". This comment speaks to their analysis of a wide
channel
>in the Dow of 1350 points and in the SPX of 150 points. Could this
channel may
>be the right shoulder of a H & S top? Vizualize the Dow as follows:
>
>Left Shoulder:
>
>7355 to 8200 / 8300 from June 1997 thru Jan 1998.
>
>Head ( or Double Head)
>
>In Feb '98 the Dow rose above 8300 to 9200+ in April/May. Then after
a slight
>dip rose to a new high of ca. 9367 on July 21st. Then it collapsed to
a low
>of ca. 7400 on 9/1/98.
>
>Right Shoulder - Now Forming.
>
>After holding reasonably well at above 7400 it bounced to 8100 a few
days ago.
>If we continue in a trading range of 7400 to 8200 for 5 to 6 months,
the H&S
>top would become a reality. Any break thru the 7355 / 7400 neckline
would
>result in an ultimate collapse to ????. (Measured move would be from
the
>neckline of 7355 to the high of 9367 for a drop of over 2000 points
from 7355
>to ca. 5355!!!)
>
>The same picture can be seen on the SPX: Left Shoulder in the 910-985
range;
>Right shoulder in the 955- 1045 range and a slightly upward bias
neckline from
>930 in Dec 1997 to 955 range in Sept 1998.
>
>The above senario also seems to fit the gestation of the asian
contagion
>spreading throughout the world and into the US economy in the next
year.
>
>Please do not hang me on the precision of the numbers above. They are
close
>enough to support the hypothesis. One question I have is whether such
a long
>time to form a H&S is applicable. Neither Edwards and Magee nor John
Murphy
>speak to the length of time for formation in their books (at least
that I
>could find). Any input would be appreciated.
>
>Jim Barone
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