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Fred, I agree with you that in following E&M on patterns volume, if possible,
should be part of the equation. However, I subscribed to Martin Pring's Letter
for some time. He quite often relied on Indicator pattern formations in his
analysis. This was particularly true with his KST, which is a refinement of ROC
and produces a pattern similar to the MACD. Pring ALWAYS waited for price
confirmation however.
Fred Bender wrote:
> I would be cautious about applying Head-and-Shoulders, or other Edwards
> and McGee chart patterns, on indicators. Reason: these are all price AND
> VOLUME patterns. E&M warn that price patterns aren't valid without
> appropriate volume patterns
> at the same time.
>
> On the other hand, I think 7400 will be taken out, too, when the next big
> domino (Brazil?) falls. The question seems to be, will there be a decent
> bounce first? I think
> not.
>
> Fred Bender
>
> Steve Gochuico wrote:
>
> > Here's one BIG S-H-S seen on MACD applied to the
> > DOW weekly chart. The MACD indicator has just
> > broken its neckline. Conclusions anyone?
> >
> > ------------------------------------------------------------------------
> >
> > Name: DJmacd.gif
> > DJmacd.gif Type: GIF Image (image/gif)
> > Encoding: base64
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