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>There have been lots of instances of penetrating the >previous day's lows
>and then running out of gas but >nothing I recall even remotely like this.
Dave:
I guess I miss read you, and I suppose I didn't think opening six points
under the previous day's low was all that extreme. I thought the essence of
your point was the reversal off the previous day's low, and subsequent
rally. My point was not to argue, but only:
a) Similar (if not exact) patterns have occurred recently
(my data does show both my examples were (smaller) gaps.
In fact, the 1-31-00 example took out a three month low and then rallied
about 45 points. If you want some more spectacular examples, that are even
more similar, go back to 1997.
b) Variations of the reversal are easy to code and test.
BTW, the sell version of the pattern happened a lot around the new year. As
far as 30 point ranges in August, I guess this year is mellow compared to
last....but we're only getting started.
BW
bill@xxxxxxxxxxxxxxx
>From: "david b. stanley" <davestan@xxxxxxxxxx>
>To: tradewynne@xxxxxxxxxxxxxxx, omega-list@xxxxxxxxxx
>Subject: Re: 3-Headed Dragon
>Date: Thu, 03 Aug 2000 21:18:15 -0700
>
>Greetings Bill,
>
> We must have different data. I don't understand how either one is
>an example of what you are saying nor do I see the analogy to today's
>action other than that they all trade below and then move above the
>previous day's closing range which is common to many days.
> Sorry if I didn't make myself clear.
> I can recall no previous instance of an extreme gap opening below
>the range of a previous day that successfully breached and held
>above the previous day's highs. I think you will find that in such an
>instance, the move typically fails in one of three places.
>1. Just below yesterday's lows.
>2. Just after penetrating yesterday's lows.
>3. Just after penetrating yesterday's closing range.
>
>In neither case you present is the open outside the previous day's range.
>
>1/31/2000 I don't have a gap open. However it is an outside day.
>4/17/2000 I don't have a gap open. Nor is it an outside day. In fact,
>it as an inside day.
>
>dbs
>
>
>
>Bill Wynne wrote:
>
> > Actually there have been a few lower opening gaps followed by huge
>rallies
> > recently: 1-31-00 and 4-17-00 are two good examples. I know many on the
>list
> > think he's evil, and I am no fan myself, but old Larry Williams has
>called a
> > similar pattern "oops" for years: gap down open, followed by a rally
>through
> > the opening range or the previous day's close. It's an easy pattern to
>code
> > and test: If open next bar < {whatever} and {whatever} then buy at
> > {whatever} stop;
> >
> > Bill Wynne
> >
> > Bill@xxxxxxxxxxxxxxx
> >
> > >From: "david b. stanley" <davestan@xxxxxxxxxx>
> > >To: omega-list@xxxxxxxxxx
> > >Subject: 3-Headed Dragon
> > >Date: Thu, 03 Aug 2000 15:12:51 -0700
> > >
> > > I cannot recall the SP ever having gapped down 16 pts and
> > >then clearing the previous day's high and then holding on to it to
> > >boot. And by-the-way, isn't this August? What's up with the 30 pt.
> > >ranges?
> > >The three-headed Index Dragon appears to have awakened with a
> > >vengence never seen before, going from completely inverted to
> > >completely polarized.
> > > There have been lots of instances of penetrating the previous day's
> > >lows
> > >and then running out of gas but nothing I recall even remotely like
> > >this.
> > > I thought it would be an easy short after hitting yesterday's lows.
> > >Thank Goodness I never got a sell signal. The follow-thru after 2:30
>EDT
> > >
> > >left me with my lower jaw hangin' as this old dog saw a new trick.
> > > Clyde Lee earned his upside breakout the hard way.
> > >
> > >still in shock,
> > >
> > >dbs
> > >
>
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