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Bob,
While I agree with your analysis, your opinion of the market, and have
already placed my portfolio 66% short, I have two caveats:
1. Sherman McClellan continually warns against using the Oscillator and
Summation as as a "system", he says they are just "indicators".
2. The market has taught me that it doesn't give a flip about my opinion of
where it's going. The market is going to do what it wants regardless of my
opinion. Therefore I believe most traders need at least a second plan if
there first does not pan out.
FWIW: my second opinion is that the market stays flat through December.
Stock markets can correct two ways. By going down (lowering P/E) or
extended sideways movement (lowering P/E as earnings rise while price
remains constant). My (mental) stops are at the highs of the current
trading range. Prices exceeding the current range on good volume, I will
take my loss. Wouldn't be the first time I was wrong.
Ross Kovacs
rossrk@xxxxxxxxxxxxxx
<snip>
Just wondering how others are interpreting the current NYA pattern and
McClellan Oscillator configuration. It looks to me like there is a
bearish triangle with a decending top and essentially flat bottom. As
the vertex of the price triangle is approached the McClellan Oscillator
is showing extreme weakness in a down channel. Some may be
misinterpreting the oscillator at this time as saying it is oversold
when in fact it can become twice as oversold if the NYA drops through
support in the closing weeks of the quarter. It also seems like there
should be massive tax loss selling this year since the advance decline
line has been dropping for a significantly long time.
Bob Roeske
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