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My McClellan oscillator based system has issued two buy signals since the
August low. The first, in mid-August, could be safely ignored because the
oscillator had fallen way under -200 which meant a second major decline
would be required to confirm a bottom. The second signal on 30Sep was a
valid signal because a rising double bottom had been completed under -100
and was preceded by the same pattern on the NASDAQ on 29Sep. My
Overbought/Oversold indicator, which is a simple 10 MA of NH-NL, put in a
lower pivot low on 30Sep than the pivot low on 12Aug failing to confirm the
bottom - compare this to the rising double bottom which confirmed the Oct98
lows on 16Oct and broke to new high on 22Oct. While the OB/OB could yet rise
above the 27Aug pivot high and confirm the rally, the present condition adds
to the non-confirmation provided by the McClellan Summation Index. A long
position is warranted, because the McO is generally reliable and
non-confirmations can be cured, however caution is also warranted as the
current price patterns have been largely corrective. The ND100 should be
monitored closely for signs of weakness.
Earl
----- Original Message -----
From: <Proffittak@xxxxxxx>
To: <realtraders@xxxxxxxxxxxx>
Sent: Thursday, October 07, 1999 7:37 PM
Subject: sp500
> j: sp500
> Date: 10/7/99 9:34:14 PM Eastern Daylight Time
> From: Proffittak
> To: realtraders@xxxxxxxx
>
> hello again
>
> sp is trying real hard to get over 50 day and 200 day m/a @1338-1340
area
> McCllulen osc was showing a bullish divergence
> and new lows are decreasing
> i suspect we penetrate and close above 1340 soon
> big question then is: are we on our way to new hi??
> i suspect we get the answer AFTER expiration
> (i personally did an anticipate a trend instead of waiting for one to
> develop and lost 24 points)
> happy trading
> Ben >>
>
>
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