Ask DrBob Message Board - Msg: 16519861

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Strategies & Market Trends : Ask DrBob

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To: Drbob512 who started this subject	10/17/2001 5:53:54 PM
From: longdong_63	of 100058

From wallstreetmonitor: October 17, down 76 to 1646. Other charts will be in later tonight. Still waiting on a little technical info before the site goes pay...perhaps as early as later tonight. Big, ugly bearish engulfing candle on the close today. Both of the weaker areas of support that I mentioned yesterday, gave way today. That's not surprising. It was clear they would on any 'next leg' down. It's very likely that the naz will now fill that lower gap and test the support at 1626. Again that won't be a surprise. It's how it handles that area and/or the trend line that will tell us how strong this pullback is going to be. The heavy volume on this break down was a little disconcerting but the hi/lo held up fairly well. By the way the naz did move up and probe that double fibo point that I've been harping on. It obviously failed to hold that break...thus indicating downside testing. The open was actually 1752 so now we'll call that whole area resistance...1746-52. Again as to support...watch the gap from point at 1626 on a close...if that fails we'll likely see a test of the trend line at about 1600 (goes up every day). That's a fairly significant test as it will soon parallel a fibo point of 1613. It would be a nice bounce point but it seems like it's still a little to close to the present price. More downside might well be required. If the naz fails that point it gets a little more dicey but not yet critical. There's some very weak support at an 'ill placed' engulfing line at 1560. This is where we start to enter a danger zone. Failure there (1560) would set up a test of support at 1528 and a break there might be ominous because the downside momentum would then be difficult to hold. The hanging man open at 1456 would be the next in line and again...we don't want to go there. It's too close to the lows retest of 1387 and failure would become too strong a possibility at this point. We want a higher bottom. It seems to me we could satisfy the requirements of a complete pullback with a hold at the 1560 or 1528 points which coincide with fibo retraces off the trough/peak of 1387/1754 at 1570 and 1527. As you recall I wanted a test of 1528 last week. We may get it. It's not a requirement that we get that low but a test there or even higher at the 1560-70 mark could set the naz up for a continued run. So at this point I'm looking at parameters from 1528 to 1752. I still have us on high alert, at least till the 3rd week in October, so still be exceedingly careful.

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