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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude
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To: Dnorman who wrote (30493)6/25/1999 4:05:00 PM
From: Doug R  Read Replies (2) of 79270
 
Dennis,

The important thing to know about the ACT/IL is to NEVER buy a stock when it's over the IL. Not many stocks actually do it but when they do the downside is significant. The ACT is where to expect the stock to fall. Once at the ACT, a bounce of the same % as the drop from the top to the bottom (RR) very often occurs. Sometimes it takes a week from the break over the IL to get back to the ACT, sometimes it takes 2 months but the end results are surprisingly consistent.
The technique of constructing the IL/ACT is proprietary and I don't want to publicize it since it's one of the few methods I have that can be affected by being used by too many people. It would eventually become useless that way. I teach the method (among a bunch of other cool stuff) at seminars I give to small groups every 2 or 3 months.
IL = Impossible Line
ACT = ACcelerated Trendline
RR = Reciprocal Retracement

2 stocks I am watching that have come under the influence of a break over the IL are IATV which is nearly done with the downside reaction
and CMNT which is still being stubborn and (probably futilely) for the most part resisting the remainder of the drop it has left. It's ACT is just now reaching 15.

Well, time to get going...I think I have a seminar to do tomorrow. I should get these last loose ends tied up.

Have a good weekend,
Doug R
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