MARKET INDEX TECHNICAL ANALYSIS - MITA Message Board

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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA

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To: Teresa Lo who wrote (536)	8/11/1999 8:20:00 AM
From: Teresa Lo	Read Replies (1) of 19219

2B or Not 2B? That is the Question. Morning Market SnapShot for Wednesday, August 11, 1999 Yesterday, the S&P broke the June low, a very important level of support. The question now is if this marks a bottom or if this marks the beginning of a very serious correction around the corner. If this test of bottom is successful, the S&P will begin to make ?up? days where the trading range, in relation to the day before, makes a higher high and a higher low. This action is required to confirm any short-term bottom. The balance of this week's trading will determine the market?s fate. It is possible that this test of the June low is successful. Traders through the ages have recognized these and named them appropriately. Known in the past as double bottoms, they are also known as springs in Japanese candlestick terminology. Dunnigan called these patterns Test of Bottoms. Trader Vic calls these 2B bottoms after a 1-2-3 trend change formation. Linda Raschke calls these Turtle Soup(tm) and Turtle Soup Plus One(tm) patterns. We note that the Dow Industrials and the NASDAQ 100 have not tested their respective June lows. The September Treasury bond futures came within a single tick of breaking it?s June low. The CBOE Internet Index tried to make a 2B bottom last week, but has not been able to put a rally together. At the same time, new 52-week NYSE lows outnumber the highs by almost 8:1. The market internals are not yet improving. For more information about the Trader Vic 2B formations, please refer to amazon.com Charts specific to these comments have been posted to intelligentspeculator.com

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