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Non-Tech : Dorsey Wright & Associates. Point and Figure
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To: Doppler who wrote (5237)1/23/2000 12:14:00 PM
From: Ms. X  Read Replies (1) of 9427
 
Actually, the comment about the PO isn't exactly correct. We don't just pick the column with the most X's or O's for the vertical count, we choose the column that has come after the last signal, whether a buy or a sell.

If looking at a PO for an upside move you would look for the column of X's that created the buy signal after the last sell signal. This measures the momentum built up in the stock which would approximate the stocks movement from that momentum. That column of X's may or may not be the longest column of X's on the chart. It could very well be the smallest. It is the column that created the break of resistance, the double, triple or spread quad top - that is the one measures.

It could possibly be volume that moves a stock but I'm sure we can find just as many cases where equal volume from day to day created a buy signal.

A pole can be created from continuous buying of the stock with no increase in volume. My point is it doesn't matter. Whether the stock gives a buy or sell is what matters.

In fact, a chart may have an increase, a poll if you will on volume well after the PnF chart has created the buy signal alerting to the upcoming move. Volume didn't create the buy signal and the PO count but it alerted to more interest in the stock. That is the important feature, the alert prior to any move right? You wouldn't want to find out in the middle of an increase you would want to know before. That is what PnF does. Volume very well can come after the PnF signal.
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