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Strategies & Market Trends : Cents and Sensibility - Kimberly and Friends' Consortium
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To: Jack Hartmann who wrote (97197)4/15/2000 7:48:00 AM
From: stan s.  Read Replies (2) of 108040
 
Hi Jack, I drew up a very simple chart here. Most forms of TA generally point to similar what/ifs once certain areas are breached.
geocities.com

That's the case here ala elliot wave etc. The Nasdaq is sitting on hair support. Not compelling support at all when you look at the overwhelming downdraft.

Contrast that weak support with the much stronger support at 2875-2925. 2830 also fills a gap but that's not really important here.

Odds technically favor a test of 2875-2925 and it's always fine to plan accordingly.

However it's also important that while charts show sentiment, these corrections do not always stop directly on a support line.

Bottoms often free form between support and resistance. We did get some volume capitulation on Friday that often signals a bottom. I wish it had been at stronger support.

Caution would indicate a wait and see as to whether we retest that lower area.

All depends on whether fear is turning into greed at a rapid enough pace this weekend to hold the line where it is.

Actually both scenarios could play out. A test of the 2900 area and return to Friday's close by close Monday would satisfy both camps.

Just as an aside I've mentioned the part the 40 day MA plays in uptrending stocks when it's breached to the downside on a closing basis. That's the 40 day MA in red, that was broken to the downside at around 4600.

Stan
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