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Strategies & Market Trends : Take the Money and Run

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To: Nancy who wrote (12789)	8/3/2002 12:22:42 PM
From: Jorj X Mckie	Read Replies (2) of 17639

Hi Nancy, First off, I generally flat out ignore the BPINDU because it only has the 30 stocks of the Dow. I prefer the BPNYSE to give a better broad picture of the market stockcharts.com The traditional chart interpretation requires a move of 3 boxes where each box equals 2%. Many of us prefer a little bit more sensitivity on the charts and use 1% boxes. Either way, it is still a three box reversal that indicates a possible change in direction of the market. I also look at the simple line chart as it shows when the indicator starts rolling over. stockcharts.com When it comes to the nasdaq, I look at both the BPNDX and the BPCOMPQ. The BPNDX has only 100 stocks and is therefore more sensitive and volitile than the BPCOMPQ. I expect more false signals from the BPNDX than the BPCOMPQ. But the BPNDX can be a good canary in the coalmine and it is showing that we are not really ready to rocket to new highs. stockcharts.com As you can see, the BPNDX has already turned down, while the BPCOMPQ has not. stockcharts.com But the BPNDX reversing puts me on alert that there may be more weakness on the overall COMP. BTW: there is another speculative interpretation to the BPNDX. That is that it is forming a triangle and waiting to rocket upward. A generic reading of the two charts that challo posted would be that we are already worrisome because of the three box (three Os) reversal. My personal interpretation is that there is an indication that we are going to retest the recent lows.

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