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Strategies & Market Trends : Point and Figure Charting

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To: iGregor who wrote (4785)	7/16/1998 10:09:00 AM
From: Ms. X	Read Replies (3) of 34809

Indicator update and review. Goodmoring all. I know many of you have been asking if the NYSE BP has reversed up, when will it reverse up, why hasn't it reversed up and what in God's beautiful name do we have to do to get it to reverse up. Well. First of all, with any indicator it is the new signals that count towards moving the percentage. Let's say you have a stock that is on a buy signal, whether in O's or X's on the chart the last signal it gave was a buy. Until it gives a sell signal it remains on a buy signal. That counts as 1 pt. It has given its "vote" towards the NYSE BP. It's vote is a buy. Now, it only gets one vote. It doesn't matter if it goes on to break 10 triple tops, a spread quad and a high pole on crack - it gave its one vote already with the first buy. If it reverses and gives a sell signal, it changes its vote to a sell. Again, it could break 50 bottoms all the way down to Hell and it would still only get one vote. The NYSE BP only moves on new signals. If it is stagnant it is because no new signals are given. That is what we have now. What that means is; the stocks that already gave their one vote for a buy signal are making new highs while the others with the one vote for a sell are struggling and not going anywhere. This is why we say it is a narrow rally. The short term indicators are doing fine, moving up which is great if you own those stocks that are making the moves. The concern is that the short term indicators will top out again without the NYSE BP gaining new buy signals. I'm surmising here but if the short term indicators reversed down again without the NYSE BP reversing up - we could see a much lower market. Those few buy signals would turn to sell signals and we'd have a problem. This is why we always keep an eye on the NYSE BP. Play the rallies but know what you are doing. I hope this helps you to understand what moves the NYSE BP. Take care, Jan I am

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