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Strategies & Market Trends : Point and Figure Charting

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To: Challo Jeregy who wrote (6614)	9/1/1998 8:12:00 PM
From: Ms. X	Read Replies (2) of 34809

Timeline May 13th: NYSE Bullish Percent reverses down after reaching 72% in March. The reversal down puts the NYSE Bullish Percent in Bear Alert status. Bring the defensive team on the field. The high of 72% was still lower than the October 1997 highs of 76% while the Dow Jones and S&P 500 moved to new highs. There are lots of right ways to defense. They range from setting stop loss points to taking partial positions off the field to shorting stocks to buying protective puts to selling calls. There are lots of right answers but the important thing is you are aware that the risk in this market is very high. We could have a 1994 market where the Dow Jones and the S&P hold up very well but one by one every sector gets taken out behind the shed and shot. It could be a 1989-1990 market where most stocks got hit in 1989 but it wasn't until August 1990 that the Dow Jones sold off. In 1987 and in October 1997 it came swiftly. However the correction comes, we will be prepared for it. Remember the NYSE Bullish Percent is a leading indicator and it is designed to turn bearish when everything looks the best. Written and printed with permission. Copyright Dorsey Wright and Associates.

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