donald: Interesting analysis on DELL, check out MSFT! And, will IBM ever turn? I look forward to your INDEX UPDATE this weekend...hopefully! <g>
To All:
For my Technical Analysis, I look at a variety of popular indicators, simple moving averages (the ones the public watches), chart formations, support resistance areas, trend lines, new highs/lows…etc. And, I combine all that with “my own indicators”, which I give very high weighting, in my decision process.
My indicators are converted into a MACDX format. I prefer the wave structure for following and anticipating signals. I basically have two MACDX Indicators I have created and they produce my signals. However, they are not traditional MACDX! They were developed in 1986-87 to mimic reads from an analyst named Richard Ney. And, are based for the most part on his theories. I have changed them slightly over the years, but to say why would give away some of what is contained in them!
SHT MACDX is used for short and medium term signals (A & B) and NEY MACDX is used for medium and long-term signals (C & D). The D signal has only given four sell signals since its first prior to the 87 plunge. (1990, 1994x2, 1998 current) The D sell signals have not lasted long as the Market has been in a Bull Run since conception. The longest was after the 87 plunge and second longest, so far, was in 1994. However, each time D has been on a Sell signal and C gave a Buy signal it has always meant a bottom in a downturn had already occurred!
(I have created a new NYSE and NASDQ Advance/Decline Indicator, but it is to new for me to bank on! It is a short term indicator and is beginning to signal a pullback!)
The Dow Industrials, Dow Transports, NYSE Composite, SPX, NASDQ Composite and the RUT are all currently in C & D sell signals, with the exception of the Dow Industrials which received a C Buy signal at the close on 10/20! And, many are close to receiving a C Buy.
On first blush, I should be inclined to believe a bottom has been put in place. However, I MUST point out, my indicators, as are many others personal indicators, NOT Bear Market proven, yet!
My current charting software allows only a moving window of 9 years for analysis! So, I cannot back test my indicators to some of the Bear Markets of the past. However, I have not seen this magnitude of downward momentum in my indicators since the 87 plunge. (I have to go back to my previous Dos based Dow Jones software to see the eighties.)
The bottom may well have been placed on Thursday 10/8. I am remaining cautious and will only trade short term Market moves, for now. I went to cash in mid July (above 9000 Dow Ind.) thus I have a buffer. I will choose to leave some money on the table and not try to catch the bottom. Personally, I find it hard to comprehend that the Market will resume the Bull. Yes, some of the helium has been let out of the bubble, but many companies have dropped earnings expectations. So, when companies meet or exceed earnings now, for many it is at reduced expectations. For me, there is just way too much “negative stuff” out there. P/Es are in the stratosphere and I just can't believe they are going to go even higher. If this is a return to the Bull, the bubble will be re-inflated with even more helium than before, YIKES is all I can think to say!
If one takes any position in this current market, DO NOT stay married to it! I am basically a conservative investor. Yes, I do take some chances day trading, but preservation of capital is primary in my strategy. I will remain CAUTIOUS, for now!
BWDIK
Regards,
LG |
