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Strategies & Market Trends : Point and Figure Charting
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To: Al Serrao who wrote (9910)11/20/1998 1:29:00 AM
From: Smooth Drive  Read Replies (2) of 34809
 
Hello Al,

>>Duke60, do you still think this was a small cap rally or was this a tech rally of which many were small caps?<<

I too will be interested in Dick's response. We both are keeping P&F indicators. One that I'm hand charting is what Cohen called the "Index of Speculative Confidence". You divide the Russell 2000 by the S&P 500. Cohen used a 1% P&F chart. If it's rising small stocks are outperforming large cap.

(Recently there was talk of subtracting one from the other and dividing by the large cap. But - it's just a recip of Cohen's.)

Here's a dab from late 95 to current.

55% 
54% 3 
53% U 0
52% O 0
51% I 0
50% S I
49%   2 
48%   5 0
47%   I P L
46%   E J L
45%   S J L
44%   H J I
43%   P   6
42%       W
41%       5
40%       G
39%       S 
38%       J
37%       5
36%       L
35%       B 4
34%       6 4 
33%       8 4
32%       I

On all my market timing P&F charts I use this bastardized numbering system so I know what date the action took place. This chart starts at 50% on 11/17/95. It hit a high of 54% on 5/3/96. Reversed down on 7/10/96 and bottomed at 43% on 4/29/97. Reversed back up on 8/27/97 and topped at 48% on 10/10/97. Reversed back down on 11/25/97 and bottomed at 32% on 10/15/98. Reversed back up on 11/4/98 to 35%, and is currently at 34.22%.

Results per above, as follows:

       11/17/95  7/10/96          7/10/96   8/27/97
S&P5   600.07    656.06   9.33%   656.06    913.7    39.27%
R2     303.84    332.71   9.5%    332.71    420.84   26.49%
 
       8/27/97   11/25/97         11/25/97  11/4/98
S&P5   913.7     950.82   4.06%   950.82    1118.67  17.65%
R2     420.84    426.91   1.44%   426.91     392.96  <7.95%>

       11/4/98   11/19/98
S&P5   1118.67   1152.61  3.03% 
R2      392.96    394.37   .36%


The current upmove might be another head bob or the beginning of a smaller cap rally. I'm going to chart this one next with .05, 1 and 2% log charts going back 10 years.

Take care,

Eric
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