b, check this out. All from Favors:
Sept 24, 1999
Since we will be leaving this afternoon for our Chicago
seminar this update will be brief.
Our bottom line here remains unchanged. We believe the Dow is
near what will become a very important bottom. That bottom
should be seen between here and next Tuesday. On Thursday,
9/24 the 5-Day RSI on the Dow closed at 11.19. Keep in mind
that the RSI cannot fall below 0, so a reading of 11.19 is truly
extreme. The 5-Day RSI on the A/D Line yesterday closed at
7.36. If the RSI cannot fall below 0 the odds are extremely
high that the A/D Line is also near some sort of bottom. We
consider the RSI on the A/D Line to be more important here
than the Dow, because it suggests the rally, when it comes, will
be quite broad. There is still support from here down near or
just under 10100 in the Dow.
-------------------
The week before he said this:
Sept 17, 1999
In our September 13 newsletter we stated the following: "Our
primary wave count labels the 11,365.90 print high of August 24
as the peak of Minute V of Minor 3. The decline from that high
represents Minor Wave 4, which so far has reached a low of
10,732.70 on September 2. The Dow has rallied off that low but
not enough to prove Minor 4 has bottomed quite yet. If the Dow
falls below 10,967 on a print basis next week, it will suggest a
test of 10,732.70 on a print basis. This would of course mean
Minor 4 has not yet seen its Elliott low. If 10,732.70 on a print
basis is broken the Dow could test the 10,549.10 print low of
August 10".
On our subscriber hotline of September 16 we stated: "Last
evening we stated that the 5-Day RSI on the Dow should
probably fall below 30 at any true low in this time frame. The
5-Day RSI today closed at 24.54, now well into oversold
territory. At least, according to this indicator, we are now into
oversold territory suggesting we should be near at least a
short-term low. Now this does not mean the Dow cannot close a
little lower before bottom, but at least according to several of the
momentum indicators the Dow is already into oversold territory,
suggesting we should be near at least a short-term low. Now if
worse comes to worse, that decline could carry the Dow down
near key support near 10,600 on an intraday basis.
The Dow broke 10,967 on September 14 and has since
continued down to a low of 10,626.60 on a print basis and
10,593 intraday on September 16.
There are several good reasons to suspect we have either seen,
or we are at least very close to, a short-term low. The 5-Day
RSI on the Dow closed at 20.48 on 9/16/99. Remember the
RSI reaches oversold territory when it falls below 30, suggesting
you should be near some sort of low. For instance on 12/14/98
the 5-Day RSI closed at 17.99. This was an important bottom
and the Dow proceeded to rally 947 points on a closing basis to
the 1/8/99 high. On 1/22/99 the 5-Day RSI closed at 28.86.
The Dow then rose 248 points on a closing basis to the 2/3/99
high. On 2/9/99 the 5-Day RSI closed at 26.77. That day
marked the start of a major move upward in stock prices. On
5/25 the 5-Day RSI reached 13.96. This was within two days of
the May 27 closing low. The Dow then rose 442 points on a
closing basis in six trading days.
On 6/24 the 5-Day RSI fell to 27.29. The Dow then rose 674
points on a closing basis to the 7/16 high. On 7/26 the 5-Day
RSI reached 15.59. This was the only reading in this time frame
that did not occur very near a bottom. The Dow in fact rose 116
points the next day and then continued down to the August 2
closing low. In this case, the final low came within five days of
the low reading in the RSI. Finally, on August 2 the RSI closed
at 16.33. That day marked a closing low and the Dow rose 680
points on a closing basis to the 11,326 high of 8/25. Yesterday's
20.48 reading in the 5-Day RSI is well within the same area as
the above extreme low readings.
We have stated that the market is normally near a low when it
falls down near or below the bottom of its 21-Day 3 1/2%
Exponential Trading Band. If you check prior records for just the
last 10 months you will find the Dow fell down near or just under
the bottom of this band at the 8/10/99 low, the 6/1 intraday low,
the 1/25/99 intraday low and the 12/14/98 intraday low. Each of
these dates was near the start of strong rallies in the Dow. The
bottom of the band on 9/26/99 was 10,577. The Dow reached a
low of 10,593.09 intraday on 9/16/99, within just 16.09 points
of the bottom of that band.
Other indicators which suggest we should be near a low are Stix,
the 5-Day RSI on the Advance/Decline Line, and the Cycles.
We could test Thursday's lows early next week but we believe
we have either seen or are very close to a bottom. The Cycles
suggest the next important high should occur near 9/28/99 plus
or minus 1 day.
-------------------
Week before he said this:
Sept 3, 1999
In our August newsletter we told subscribers to look for at least
a short-term top near August 24, plus or minus 1 day, and to
then look for a minimum decline of 4% on a closing basis. On
our hotline we gave subscribers an upside projection calling for
11,428 plus or minus 94 points intraday. The Dow reached its
all-time print high of 11,365.90 exactly on August 24. The all-
time intraday high of 11,429 and the all-time closing high of
11,326 both occurred the very next day, August 25. The Dow
then fell 497 points (4.38%) on a closing basis to the August 31
closing low.
On our Sunday, August 29 evening hotline update we told
subscribers to look for a short-term low in the Dow on Monday,
August 30 or Tuesday, August 31, and then a brief rally for one
or two days. We then expected a final low near Friday,
September 3 plus or minus 1 day. The Dow in fact reached a
low of 10,782.10 on a print basis on Tuesday, August 31 and a
closing low of 10,829.20. The Dow then closed up 108 points
on Wednesday; then turned down as expected on Thursday. At
the lows Thursday the Dow was down as much as 205 points,
then closed down 94 points. On Friday, September 3 the Dow
turned back up as expected. At the highs it was up 243 points.
We closed up 235.20.
The Dow followed our forecast for last week fairly well. From
here we would expect a short-term high by Tuesday or
Wednesday of next week and then a brief pullback for a day or
two. Any rally next week above 11,177 intraday in the Dow
next week will turn the Gann Weekly Chart back up. That
should signal higher prices and a potential test of the prior
all-time highs. The prior bull-market highs were 11,429 intraday,
11,365.90 on a print basis and 11,326.00 on a closing basis. If
those levels are exceeded from here it will be quite bullish short
term. If the Dow exceeds 11,177 intraday early next week but
later falls back below 10,670 intraday, a short-term sell signal
will be given.
We remain bullish on the market here and look for new highs
over the coming weeks and months. We have a 10-Week
upside projection currently calling for 11,731 plus or minus 124
points on an intraday basis.
------------------------
Jerry has been calling a bottom for 500 points. He said that the HIGH would be the end of the month (September), but it appears to be anything but. My point? I can't trust his read. |
