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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: pater tenebrarum who wrote (38110)	1/26/2000 2:21:00 PM
From: flatsville	Read Replies (2) \| Respond to of 99985

heinz--You've mentioned your K-wave post before, but I've not been able to find it. Could you provide a link? TIA

To: pater tenebrarum who wrote (38110)	1/26/2000 8:09:00 PM
From: bearshark	Read Replies (2) \| Respond to of 99985

Heinz: After we exchanged our last notes, I went back and looked at some of my charts from the 1970s. I did read some notes on K-theory and I also read some work on the three peaks and a domed house pattern. I was interested in K-theory after I saw P. Q. Wall's name associated with the chart with the seasons. However, in looking at my charts from the 1970s, I was amazed by two apparent 3 peaks and domed house patterns. They do not quite fit into the classic time period for the pattern but they are close. The first started in September 1970 with 3 peaks from September to November. Then a three leg up-move with two corrections to the domed house in May 1971. That led to about an 18 percent drop until another three-legged up-move that had an initial peak in April 1972; a second peak at the end of May 1972; a third peak in August 1972; a nice rally to the domed house that peaked in January 1973. The domed house was formed with an initial move to 1042 (all INDU figures); a decline to 996 or about 4.5%; and the final move to 1067 in January 1973. Of course, that formation preceded the greatest bear market of my trading experience--about a 46 percent decline in two years. That is a shakeout. It could also be called a good financial ass-kicking. Below is the chart of the INDU with the three peaks. beta.iqc.com You can see the three peaks and there could be the domed house also. The 1973 NYSE advance/decline line was very similar to the one we have now. Throw in Edson Gould's "Three-Step-and-Stumble-Rule" and you have good reason to worry. Going back to the three peaks and a domed house pattern. The two patters I saw--or what appear to be the patterns--were in 1970/71 followed by an 18 percent decline and then the second pattern in 1972/73. The site with the three peaks and dome stuff stated that we had that pattern in 1997/98 followed by a nearly 20 percent decline. So the similarity between the dual patterns from the early 1970s and today's recent patterns is also interesting. The paramount feature for me is the obvious broadening top. Whatever a person wants to call it, it is screaming for attention. It is one of the reasons I am now bearish. I probably will be bullish again if the INDU breaks through 12075.