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Non-Tech : Dorsey Wright & Associates. Point and Figure -- Ignore unavailable to you. Want to Upgrade?

To: jbuckley who wrote (6043)2/9/2000 9:07:00 AM
From: papi riqui  Respond to of 9427
 
jb,

Looking at the triangle WMT is forming, which column is the beginning of the triangle and does it look like it is starting a bullish breakout?

If this completes a Bullish Triangle formation, the 1st column would be Os (61-54). Needs 5 columns to complete a BT though, so if it trades 61 on this move before reversing to Os, you'll have a Double Top break rather than a Bullish Triangle. Still a nice bullish move though with a good RS reading, but watch for the overhead resistance.



To: jbuckley who wrote (6043)2/10/2000 1:52:00 AM
From: Smooth Drive  Read Replies (1) | Respond to of 9427
 
Hello JB,

>>OJ or someone. Looking at the triangle WMT is forming, which column is the beginning of the triangle and does it look like it is starting a bullish breakout?<<

I see that papi responded to your question. I have a different way of looking at/for triangles.

When I scan a P&F chart, I look for many things, one of which is past symmetrical triangles, how they performed, and if one is currently forming.

So, let's look at WMT.

67 O
66 O
65 O
64 O 1 2 3 4 5
63 O *
62 O X * < Top
61 O X O *
60 O X O X * < Lower Top 
59 O X O X O X 
58 O   O X O X *
57     O 2 O X *  
56     O X O X
55     O X O  < Higher Bottom
54     O * < Bottom
       *

I can see triangles from a mile away. My eye scans back a minimum of five columns, and I look for higher bottoms and lower tops. Often times it will be more than 5 columns.

A symmetrical triangle is nothing more than variations of the bullish and bearish formations.

If you scan back five columns on this chart you've got the X column (59 to 62). Notice that the next X column has a lower top (55 to 60) Now check the O columns. The first O column right is 54 to 61 and the next one has a higher bottom (55 to 59).

Here's something that's important to me. A symmetrical triangle either breaks to the upside or the downside. In either case, it's not the real deal until 1) you get a double top buy or double bottom sell signal and 2) you break through the symmetrical triangle trend line. If WMT hits 61 then it has completed a double top buy signal, penetrated the trend line and it's the real deal. Here's an example of one not yet there:

63 O *
62 O X * 
61 O X O *
60 O X O   *  
59 O X O     *  
58 O   O       *
57     O     X   *
56     O X   X     *
55     O X O X       *        
54     O X O X     *
53     O X O X   *
52     O X O X *
51     O X O *
50     O X *
49     O *
48     *
47

Even though you have five columns with higher bottoms, lower tops and a double top buy signal at 57, you have not broken through the upper trend line and this ain't no symmetrical triangle.

Now -- this is how I interpret and choose to identify symmetrical triangles. I recognize that other's will do them a bit different. I know mine are right<g>.

Take care,

Eric


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