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

To: awi who wrote (40103)	2/13/2000 10:53:00 AM
From: Michael Watkins	Respond to of 99985

Anko If they don't rally back considerably (to their tops), we might just have seen the first leg in a bear market (or perhaps the beginning of a long sideways movement? - I mean would this have to be either a bear or a bull or could it be something in between: bull nor bear???). My approach is to look for horizontal trading bands on daily and perhaps weekly charts. If a stock or market is trading in its uppermost band, I am just cautious (and often standing aside, prefering to trade long or short then the market is not in congestion). If a market drops a band lower... I consider that a bear market until proven otherwise and look for short opportunities primarily. I don't have my regular charts handy, but looking at some crude online charts, I do believe that the NYA (most recent break down was 1/24), DOW (1/20) already meet this requirement. The SPX appears to me to be testing its uppermost band right now. There isnt a convenient lower band anywhere near by on a daily chart (1296 to 1382 by my reckoning and that would be quite exciting). It solidly pierced this uppermost band again on Friday, and for for all intents and purposes closed right on it at 1387 - although we might debate that 1377 is the number to break, the resolution of this chart I am looking at is not great enough. But close nuff, we are very close and any rally from here we need to watch for a subsequent break of this area. I'll see if I can find some foreign index charts clear enough to apply this approach to. Cheers Michael