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To: Paul Shread who wrote (25685)	7/20/2000 12:35:20 PM
From: John T.	Respond to of 42787

Paul, here's a bearish scenario for the SPX: On the 60-minute chart, the SPX completed wave 5 up on 7/17. Corrective wave A down was completed on 7/19. The SPX is now in corrective wave B up. The next wave should be corrective wave C down, which should take out the lows of 7/19. (Or, if we are in a bear market it could be wave 3 down.) On the 60-minute chart, the SPX may be forming a head and shoulders pattern. The left shoulder is at the highs on 7/11 and the head is at the high on 7/17. The right shoulder could be at today's highs. The rising neckline is drawn across the lows of 7/11 and 7/19. If the SPX does in fact develop and head and shoulders pattern, the neckline of the pattern is in close proximity to the up trend line off of the May 24 lows. This up trend line is also part of a larger rising or bearish wedge. If the SPX moves significantly higher from here, it will negate the proposed head and shoulders pattern. I'm just theorizing here, Paul. What do you think?

To: Paul Shread who wrote (25685)	7/20/2000 12:53:12 PM
From: John T.	Respond to of 42787

Paul, this is a supplement to my last message about a bearish scenario on the SPX. I failed to mention that there is also a broadening pattern on the SPX. This is on the 60-minute chart. The upper trend line is across the highs of 6/2 and 6/19. The lower trend line is across the lows of 6/13 and 6/29. The upper trend line of this broadening pattern was resistance. The SPX broke out over the upper trend line on 7/14 and went on to form a high on 7/17. Since then, the SPX has fallen below the upper trendline and is back inside the broadening formation. This morning, the SPX pierced the upper trendline, but fell back. At this time the upper trendline is resistance. If the SPX cannot break above the upper trend line, that would imply a possible trip to the lower trendline of the broadening pattern which is today at about 1425 to 1430.