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Strategies & Market Trends : Stock Attack II - A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: adcpres who wrote (2423)	3/9/2001 1:08:28 PM
From: JRI	Respond to of 52237

US Freightways warning of lower revs/earnings....Trannies down...first signs?

To: adcpres who wrote (2423)	3/9/2001 2:41:39 PM
From: StockOperator	Read Replies (2) \| Respond to of 52237

adcpres, Let me get back to you on the NYSE. The divergences are interesting. Right now I am going to take my son out for a walk. Seeya later.

To: adcpres who wrote (2423)	3/11/2001 11:55:10 AM
From: StockOperator	Read Replies (2) \| Respond to of 52237

You asked me my opinion on the NYSE and DJIA in particular. Months ago there was a lot of talk about the overall diamond pattern and what that may imply for the index and stocks in this group. If you've noticed lately there has been almost no discussion of it. Why? A couple of weeks ago I read a post on another thread, written by a "technical" trader. He basically said that we shouldn't concern ourselves with this pattern because it has basically resolved itself. This approach is where I think most of the mistakes in TA are made. We look at a pattern in a short time frame and see only that pattern. We focus on a four week bullish triangle, waiting to pull the trigger, while failing to realize that it is the right shoulder of a four month h&s pattern. That is why you so often hear people say "some patterns don't always work." I say they do but you have to look at the big picture. The big picture for the DOW is a massive diamond pattern. Rare and almost always bearish. A 24 month pattern that has formed for a reason. Unlike the other trader that I mentioned, I believe this pattern has not resolved itself, but I do believe it's close. Because of its sheer size predicting the ultimate break, whether up or down, has been very difficult. General comments in the investment community has been that the DOW is "acting" much better than the COMPX (not really a reach<g>). But the question we need to ask ourselves, is the DOW's sideways action indicative of the underlining strength in the market (economy), or is it just late to the party? Can the stocks in this index go unscathed in spite of the carnage seen in the COMPX? It's still too early to say but remember it's a diamond. There are some early warning signs. The DOW had a perfect opportunity to breakout last month and it didn't. Instead it broke down hard. The recent strength has been more on the back of the cyclicals. The trends in GE and IBM are now becoming more apparent and their direction is down. BA and GM two stocks that you mentioned have been strong but according to my read have not broken out yet. If prices grind sideways here through the rest of the month they could set themselves up to roll over. Looking at the short term this coming week is very important. Prices have set themselves up for an interesting test that could point the direction to which way this index breaks. Like I said I believe resolution is close at hand.