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

To: SpecialK who wrote (25726)	12/7/2001 1:00:30 PM
From: TechTrader42	Respond to of 52237

Well, they haven't quite maxed out yet during this uptrend. We shall see what happens when they close at 100. They have reversed course a few times, but I'd like to see them hit 100, just as they hit 0 during the crash. I posted some numbers ages ago on historical values during the last bull market, and they seemed to give a good indication on market tops. What you say about their staying overbought or oversold is true. They can linger at extremes during breakouts up or down. Other indicators and systems haven't quite maxed out yet, either, so the CI's are in line with those. For example, the VIX and VXN haven't pulled all the way back to extreme lower support levels (with Donchian channels, for example). And MurreyMath-type charts show the possibility of higher levels for QQQ, SPY and DIA. There are other longer-term indicators that haven't given sell signals yet, either.

To: SpecialK who wrote (25726)	12/7/2001 1:26:36 PM
From: TechTrader42	Read Replies (2) \| Respond to of 52237

One big problem with the complacency indexes is defining sell signals. The signals are really any reversals from extreme overbought or oversold levels. But the extremes can change under different market conditions. One is left guessing how high or low they might go. The reversals from the 90s might be taken as sell signals now. But the market has been so bullish that I've been tempted to wait for the CI's to hit 100 intraday and close very near 100, to get certain signals. But those signals might not occur. Further, the market can reverse at midrange levels, when the indexes are near 50. So it isn't really a system. It's not reliable. It's just a guide on where complacency is. Today, I have no idea whether the indexes will continue down to the midrange and reverse, reverse quickly here and continue back up toward 100, or head back down toward 0. The indexes can't be used as a guide for predicting the market. They look back, not forward. When the indexes are at extremes, the likelihood of a reversal is high, but as you point out, they can stay overbought or oversold while the market moves higher or lower. Because of all these flaws in the indexes, I'm offering subscribers a 3% reduction in weekly fees. I've raised the weekly subscription fee by 13% in advance, to make this discount possible.