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Technology Stocks : Compaq -- Ignore unavailable to you. Want to Upgrade?

To: Elwood P. Dowd who wrote (95038)	2/1/2002 12:20:45 AM
From: Night Writer	Read Replies (1) \| Respond to of 97611

Amateur TA. COMPX downtrend using 1/9 (2098) and 1/29 (1959). Advance stopped short of down trend line. DOW downtrend using 1/7 (10300) and 1/31 (9922). We are looking for the reactive high to mark the second point of the downtrend. It is possible that 1/29 was the reactive high and that 1/31/02 breaks above the downtrend. CPQ TA analysis. Since the 11/14 run CPQ has made slightly higher closing highs at $11.65, $11.68, $11.80, $11.99, $12.05, $12.35 on decreasing higher volume days and backed off of the highs on lighter volume days. Using two daily highs (1/7 & 1/25) and lows (1/9 & 1/23), CPQ has a perfect rectangle with good volume indications. Heavy volume on the up side and light volume on the down side. CPQ closed above the rectangle on 1/31/02 at $12.35 with above average volume. Page 147 “Technical Analysis of Financial Markets” “The Rectangle formation often goes by other names, but is usually easy to spot on a price chart. It represents a pause in the trend during which prices move sideways between two parallel horizontal lines. The rectangle is sometimes referred to as a trading range or a congestion area. In Dow Theory parlance, it is referred to as a line. Whatever it is called, it usually represents just a consolation period in the existing trend, and is usually resolved in the direction of the market trend that proceeded its occurrence. In terms of forecasting value, it can be viewed as being similar to the symmetric triangle but with flat instead of converging trend lines. A decisive close outside of either the upper or lower boundary signals completion of the rectangle and points in the direction of the trend. The market analyst must always be on the alert, however, that the rectangular consolidation does not turn into a reversal pattern. “ Volume is important in this pattern. “If the rallies are on heavier and the set backs on lighter volume, then the formation is probably a continuation in the uptrend. If the heavier volume is on the downside, then it can be considered a warning of a possible trend reversal in the works.” In other words, $10.80 is the support area. A break below this support and the downtrend takes over. $12.28 is the resistance area. A break above resistance and the uptrend takes over. Was the 1/31/02 $12.35 close a decisive close above the upper boundary? Does the HWP CPQ merger on the horizon kill the TA? Let’s see what happens. NW