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

To: Terry Whitman who wrote (31961)	3/10/2002 11:57:02 PM
From: StockOperator	Read Replies (3) \| Respond to of 52237

Terry, You're right about a breakout of it's recent trading range however, it has not broken through the ceiling thats been holding this index in check for the past two years. That resistance is still in check. Are we going to get that break? The next couple of weeks should give us that answer. I waited for the weekend and the close on Friday to respond to this recent upmove in prices. Of course the word upmove doesn't adequately describe what took place these past two weeks. Prior to this move I was not shy in pointing out the carnage in most charts especially in tech land. The end of February saw a complete breakdown in prices, but of course we've seen such a complete reversal of late. The question being is it for real? First of all let me say once again despite the move in the indices so far the downtrend is still intact. With the reversal this month there are potentially some inverse h&s patterns forming (bullish). Look at the weekly for BRCM and COMPX for examples. So is this the big turn the bulls have been waiting for?? The beautiful thing about our current situation is that we are not going to have to wait long to get that answer. This is how I'm playing it from here. I am going to approach this time frame from a couple of different angles. First of all if this move is going to prove to be the real deal I want to let prices do exactly that. Prove it by taking out the immediate resistance on the major indices. For the DOW that level was roughly Friday's close. The S&P at roughly 1200 and the Compx at roughly 2100. Prices would have to trade above all of those levels which would be huge and would carry me to my next levels of resistance. But first things first. My second approach and probably the most important one is reading how the individual charts are forming. I think it only makes sense to say that IF(!) these indices are going to break out from here, they are going to have to do so on the backs of bullish individual chart patterns. Companies like INTC, MSFT, GM, DELL and so on.... are going to have to likewise be bullish and breakout from here. Therefore, any bearish price patterns or breakdowns in the big guys could indeed be our first big clue that the indices won't have the muscle to push through. Because this rally has been so strong and brief it's too early to see the cracks in the dam. But I do have a couple of observations to point out. Look at the trading in INTU this past week. With all the positive price action of the past 10 days and INTU ready to blast out of it's trading pattern, prices turned on a dime and quickly lost ground. The environment for a breakout could not have been better this week but yet prices couldn't muster the move. Also, keep an eye on RATL, AOL and EMLX this week. I thought the close on Friday, respectively painted a weak picture for the week overall. Nevertheless, a strong push through those levels would cause me to change my views. Until then I will be picking away at the (indiv.) charts. It's a do or die situation. Profitable trading. SO