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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (27385)	2/16/2003 2:39:06 PM
From: J.B.C.	Respond to of 57110

>>Am I reading this right? The implication is that we are nearing a class 1 buy, not a sell????<< That's on the weekly, not the daily, which is a totally different animal I believe. BWDIK? Jim

To: Jorj X Mckie who wrote (27385)	2/16/2003 3:47:59 PM
From: Challo Jeregy	Respond to of 57110

I, also, had problems understanding this -- There was help in clarification - ======================================= Challo, OK, let me try to explain... The Weekly Class 1 Buy Signals that hit intraday, but not on a closing basis, would take about 2 to 3 weeks to re-set. Donald said that they were fulfill as the DOW has already rallied about 300 points from the signal. The DOW, OEX, SPX and RUT are in mid-range. The NDX and COMP are in upper mid range. The VIX is in mid-range. Gold has a Negated Class 1 Buy Signal, and could go lower. The HUI is is lower mid-range. Donald thinks that next week might be flat, and suggested a possible trading range of about 40 NDX points for the week, and thinks that after next week we will go lower. We discussed the fact that the DOW and the SPX have/have just about done successful re-tests of their recent lows having coming within the 7% range, however the NDX and the COMP have much further to go. Its possible that the DOW and the SPX set lower lows on this move while the NDX and COMP set higher lows. My understanding is that it would take 3-up days to get a Class 1 Sell Signal and 3 to 4 down days to get a Class 1 Buy Signal. I pointed out that we have the 55-Day Cycle Bottom due this Friday, the 21st, and that its possible that we just sell off to the end of the week without much of a bounce. Of course, we could also get a rally from hell, so who knows. So, basically, we're in mid-range on almost everything and can go either way. Donald thinks that about NDX 1000 might cap this rally, but as ya know he does not set targets. Hope this helps... Norm =========================================== Challo, Don's daily signals are in midrange right now, so if the market moves up for 3 days they would be at class 1 sell and if it moves down for the 3 days they would be a class 1 buy. As for the weekly signal, Don said he had weekly buy signals last week and I think the point is how quickly it is moving towards midrange, the Dow has already bounced 300 points and it will take only one more up day to be in lower midrange. I am guessing that he does not think the weekly signals will get to Class 1 sell territory at this time and will only reach midrange area before continuing down. Kate ============================================== Will add a few notes that I made to maybe complete the picture. VXN has formed a bullish falling wedge (in case you didn't already know that) which, of course is inverse to market. The rydex bull/bear ratio is very heavy to the bear side right now. This is leading many to call for a bottom. However Don, through back-testing, has found that this ratio has functioned as a reliable leading indicator in both bull and bear markets. It has also just made a lower low. It would now take 3-4 down days (estimated) to reach class 1 buys. Due to nearness to Max Pain levels expects flattish/range bound trading next week. Tsunami indicator prediction of minimum 20% NDX selloff not yet fulfilled. Back-testing has shown this indicator successful 13 out of 13 times. 20% would be the 880-883 area. McClellan Oscillator has turned down significantly but still has more potential downside. Market internals are still deteriorating. Donald is now about 26% short and will target a minimum 50% short position depending on internals and prices. Iblaze