To: John Pitera who wrote (18048 ) 3/26/2016 11:35:35 AM From: robert b furman 5 RecommendationsRecommended By
Respond to Hi John and Davy,George Lindsay's model, Three Peaks and a Domed House, has a fantastic track record of calling bull market tops for over 100 years--often to the exact date and usually to within three days. The ability to create such an exact forecast requires the integration of Lindsay's other models. However, the attraction of the 3PDh model is that just by being acquainted with the basic form and a few simple guidelines the user can become alerted to a pending top in a bull market several months in advance. FIND THE PEAKS The first step in identifying the formation is labeling the three peaks and the ensuing deep decline Lindsay called the "separating decline." During the separating decline the market must reach a level which is lower than at least one of the reactions following peaks one or two.The sell-off is followed by a period of base-building called, appropriately, the "base." We're looking for an interval (roughly seven months and ten days [222 days]) from either the bottom of the base or the separating decline to the top of the bull market. Typically, a base is horizontal and we count from the second test of the low in the base. Now, observe the DJI chart below and note the following: The VIX, an options-based measure of market expectations for future price swings in the S&P 500, just had its sharpest 25-day decline on record , says MKM Partners’ derivatives strategist, Jim Strugger. The VIX fell from 28 on Feb. 11 to 14 last week. The decline means that demand for short-term options protection fell fast while U.S. stocks roared higher. 5 Days Arms Index (TRIN.IN)Date Arms Index Mar-2016-2024 0.73 Mar-2016-2023 1.87 Mar-2016-2022 1.23 Mar-2016-2021 0.84 Mar-2016-2018 1.2 5 day Total 5.87
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