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Strategies & Market Trends : Point and Figure Charting -- Ignore unavailable to you. Want to Upgrade?

To: Satyr who wrote (495)	2/7/1998 11:43:00 AM
From: Ms. X	Read Replies (1) \| Respond to of 34816

Tom Dorsey, Market Game Plan.-Important for everyone to read The idea is to think about possible moves in a chess game. A good chess player will always think 5 moves ahead. Since the Option Stock Bullish Percent reversed up a week ago, we increased our exposure. With the other Bullish Percents reversing up this week, we further accelerated our exposure. We go with the indicators. We aren't just saying it might go up or might go down. We are going with the indication that up, is the play. We are putting our money where our mouth is. Next, we think of what might happen in this current "up" scenario. We simply have about 25% fewer stocks on buy signals than when the Dow Jones and S&P were at this level before. That translates into fewer football players on the field. We either get more on the field so we have a full compliment, (ie. Market broadens out) or at some point it reverses and we are in deep trouble. This action happened in August 1987 with the Dow Jones moving up to a new high with far fewer buy signals on the NYSE. The next reversal back down in the NYSE Bullish Percent was the beginning of a horrible experience. (Remember October '97?) No one can predict, so we go with our indicators and have full faith that if something distasteful is to happen, they will warn us ahead of time. It's a matter of getting the game plan straight in your mind. What you will do if things go right and what you will do if things go wrong. Right now we have recovered the football. The plays we run will determine how and if we score. No football team can determine when they will lose possession of the ball. They simply try to run the most logical plays given their field position, time left in the game, time outs left and such. This is why it is such an interesting game. Everyone gets to be Coach. It is the Coaches that have a logical, organized game plan that will win in the end. The John Wayne coaches will never make it to the playoff's. At some point in time, as they near retirement and reflect on all the money they have lost, they will finally get religion and go back to the basics. Tomorrow we discuss the interest rate scene and how we use the Dow Jones 20 Bond Average. Tom Dorsey dorseywright.com