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Strategies & Market Trends : Precious Metals mutual funds (gold, silver, PGMs) -- Ignore unavailable to you. Want to Upgrade?

To: Larry S. who wrote (23)	3/9/1998 7:58:00 AM
From: Richard Mazzarella	Read Replies (1) \| Respond to of 972

Larry, thanks for the url. If you can understand the "waves" the forecaster is a slam dunk IMO. The forecaster has the XAU price bounded by its Bollinger bands. Notice that the XAU stays inside those upper and lower bands? That comes from control theroy where it is postulated that a process "in control" remains between 2 standard deviations above and below the current value 98% of the time. Bollinger applied that theory to stocks and it how has his name. If a stock breaches a Bollinger band, that's called a breakout. Looking at the XAU chart (the one with the XAU candles (red and white boxes)) you can see that the XAU rarely breaches either the upper or lower band. Most times the XAU goes to one band and then reverses. That's part of setting a buy or sell signal. It's a reversal off a band that's important. The other chart with the positive and negative numbers is just an overbought/oversold indicator. The direction across the zero is also used with the Bollinger chart to add certainty to the buy sell decision. A study what the XAU did and what the charts are doing will give some insight. I agree that their explanation is wanting. Hope this helps.