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

To: David N. Jones who wrote (2019)	3/26/1998 10:17:00 AM
From: Ms. X	Read Replies (1) \| Respond to of 34813

Hi David, Relative strength measures the performance of the stock with the rest of the market. When the RS reverses into O's it is under-performing. It can reverse by a sudden drop in price or a slow steady drop or by trading sideways. The point is, when we get this signal we know things are not stacked in our favor to the upside but to the downside we may have something. Think of the RS as the footing for the stock. If the RS is weak the overall trend will probably be weak and vice versa. That doesn't mean stocks with RS's in O's don't go up, but knowing the position of the RS determines how you play the stock. How close you set your stops etc. Some money managers will not buy a stock if it has a negative RS, period. Hope this helps. Let me know, Jan