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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Lucretius who wrote (17846)	5/3/1998 8:27:00 AM
From: donald sew	Respond to of 94695

Lucretius, Here's part of post on TSO which is right in line with what you are indicating. I left out the portion which specificly explains what I mean by range-trading-trend. >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>> I feel that we are now in a range-trading trend since many indexes have now started short-term downtrends such as the: XAL - AIRLINES TRAN - DOW TRANSPORTS PNX - PHONE UTIL - DOW UTILITIES UTY - UTILITIES RLX - RLX CEX - CHEMICALS DRG - DRUGS BKX - BANKS(needs a bit more confirmation) These are not a few and they are important indexes, and for those who are DOW THEORIST the DOW TRANSPORTS & UTILITIES are setting the stage for lower lows and lower highs. Additionally, we can look at the action amongst the indexes that they are starting to diverge, which can be interpreted as a change in trend. I think the KEY is the divergence in the TRANSPORTS(ESPECIALLY AIRLINES) AND UTILITIES from the SPX/DOW/COMP Also the SPX is now a CLASS 2 SELL and is slightly below setting a TRIPLE TOP, not just a DOUBLE TOP. The peak for the SPX is at 1132 and since my short-term technicals are indicating that it is a CLASS SELL, and it is still about 10 points below the peak of 1132, I do not think the SPX will break thru during this short-term cycle. I have also followed the NEW HIGH/NEW LOW for both the NYSE & NAZ and they are also starting to DIVERGE. For a quick example, when the market was strong in FEB/MAR the NEW HIGHS for the NYSE, on a daily basis, was commonly in the 200-300 range. This past week the DOW regained all of its weekly loss and is only 60 points off its highs, but it did it with barely an average of only 100+ NEW HIGHS. My studies on the NEW HI/LO's is much more extensive than just that, but it would just take to much time to go into full detail. I also assume that we could also notice similar divergences in the ADVANCE/DECLINE and the UP/DOWN VOLUME. If anyone can comment on these 2, it would be helpful. I am not saying that the BIG KAHUNA is coming or not coming, I am just saying that the trend change has been confirmed to RANGE-TRADING-TREND. Also this does not mean that some indexes cannot still set higher highs, but the limit is near, if not at the 9200 range for the DOW. OK, per my short-term technicals, yesterday's action in the market has signaled many CLASS SELLS: CLASS 1 SELLS: MSH - DOUBLE TOP CHART FORMATION IIX - DOUBLE TOP CHART FORMATION OSX - TECHNICAL BREAKOUT (careful due crude prices rising) CLASS 2 SELLS: SPX OEX NAZ NDX BKX PNX XOI (CAREFUL DUE CRUDE) XBC RLX CEX FPP Approximately 1 more up day and those CLASS 2 SELLS will become CLASS 1 SELLS. As for the immediate few days, I feel that that is Monday is not down it should at least be flat (PLUS OR MINUS 30 dow points). I see a greater possibility of next week being down than up, and that the previous peaks in the major indexes will be the upside limits (DOW @ 9200, SPX @ 1132), if it gets that high. For CANDLESTIC lovers, the SPX, OEX, DOW formed perfect "HANGING MAN" on the weekly charts, which is a strong reversal signal. It is also the first time a HANGING MAN appeared on the weekly charts since this rally started. Here are the week's highs for the last 4-5 weeks in sequence: OEX - 541, 542 543, 548, 542 (difference of only 7 points) DOW - 9094, 9168, 9213, 9148 (difference of only 119, but if you consider only the last 3 weeks the difference is only 65 points) <<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<< Seeya