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

To: Al Serrao who wrote (5247)	7/31/1998 10:10:00 AM
From: james ball	Read Replies (1) \| Respond to of 34814

From Tom Dorsey To All. When I look at this market it reminds me of 1994. The first half of 1994 saw the Bullish Percent decline while the broad averages held up well. Kind of a stealth bear market. It wasn't until October when the Broad averages, (I should probably qualify that now to narrow averages like the Dow S&P etc.) finally got their hit. The net of the year ended up with the Dow and S&P relatively unchanged on the year but 80% of all stocks underlying the NYSE took a 20% or better hit during the year. CNBC and the market pundits insist on popping the champagne bottles about the strength of the Dow and S&P when they were making new highs, all the while the soldiers ie. bullish percent was caving in. This index performed brilliantly through this whole smoke screen. YOu all are in the select minority who understand it. You don't need to read many papers or watch much financial TV when you have these souless barometers that do the reading for you. They help you think clearly about what is truly going on in the market and not the smoke the media would have you think is going on in the market. Forgive them lord for they know not what they do. When the short term indicators are positive but hte long term are not you must think short term and follow up allpositions with stops. Real stops that you enter on the books. When stopped out it forces you togo to cash and rethink that position. This keeps you from getting trapped when the short term turns south again and moves in concert with the long term. I was at dinner the other night with a large money manager/broker who said he got trapped in the last sell off of a couple of weeks ago. He understands this and should not have allowedhimself to get trapped. He did not enter stop orders and the market swept his positions south before he had a chance to think. When the long term is positive stops can be mental as the probability of a washout is not likely. Tom Dorsey