Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Stock Attack -- A Complete Analysis -- Ignore unavailable to you. Want to Upgrade?

To: dennis michael patterson who wrote (13961)	8/5/1998 1:09:00 PM
From: The Jedi	Read Replies (1) \| Respond to of 42787

Thanks Dennis. Did he specify before or after Oct option expiration? Kiri

To: dennis michael patterson who wrote (13961)	8/5/1998 1:10:00 PM
From: FJV	Read Replies (1) \| Respond to of 42787

Dennis, This A.M., Favors indicated that a buy signal would be triggered if we hit 8536.74, which we surpassed easily. Is he now saying that the buy signal was withdrawn? Confused. Thanks for the updates. Franco

To: dennis michael patterson who wrote (13961)	8/5/1998 4:39:00 PM
From: Les H	Respond to of 42787

Jerry Favors Analysis - Tuesday, August 4 8 pm Phone-614-868-1053 At the lows today the Dow was down as much as 299 points.We closed down 299.43. Today was an important day because of the implications of the Gann Quarterly Chart. The Gann Quarterly Chart is perhaps the most important of all the Gann Swing Charts we follow, and we follow over 20 of those Gann Charts.For the Quarterly Chart to turn down the Dow must fall below the intraday low of the prior quarter. The intraday low of the prior quarter was 8524 intraday and the Dow fell below that level today. So the key Gann Quarterly Chart is now pointing down. Now keep in mind that W.D. Gann's rule was that after a Bull Market had continued for several years a downturn in the Quarterly Chart is often a signal that the Bull Market has ended. Our research of the last 200 years confirms Gann's conclusions. However we must say that in the last few years every downturn in the Quarterly Chart occurred within just a few days of a major bottom. If we are still in a long term Bull Market today's downturn in the Quarterly Chart suggests we should be near some sort of important bottom. However if the Dow reached a major top on July 20,as we maintain it did,today's downturn in the Quarterly Chart just confirms that we have seen a major top. Now do not get our opinion wrong here.We have examined every Quarterly Chart signal for over 100 years.Even during major Bear Markets,a downturn in the Quarterly Chart normally occurred either the same day or within no more than a few days of some sort of short term low. The rallies have tended to last anywhere from a few days to a couple of weeks or more,even during Bear Markets.We believe today's downturn in the Quarterly Chart suggests we are near at least a short term low. The Dow gave a new downside projection calling for 8387 plus or minus 102 points intraday. The Dow closed below the bottom of the 21-Day 3 1/2% Exponential Trading Band,which is rare. That will normally only happen during major declines,and even then the Dow will normally reach some sort of short term low within a day or two after any close below the bottom of this band.If the Dow continues to decline from here the next major support will be near the bottom of the 10-Week 7% Exponential Band. The bottom of that band should be near 8326 or so.If we fall down near or below the bottom of that band intraday the odds of some sort of short term low will actually increase. The 5-Day RSI on the Dow closed at 14.43,which is extremely oversold. We have examined the RSI during every major decline this century,and when it falls down near 10 you are normally near at least a short term low. The Trin-5 closed today at 5.84,and we know the Trin -5 indicates you are near some sort of low when it rises up near or above 6.00. Today's reading was close to 6.00 but did not quite reach it. We have seen short term lows near readings as high as today's during the Bull Market. They are just not as reliable as when the Trin-5 rise above 6.00. Volume picked up significantly on today's decline,and that is a negative.Low volume during a decline is bullish,but high volume during a decline is bearish,unless you are near a selling climax. The question is whether this is a selling climax? We have our doubts,given the trading index readings. Cycles call for the next short term turning point near August 5 plus or minus 1 day,and we are in that time frame now. We think the odds favor a short term low in this time frame and then a rally which could last a week or more. The next Top-to-Top Count calls for a high between 8/7 and 8/18.Cycles suggests that if that count is correct the most likely target for the next important top is near August 13,plus or minus 2 days. Bottom line we should be near a short term low,although it may take another day or two. The 3-Day Chart could not turn up before Friday,so we may not get confirmation of a short term low before then. But we may decide to take short term traders long before then,perhaps on tomorrow's update. However our primary goal will still be to take all subscribers 100% short into a rally.That rally has eluded us so far,but there will be one soon,and it should be a strong one. It must be strong enough to convince most of the Bulls that we are back on our way to new highs again.That will be the time to go short.