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

To: Judy who wrote (16851)	10/21/1998 8:10:00 PM
From: dennis michael patterson	Read Replies (3) \| Respond to of 42787

Judy: I cannot wait to hear what you think of this. Jerry Favors Analysis - Wednesday, October 21, 1998 8 p.m. At the highs today the Dow was up as much as 56.12 points and at the lows the Dow was down as much as 59. We closed up 13.13 . Compared to the last several days today was abit on the dull side. However we are now into the time frame when the cycles call for a short term high,that is October 22 plus or minus 1 or 2 days. The 5-Day RSI has now reached a high of 88.36,and that alone suggests some sort of at least short term high is near. Now the RSI has been moving higher and higher into extreme overbought territory all week,but we did not want to let that cause us to act to early on the short side until we reached into the October 22 time frame. So far the high for the week has been 8652.86 on a print basis. We do believe that level will still be exceeded even if the corrction were to start from here. It also remains our position that even after the correction begins,the Dow should eventually rally back above this week's closing high,whether that closing high is today,tomorrow or Friday. Any rally above 8562 on a print basis in the Dow tomorrow morning will give a short term positive signal from the hourly charts and that could lead to a test of or rally just above 8652.86,yesterday's print high. Any decline below 8446.12 on a print basis tomorrow morning would give a short term negative signal for Thursday morning. However if that were to occur and the Dow were to sell off strongly at some point tomorrow we would not be surprised by some last hour snapback which pulled the Dow right back up by the close. The wave structure still suggests the rally is probably not yet over and there should be another rally above 8653. No matter what the Dow does tomorrow the Gann 3-Day Chart could not turn down before Friday of this week at the earliest. If it does turn down Friday it will be a good signal the high due this week is in,so Friday should be the pivotal day this week. After the Cycle high due this week the next cycle low will be due near October 28,so unless we see strong arguments against higher prices we will take a long position in that time frame.If so it will most likely be in the strongest blue chips. Those which hold up the best during the correction will be the best candidates. We will give you a list of those candidates in a few days. Right now we want to concentrate on the right momemnt to go short for the decline into next week. We do not believe we are there just yet.