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

To: Monty Lenard who wrote (32460)	10/26/1998 8:49:00 PM
From: HairBall	Read Replies (2) \| Respond to of 94695

Monty: does the divergence not bother anyone or did I just miss the post that discussed the issue? I assume you are talking about the divergence between the Dow Indices and the other major Indices, right? Dow Industrials, Transports and Utilities closing up, while the NYSE and SPX close flat and the NASDQ and RUT close up, right? Well my technicals were indicating a divergence as of Friday's closing numbers. Looking at the End of Day Theoretical Semi-Log Charts I glean the following: As of today's closing numbers, my technicals have now rendered or are currently in short-term sell signals on the Dow Industrials, Transports, NYSE, SPX, but still anticipating short-term sell signals for the NASDQ and RUT. Dow Industrials have formed a Bull Flag with a fairly narrow descending trading range. The Dow Composite, Transports, NYSE and SPX have formed Bull Pennants. (Extending the descending trend lines for the Dow Industrials Bull Flag for Tuesday is approximately: Upper = 8550 and Lower = 8225. Note: These numbers will be different when looking at the Actual intraday interval charts.) The Dow Industrials should continue a descending trading range (which could be considered a pullback) until the Bull Flag is resolved, which portends an upside breakout. As narrow as this range is, I suspect the formation will resolve by Wed/Thur. Once this occurs, the Dow Industrials, NYSE and SPX should resume the rally. The NASDQ and RUT are in a rising pattern. I expect a slight pullback or pause in these Indices as the Dow Industrials resolves the Bull Flag formation and then all Indices should join a continuation of the current rally. NOTE: I must say, I am feeling somewhat conflicted. My technicals are signaling pullbacks for most of the Indices and forward looking I expect signals forth coming for the NASDQ and RUT. However, it is possible for both my technicals and the chart formations to coexist, if the pullbacks are slight to flat using the chart formation constraints as guides. If these formations are negated (not just violated) to the downside, it could portend a strong pullback. But, I feel this possibility is less likely! BWDIK Regards, LG