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To: James Strauss who wrote (56500)	10/27/1998 3:50:00 PM
From: HairBall	Respond to of 58727

James: Well my technicals only indicate direction not price points or duration. Friday and Monday I got short-term sell signals for many Indices. So, I have been trying to use chart formations coupled with support and resistance areas for guidance. (And of course, Donald Sew's post.) Most of my work is done End of Day. I have tried to do some Intraday, but I have been having problems printing Quote.Com until NOW! I am still looking for the Dow Industrials Bull Flag to hold, for now! That is my first line of support. That lower trend line appears to be right around 8350 for today. (I had stated earlier I thought it was around 8325, but I was having to do the extension without a printout.) Next level of support is 8250! Time will tell...<g> BWDIK Regards, LG

To: James Strauss who wrote (56500)	10/27/1998 7:44:00 PM
From: donald sew	Read Replies (1) \| Respond to of 58727

Jim, I have been watching the NEW HIGH/NEW LOWs very carefully and is an important part of my analysis. I have found examples where the NEW LOWS were close to "0" for a whole month only to have the rebound end then produce lower lows. I have also found many cases where that rule of staying below 40 works. It also appears from my research that such rule works well in a BULL/uptrending market. On the other hand, I have noticed that such rule fails in a BEAR/downtrending market. In the following chart, you can see 4 failures of that rule, during the 73-74 bear market (DEC 72, OCT 73, FEB 74, NOV 74): decisionpoint.com If you check throughout the 1970's there are many examples of such rule failing. Once the bull market started in the 1980's, that rule basicly worked all the time. It becomes a question of what comes first: the chicken or the egg. Just not sure if that rule is a good leading indicator. If we are back in a bull market then that rule will work. I do believe that you will get the 4 days in a row, but I just have doubts that that rule is that conclusive. Back in the 1970's there was a whole month of less than 40 on the new lows, and we all know what happened in the 70's. As I indicated in an earlier note, maybe add another variable like the new lows staying below 40 with the new highs above______(whatever). Seeya