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

To: Al Serrao who wrote (9910)	11/20/1998 1:29:00 AM
From: Smooth Drive	Read Replies (2) \| Respond to of 34809

Hello Al, >>Duke60, do you still think this was a small cap rally or was this a tech rally of which many were small caps?<< I too will be interested in Dick's response. We both are keeping P&F indicators. One that I'm hand charting is what Cohen called the "Index of Speculative Confidence". You divide the Russell 2000 by the S&P 500. Cohen used a 1% P&F chart. If it's rising small stocks are outperforming large cap. (Recently there was talk of subtracting one from the other and dividing by the large cap. But - it's just a recip of Cohen's.) Here's a dab from late 95 to current. 55% 54% 3 53% U 0 52% O 0 51% I 0 50% S I 49% 2 48% 5 0 47% I P L 46% E J L 45% S J L 44% H J I 43% P 6 42% W 41% 5 40% G 39% S 38% J 37% 5 36% L 35% B 4 34% 6 4 33% 8 4 32% I On all my market timing P&F charts I use this bastardized numbering system so I know what date the action took place. This chart starts at 50% on 11/17/95. It hit a high of 54% on 5/3/96. Reversed down on 7/10/96 and bottomed at 43% on 4/29/97. Reversed back up on 8/27/97 and topped at 48% on 10/10/97. Reversed back down on 11/25/97 and bottomed at 32% on 10/15/98. Reversed back up on 11/4/98 to 35%, and is currently at 34.22%. Results per above, as follows: 11/17/95 7/10/96 7/10/96 8/27/97 S&P5 600.07 656.06 9.33% 656.06 913.7 39.27% R2 303.84 332.71 9.5% 332.71 420.84 26.49% 8/27/97 11/25/97 11/25/97 11/4/98 S&P5 913.7 950.82 4.06% 950.82 1118.67 17.65% R2 420.84 426.91 1.44% 426.91 392.96 <7.95%> 11/4/98 11/19/98 S&P5 1118.67 1152.61 3.03% R2 392.96 394.37 .36% The current upmove might be another head bob or the beginning of a smaller cap rally. I'm going to chart this one next with .05, 1 and 2% log charts going back 10 years. Take care, Eric

To: Al Serrao who wrote (9910)	11/20/1998 6:18:00 AM
From: Mr. BSL	Read Replies (1) \| Respond to of 34809

Al, small cap rally or was this a tech rally of which many were small caps? I guess you would have to come up with some sort of RS chart for tech stocks and compare it to Eric's RS work for small caps. From the funds I follow, it looks like it is more of a small cap rally. Since the bottom: S&P 500 up 20% Tech funds - ATECX up 39%, RYOCX up 35% SmCap funds - RSEGX up 44%, RSMGX up 43%, FUSMX up 42%, BESCX up 36%. RSMG is not overweighted in tech stocks. The other 3 are. Eric - I keep a chart using your same formula. I normalized for 50% at 7/91. Our charts are similar. Bottom line - The trend is your friend. Both sectors/areas are profitable now. Dick