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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Jack T. Pearson who wrote (6178)	2/12/1999 1:39:00 AM
From: Art C.	Read Replies (2) \| Respond to of 99985

Looks as if the market is waiting on "something"---don't know what to decide its direction. If you look at the daily chart of the DOW, it has formed a descending triangle with the lower base at 9100 and the upper leg descending steadily. As far as I can tell, it is going to have to break out--up or down by March. Art

To: Jack T. Pearson who wrote (6178)	2/12/1999 8:04:00 AM
From: donald sew	Read Replies (1) \| Respond to of 99985

INDEX UPDATE ================================== With yesterday's strong move in the market I am hearing from the average investors and brokers last night that we are DEFINITELY off to the races again. So the emotions are up again, based on one day's performance. Such view is from those outside of this thread, since it appears that most of those who were bearish here have not yet turned completely. I mention this since I am a strong believer in not making a decision on 1 days performance in this especially volitile market. I would like to stay with the basics and focus on whether we are producing a LOWER HIGH or HIGHER HIGH on the upside, and HIGHER LOW or LOWER HIGH on the downside. During the previous dip, the NAZ,NDX,DOT,SPX,OEX,BKX,UTY all produced LOWER LOWS. The INDERNET INDEX(DOT.X) has already completed 1 full cycle of a LOWER HIGH and LOWER LOW. The DOW did not produce a LOWER LOW, and came within approx 40-50 points of the previous trough. If the major indexes do not produce higher highs during this immediate short-term uptrend, such would imply that the current short-term trend is down. Here are the levels some indexes must achieve to produce HIGHER HIGHs: DOW - 9430 SPX - 1280 OEX - 643 NDX - 2151 NAZ - 2533 So if these indexes do not exceed such levels it would produce a LOWER HIGH which is negative technical sign. I am not saying it is conclusive, since anything can change, but just saying it would be a significant negative for the overall market. I felt it is important to mention this, since I strongly feel that making a market decision on one days performance is not the best way to analyze the market. I am still bearish towards the overall market in the mid/longer-term, and until the major indexes produces HIGHER HIGHs I will remain bearish. In light of many making decisions on one days performance, it is even more important that there is follow-thru over the next few days, especially today. Also the market internals needs to improve IMMEDIATELY and STRONGLY to support further upswing. Yes, I have my doubts. As previously mentioned the DOW is already approaching the overbought range per my short-term technicals, so if the DOW does continue straight up there is still about 2-3 days of potential upside before it reaches extreme overbought(CLASS SELL). This does not mean it cannot turn down right from here, just speaking of potential upside. As for chart patterns, the BULLISH(DECLINING) WEDGE was actually pierced to the upside slightly, but it needs confirmation. It could also be morphing into a flag pattern. The MAIN DECLINING PITCHFORK is still intact and the UPPER TINE is around 9400. I believe a significant break of the UPPER TINE would be the first significant sign that the DOW is heading higher. seeya