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The DJI update.
On the chart DJI20Sep.gif, you will find some labels.
I & IV show the 4 conditions to watch for the downtrend.
II show the breakout & increase in up/down volume.
Which is at the bottom of the chart. Note the green 10 day MA
moving above the red 50 day MA.
III the conditions for an upward move.
Now we can compare V & VI to the corresponding II & III.
II vs V
Is V a channel breakout like II or more of a sideways move?
small red flag.
III vs VI
Presently the huge surge in up/down volume ratio isn't present.
Note in III how the green 10 day MA surges above the red 50 day MA.
Big RED FLAG
Hence there is nothing to compare here. Another words the conditions
to go back into the market with confidence is not hear yet.
A dilema- my mutual funds have all moved up a bit.
A fair warning. I attached another gif taken from the www.vrsurvey.com
website. This is the guy I had mentioned who had forcast the DJI based
upon volume. I saw him in Feb on Nightly Business report. He was there
again on Friday. They superimposed the DJI over the anualfc.gif I am
sending.
His chart is dated so you can make comparisons. It was slightly off in
the April correction but he said he uses a broad paint brush. Also at
the bottom of his chart it says,"... that Y-values are subjective but
ideally track that of the Dow's. The AMF is intended as a guideline for
key change points and overall market direction."
It shows that the DJI is still headed lower with an end of year rally.
Like they say a picture is worth a thousand words.
I will stay put with my mutual fund money (in the money market account)
until all conditions are met.
Although I am tempted to move them in. As a side note when I looked back
at other timed on the DJI chart. The check points I follow do save you
from major market down turns. This reminds me that i will not move them
back in.
Harley Meyer
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