As noted in my daily chart above I am still expecting the formation of a new T as part of the recent recovery by the S&P 500. See my recent weekly updates. The outlook remains bullish as long as the blue volume oscillator continues to hold its rising bottoms pattern. This suggests a trend that is in the process of turning up from the recent decline. A rising oscillator bottoms pattern, while the S&P is making new lows, is usually interpreted as Accumulation. Click on image for a larger view.
The potential new T sketched in, but not confirmed so far, is expected as a consequence of other T Theory considerations such as longer range Transport and A-D Ts that I will introduce here in later Updates. To confirm the new T as sketched, the blue volume oscillator must break above the green cash build up line. So far there is resistance to further upside, no doubt due to higher oil prices, election uncertainty, etc. We will see if another week or two can force the upside breakout. A successful breakout will result in a sharp buying stampede. Terry Laundry
Tom,
Can you describe why there can be accumulation and a cash build up period at the same time? Thanks.
Posted by: Daniel Wiggins | October 11, 2004 at 02:35 AM
Terry- if you were given either Growth or a general Equity index fund where would you place monies now -Thanks
Posted by: Jon Shallit | October 22, 2004 at 07:42 AM